STOCKFEED and fertiliser distribution business Ridley has reported a statutory net profit after tax $52.7 million for the half-year ended December 31 in results out today.

The figure represents a 137.4 percent increase from the 1H25 result of $22.2M.

In releasing the results, the agribusiness said it had made significant progress in integrating the former Incitec Pivot Fertilisers distribution business, acquired in September last year, and had implemented a new operating structure.

Ridley’s revenue during the half grew 55.8pc to $1.03 billion, while its earnings before interest, tax, depreciation and amortisation jumped 9.5pc to $55.4M.

Ridley managing director and chief executive officer Quinton Hildebrand said earnings gains were driven by improved volumes and margins in the bulk stockfeeds segment.

However, the ingredient-recovery businesses were negatively impacted by lower commodity prices, and lower lamb slaughter rates affected OMP.

Mr Hildebrand said bulk stockfeeds contributed $27.1M to EBITDA, up 24.8pc, and packaged feeds and ingredients reported earnings of $25.8M, down 28.5pc on HY25.

“This result was achieved by 13pc volume growth in ruminant sales and 7pc volume growth in monogastric sales, together with higher margin supplementary feeding of beef and sheep at the start of the period,” Mr Hildebrand said.

He said the packaged feeds and ingredients business had several “short-term challenges” including ovine supply constraints due to reduced lamb slaughter rates, and lower prices for protein meals compared to prior years.

He said there were also several “processing challenges” at the Maroota and Timaru facilities.

“Due to a slip in the main cooling dam wall during a rain event at the Maroota rendering facility, this made the dam inoperable and imposed processing constraints, requiring us to incur costs diverting material to Laverton and other processors.

“The second temporary processing challenge has been with the commissioning delays at the new OMP Timaru greenfield facility, which has impacted our daily throughput and yields.

“On the positive front, the raw supply volumes to the rendering plants grew 7pc, and the packaged dog sales also grew 7pc, taking up the extrusion capacity vacated from the aquafeed transition.”

Fertiliser business update

The fertiliser distribution business contributed $10.3M to EBITDA after four months of ownership.

Mr Hildebrand said the result was at the higher end of expectations, with Ridley focused on margin management and cost control within the segment.

“I’m very pleased with the progress we’re making with the transition and integration of Incitec Pivot Fertilisers.

“Having owned the business for four months and being confident that our pre-acquisition thesis of a regional distribution model is correct, in the last few weeks we’ve flattened the structure and reduced the matrix model with the appointment of regional general managers in five regions.

“They’ll each have responsibility for both the sales and the execution of those sales through the primary distribution centres, making us more responsive to the customer and driving accountability for cost control.

“The outcome of this initial restructure is the removal of 45 roles, reducing costs by $8M per annum from FY27, with a one-off cost of around $3M in FY26.”

Mr Hildebrand said the company was yet to make a decision on the future supply contract with Dyno Nobel.

New concentrates line Gunbower feedmill

He said it was expected “in this financial year as Dyno Nobel run a process to find a buyer for [Phosphate Hill].”

He said the urea offtake agreement with Macquarie Commodities was also on track to commence in financial year 2028 “upon the commissioning of the Perdaman facility” north of Karratha in Western Australia.

Outlook, projects

Mr Hildebrand said Ridley expected earnings in the next six months to be supported by a further nine-month contribution from its fertilisers business, higher bulk-stockfeed volumes and market share, processing improvements in packaged feeds and ingredients, and a modest recovery in commodity prices.

He said several capital works projects were under way or committed, positioning the business for future growth.

In bulk stockfeeds, Ridley has committed to a $5.7M de-bottlenecking project at the Lara feedmill to be completed this year.

Mr Hildebrand said this was required due to “significant new layer and dairy business”, and the plant now operating seven days a week.

In November, Ridley completed a $1.6M concentrated production line at the Gunbower feedmill to add a new product offering.

Mr Hildebrand said the investments Ridley were making in the packaged and ingredients segment would “improve our processing performance”.

“The first two, the commissioning at Timaru and the replacement of the cooling dam at Maroota, are to address the short-term impacts we have endured in recent months.

“The third, additional small pack line at the Narangba extrusion plant, is to replace labour and meet new customer expectations.

“All these investments provide the runway to significantly improve the operating cost base and deliver incremental volumes.”

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