Affco gloomy on second half

Meat processor Affco Holdings says processing margins fell in its second half.

Affco chairman Sam Lewis said factors affecting profitability included reduced livestock numbers, the volatility and level of prevailing exchange rates and a tightening of market conditions offshore.

"All have combined to reduce processing margins in the second half," Lewis said.

In its half-year report, Affco had expressed a cautious outlook for the second half, given forecast kill numbers and market conditions generally.

"As the fourth quarter draws to a close this caution has proven well justified," Lewis said.

Affco posted a $15.3 million net profit for the six months to March 31, up 52.8 per cent on the same period a year earlier, boosted by rising international prices for lamb.

First-half revenue lifted 18 per cent to $588.3 million. Affco shares lost 3c to 39c.