Elders (ASX:ELD) posts 31pc jump in half-year profit

• Citing several factors, Elders (ELD) has reported promising results across the board for the six months ending March 31 2021
• The Adelaide-based agribusiness generate $1.1 billion in revenue, representing a 22 per cent increase compared to the first half of 2020
• Likewise, statutory net profit after tax jumped 31 per cent to $68.2 million, while underlying earnings before interest and tax (EBIT) hit $73.8 million
• With such promising results, Elders also announced a partially franked interim dividend of 20 cents per share
• Costs are expected to increase in the second half of the year in line with Elders’ footprint growth and continued investments
• Elders ended the day down 3.43 per cent to trade at $11.81 per share

Citing several factors, Elders (ELD) has reported promising results across the board for the six months ending March 31 2021.

The Adelaide-based agribusiness generate $1.1 billion in revenue, representing a 22 per cent increase — or $200.3 million — compared to the first half of 2020.

Likewise, statutory net profit after tax jumped 31 per cent to $68.2 million, while underlying earnings before interest and tax (EBIT) hit $73.8 million, representing a 40 per cent increase over last year.

Elders said the results reflect growth across all state geographies and product lines — of which its retail segment was particularly strong, thanks to improved sales and margins as a result of its “backward integration strategy.”

The company said its Agency, Real Estate and Financial Services businesses also delivered promising results, largely off the back of strong livestock and property prices and positive farmer sentiment.

With such promising results, Elders also announced a partially franked interim dividend of 20 cents per share — a substantial increase from nine cents distributed in the previous half-year.

Managing Director and CEO Mark Allison said the half-year performance was the result of several key strategic initiatives.

“Elders’ recent acquisitions, backward integration strategy and customer focus combined with the resilience of our supply chains positioned us well to capitalise on favourable growing conditions and livestock prices,” he said.

During the first half of 2021, Elders continued to grow its branch footprint, establishing six new greenfield sites and purchasing another six, which are expected to generate between $2.5 million and $3.5 million in earnings each year.

Costs are expected to increase in the second half of the year in line with Elders’ footprint growth and continued investments in its growth strategies.

Elders is down 3.43 per cent to $11.81 per share at market close.