Australian Meat Industry On The Decline

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Australian Agricultural Company AACo, is one of Australia’s oldest public owned company. AACo formed in 1824 after the enactment of an Act of the British Parliament which gave the company the mandate to acquire an area equivalent to 1 million acres in the New South Wales for agricultural production activities. Over the years its has improved the production of beef in Australia through its innovative use of land and natural resources. Its head offices are currently in Brisbane, and since 2001 it has been listed on the Australian Stock Exchange. It operates over 24 cattle stations with two feeding lots holding over 565,000 beef cattle.
The Australian Agricultural Company (AACo) has reported that its income from meat and live steers deals has fallen $46 million for the six months to September 30, 2016. Recently this has led to a massive drop for the companies bottom line. Despite the company experiencing high draw-downs in net profit, its underlying earnings significantly improved by 2.4 million dollars. According to Jason Strong, the companies’ executive, a transformation from cattle production to processing and marketing of beef reflected the sales decline.
The companies’ beef sales contribute to approximately 80 percent of their revenue, which is a huge increment compared to the 47 percent a year ago. The setting up of an abattoir worth 90 million dollars near Darwin led to a decrease of the amount of cattle the company sold to the Live Export Trade. Mr. Strong is confident that despite the recent challenges his company have faced,they will realize positive results this financial year.
Also, the company’s directors firm commitments to reforming the business may help to achieve a more stable share price to its shareholders in the stock exchange market. They plan to grow AACo’s genetic investments and to develop a new brand that aligns with its centuries-old heritage, and will attempt to lower their debts while generating more profits.
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