Valad reports a $248m loss

The latest result, which market analysts described as disappointing and generally negative, compared with a net profit of $109.1 million in fiscal 2006-07. Distributions for the period were steady at 11.10c a security, in line with revised 2007-08 guidance issued in June.

Excluding one-off charges, the group posted a 222 per cent rise in net earnings to $169.6 million, which was in line with the directors' forecasts made in mid-June. The one-offs included a $247 million write-down in goodwill relating to the European operation.

Despite the red ink in the accounts, investors were optimistic and pushed the units up 4c, or 9.3 per cent, to 47c.

Valand's former head of British operations, Peter Hurley, is replacing executive chairman Stephen Day, who has moved to an executive director role due to ill health.

Mr Hurley said the distribution policy had changed, with a payout of 75 per cent of underlying earnings. He expected a net profit for 2008-09 in the range of $115 million to $145 million, which translates to earnings per security of 7c to 9c and distributions of 5.25c to 6.75c.

Analysts at Macquarie Equities said Valad's guidance for 2008-09 underlying earnings was down 14 per cent to 32 per cent on the previous corresponding period and included $5 million of one-off and restructuring costs.

"We are currently forecasting $148 million and thus envisage downgrading our forecasts. This comes only eight weeks after Valad provided a business update and their expectation that they would grow 2008-09 earnings."

Mr Hurley said the guidance for the 12 months ending next June represented "our conservative view of reliable earnings that we expect to achieve this year. This is obviously formed on the basis that market conditions remain under stress but do not suffer a material deterioration."