Elders slumps to $568m loss on restructure costs

The company also made an underlying loss in 2012/13, excluding one-off items, which Jackman said was extremely disappointing. Photo / Thinkstock

Australian-based agribusiness Elders has fallen to an annual loss of A$505 million ($568 million), but says big costs from its restructuring are behind it.

The loss, which Elders had previously flagged, was a result of charges related to moves to narrow the company's focus down to agriculture.

Managing director Malcolm Jackman said the company had made the last of the major writedowns related to its transformation to a company focused on rural services.

The company has sold its automotive interiors and insurance businesses, and has nearly finished selling its forestry assets. As a result, Elders has substantially reduced its debt.

But the company also made an underlying loss in 2012/13, excluding one-off items, which Jackman said was extremely disappointing. The loss reflected seasonal conditions and accounting discrepancies, an issue announced to investors in early October.

"A hot spring and an extremely dry summer really impacted livestock prices over the past 12 months," Jackman said. "And then of course, out of the blue, we get smacked with this accounting irregularity."

Elders' rural services business took a A$24.2 million hit to earnings from the discrepancies in the live export business.

Investigations are continuing into the accounting irregularities, but Elders said current evidence pointed to likely inappropriate, and potentially fraudulent, activity.

Jackman said the rural services business had experienced a strong start in October and November, and was tracking well as more rain fell on the east coast of Australia and across the top end.

He said the company was still in talks with parties interested in recapitalising the company, but no binding or complete proposals had been received.

- AAP