Live­stock ex­porter rocked by res­ig­na­tions

Pilbara News - - News - Brad Thomp­son

Live ex­porter Wel­lard has been forced to re­lease unau­dited fi­nal re­sults in time for to­day’s re­port­ing dead­line which re­veal a cloud over the com­pany’s abil­ity to con­tinue as a go­ing con­cern.

It has also been rocked by the res­ig­na­tion of non-ex­ec­u­tive di­rec­tor Sharon War­bur­ton and gen­eral coun­sel and com­pany sec­re­tary Yas­min Broughton.

Wel­lard had breached an un­der­tak­ing in its work­ing cap­i­tal ca­pac­ity at June 30 but ob­tained a waiver and ex­ten­sion.

The Fre­man­tle-based com­pany has un­til Oc­to­ber 14 to rem­edy the sit­u­a­tion or it be­comes a de­fault.

Bor­row­ings of $158.9 mil­lion have been re-clas­si­fied from non­cur­rent to cur­rent li­a­bil­i­ties, re­sult­ing in a work­ing cap­i­tal de­fi­ciency of $110.3 mil­lion.

Wel­lard is also likely to breach fi­nan­cial covenants to be mea­sured at Septem­ber 30 and De­cem­ber 31 in work­ing cap­i­tal and se­cured loan fa­cil­i­ties.

The re­main­ing di­rec­tors be­lieve it is ap­pro­pri­ate to re­fer to the com­pany as a “go­ing con­cern” be­cause there is an ex­pec­ta­tion the breach can be reme­died and debt providers will waive an­tic­i­pated breaches.

There is also an ex­pec­ta­tion Wel­lard will re­ceive $15.8 mil­lion it is owed by man­ag­ing di­rec­tor Mauro Balzarini’s pri­vate com­pany.

“Should Wel­lard or the group be un­able to achieve the mat­ters set out above, a ma­te­rial un­cer­tainty would ex­ist that may cast sig­nif­i­cant doubt as to whether Wel­lard will be able to con­tinue as a go­ing con­cern,” the pre­lim­i­nary fi­nal re­port states.

Wel­lard’s net profit af­ter tax came in at $14.8 mil­lion, which was in the range ex­pected af­ter three down­grades.

How­ever, it was less than a third of the $46.4 mil­lion tipped in the com­pany’s prospec­tus last year.

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