Agribusiness

Ingham’s FY23 profit of $60.4M up 72pc

Grain Central, August 28, 2023

Ingham’s revenue has eclipsed $3 billion in FY23. Photo: Ingham’s

AUSTRALIA’S major poultry producer, Ingham’s Group, has posted a net profit after tax in the year to June 24 of $60.4 million, up 72.1 percent from the FY22 result.

In results announced on August 17, the company announced a core poultry volume of 463,500 tonnes in FY23, down 0.4pc from FY22, but a 35.8pc increase from FY22 in underlying earnings before interest, depreciation, taxation and amortisation to $183.6M.

On the operations front, FY23 has seen Ingham’s close its feedmill at Wanneroo in Perth’s northern suburbs, and progress its plans to develop a “breeder triangle” at Casino in northern New South Wales.

Company commentary on the results states broad cost pressures continue to be experienced.

“While the pricing of feed ingredients stabilised during the year, the pricing of wheat and soymeal is expected to remain elevated versus longer-term levels due to tight global supply and geopolitical uncertainties,” the company said.

“Inghams remains focused on ensuring pricing levels appropriately reflect ongoing business cost pressures and will pass on further price increases as required.”

Revenue passes $3B

Inghams revenue increased 12.2pc from FY22 to $3.044 billion, due largely to higher net selling prices in response to the increased underlying total costs, which were up 11.9pc.

Inghams chief executive officer and managing director Andrew Reeves said the improved results point to operational recovery across the business, with farming performance continuing to recover and supply chain conditions normalising.

Chicken remains the lowest-priced and most-consumed meat in Australia.

They also reflect the inflationary environment.

“During the course of FY23 we productively engaged with our customers to implement price increases across all channels,” Mr Reeves said.

“The price increases were necessitated by the significant increase in feed costs, and growth in other key input costs, with market demand for poultry that continues to outpace supply.

“In addition, we have continued to leverage growth channels that provide greater value, rationalising our product range and maintaining our long-term focus on operational efficiency.”

Cost inflation is being seen across a broad range of key inputs with feed, fuel, freight, ingredients, cooking oil, and repairs and maintenance exceeding general inflation.

Volume moves mixed

In Australia, poultry volume slipped 0.6pc from FY22, driven mainly by lower bird numbers processed as a result of reduced fertility levels from roosters in 1H.

In New Zealand, volumes grew 0.8pc in FY23, with the recovery in volumes during the second half offsetting the lower 1H performance, in part because a lower egg-setting implemented to address the impact of labour-related processing constraints.

External feed volumes indicate tonnage sold by Inghams to customers outside its own supply chain, and they declined 43,600t in FY23 to 292,700t due to the planned closure in April of the Wanneroo Feedmill in Western Australia.

Casino rising

Within the FY23 results was an update on progress at Inghams’ breeder triangle being established at Casino to service poultry operations in Queensland.

In its HY23 results, Inghams put the cost of one rearing farm and two egg-producing farms at $30M.

The total project cost is now seen at $50-$55M, and Inghams reports the first of two egg-producing farm commenced operations in April 2023 as scheduled, and the rearing farm is already operational.

The second production farm is scheduled to commence operations in November.

As stated previously, the Casino breeder triangle is expected to produce approximately 700,000 eggs per week when fully operational.

Ingham’s other investments covered in the FY23 results include a new waste-water treatment plant at its processing facility at Osborne Park in WA, and the progressive rollout of three distribution facilities as the company further readies itself for long-term growth.

Source: Ingham’s

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