TasFoods has received two proposals for its Nichols poultry business as the Australian group continues to reassess the business unit.
In a statement yesterday (18 December), the Launceston, Tasmania-based company said the proposals are “indicative non-binding” in nature.
The parties behind the approaches were not named.
TasFoods said it is “pro-actively” engaging with the parties and is considering “all options, including divestment” while stressing the approaches are “not at an advanced stage”.
At the time of announcing its first-half results in August, TasFoods said it was reviewing poultry operations.
The company also recorded a non-cash impairment in the poultry division of A$1.2m (today $792,732) following a review of the value of the “cash generating units and assets” across the company.
TasFoods reported a first-half net loss after tax of A$3.6m, a 29% improvement on the net loss after tax of A$5m a year ago.
Sales revenue for continued operations – poultry and cheese – fell 21% year-on-year to A$19.9m, driven by the “continuation of poultry oversupply and heavily discounted wholesale pricing across market channels”.
Gross margin for the poultry division slipped to 22% from 23% in the year-ago half.
The indicative offers come during a period of portfolio reshaping by the ASX-listed group.
In September, TasFoods agreed to sell its Pyengana Dairy operation to Research Corporation Pty Ltd. and Associates for A$2m (then $1.3m).
Acquired in 2017 to diversify TasFoods’ portfolio, Pyengana Dairy struggled to meet performance targets.
At the time of the Pyengana sale announcement, TasFoods indicated part of the proceeds would be used to “strengthen” its poultry supply chain.
The planned disposal followed a push into poultry with the A$1.3m acquisition of Redbank Poultry in December 2023.
TasFoods had sold its Shima Wasabi spices business to Hillwood Berries in 2023 as part of a brand streamlining exercise.
In October 2023, TasFoods also announced its entry to the pet-food category with the Australia launch of the Isle & Sky brand catering to cats and dogs.
