Richmond set to hit back with $10m profit

HASTINGS - Hawkes Bay meat company Richmond is set to announce a dramatic turnaround with a half-year profit tipped to exceed $10 million.

The result is expected to reflect the benefits of the merger with the Waitotara Meat Company and savings made by centralising its specialist lamb cutting to FoodTech at Takapau.

It is also likely to help bury criticism about Richmond's poor performance. The criticism has been seen as assisting South Island processor PPCS in its takeover bid for Richmond.

Richmond executives have said that when the company returned to profit they would consider some form of sharemarket float for the company.

Last year, the company posted a first-half year loss of $2.3 million and finished the year with an $850,000 loss. It made an operating surplus of $3.9 million but that was eaten up by $6.6 million in restructuring and non-recurring costs.

It is not clear if Richmond's half-year result will be announced before a crucial meeting with the Waitotara Farmers Holding company next Monday.

At the Waitotara meeting, 100 farmer shareholders will vote on a recommendation by three of its four directors to sell their 9.3 per cent stake in Richmond to PPCS for $6.3 million, or $1.65 a share.

The Waitotara sale would give PPCS 40 per cent of Richmond - just 5 per cent under its target.

- NZPA