Strong SunRice results
SunRice has improved its consolidated revenue by six per cent and net profit after tax by 32 per cent in the past 12 months.
The leading food company ended its financial year on April 30 this year with a consolidated revenue of $1.2 billion and a net profit after tax of $45.1 million.
The company has said financial results were driven by a combination of several factors, which included the largest Riverina rice crop in three years.
The increases are also credited to the ongoing success of selling premium Riverina rice into high returning markets and sourcing rice offshore to satisfy demand in lower returning markets, a rebound in medium grain rice prices following a 10-year low and a recovery in profitability experienced by Trukai, CopRice and Riviana.
It all led to a $79 per tonne increase in the base crop 2017 paddy price range, from $300 per tonne when the Rice Pool opened to close to $379 per tonne at the close.
‘‘SunRice has performed strongly through the commodity cycle with an immediate return to profit growth,’’ SunRice CEO Rob Gordon said.
‘‘Having demonstrated in financial year 2017 that the business has the strength, resilience and flexibility to weather cyclical commodity downturns, financial year 2018 was characterised by rebounding profitability and reinvigorated growth across the group.
‘‘SunRice’s international sourcing capabilities continued to allow the business to meet expanding demand for our products. Having maintained access to key premium markets in financial year 2017 despite the lower Australian crop, international sourcing enabled the swift return of Riverina rice into these markets.
‘‘Growth trends also returned to our profit businesses. CopRice recovered thanks to renewed stockfeed demand; Trukai reestablished profitability through recovering market share; and Riviana saw an uplift in net profit before tax due to the Fehlbergs acquisition and cost controls.’’
Mr Gordon said SunRice is uniquely positioned for continued growth, which he said would be driven by a refreshed five-year strategy ‘‘which builds on our resilience and operational strengths and focuses on how we can capitalise on global consumer food trends’’.
‘‘This strategy has already delivered results,’’ he said.
‘‘We established strategic partnerships with Japanese food wholesalers to deliver value-added opportunities in the market and we introduced our unique Low GI rice to new markets to help address diabetes and obesity.
‘‘We are also well advanced in securing a vertically-integrated supply chain in Vietnam.
‘‘This is an exciting time for SunRice and the Australian rice industry, which is the cornerstone of our ongoing success.
‘‘We look forward to progressing our five-year strategy as we seek to build an enduring global company to benefit generations to come.’’
To help secure its future growth, SunRice has proposed moving company shares from the National Stock Exchange to the Australian Securities Exchange, which would allow it to sell B Class shares more broadly to raise capital.
The listing will retain SunRice’s dual class shares model, with A Class shares to remain grower owned and to retain their controlling properties.
Initial information sessions on the proposal have already been held, with a detailed information booklet to be sent to shareholders and more meetings to be held before a vote at the SunRice AGM in September.