Allied Farmers forecasts flat profit

Hawera-based rural services company Allied Farmers Ltd today warned of a flat full year profit as lower export earnings hit its livestock division.

Chairman John Loughlin said Allied's pre-tax result for the year to June 30, 2006, was likely to be in line with last year's result.

A fall in export schedules for lamb and beef would impact on returns for its livestock operations, Mr Loughlin said.

Earnings in the company's rural division were also expected to be lower, as excellent spring growing conditions in Taranaki and King Country meant demand for farm inputs had dropped off.

Offsetting these reductions would be a significant improvement in the company's finance subsidiary and a much-reduced loss in the Allied pine subsidiary.

"As a consequence of the changed composition of earnings the result for the first half of the year would be lower and the second half correspondingly higher than 2005," Mr Loughlin said.

The company did not expect a repeat of the one off tax benefit that occurred in the 2005 financial year.

Shares in Allied Farmers last traded unchanged at $2.30.

- NZPA