WCB lifts profit guidance
Higher prices for dairy products and the lower Australian dollar have enabled Warrnambool Cheese and Butter (WCB) to upgrade its profit guidance.
The company still expects its annual profit for the 2012-13 financial year to be lower than in the previous year, but the result is likely to be an improvement on the guidance that the company provided in April.
WCB said on Tuesday that it now expects its 2013 net profit will be about 52 per cent below that of last year.
In April, WCB had expected its 2013 net profit was likely to fall by at least 80 per cent as a result of subdued international commodity prices, the high Australian dollar and ongoing competition for milk.
"The recent improvement in trading conditions and overall business performance have provided a welcome lift in 2013 full year profits, and we expect the continuation of these factors will contribute to improved earnings in 2014," WCB chief executive David Lord said in a statement.
International dairy prices rose to record highs in the fourth quarter of the 2012-13 financial year.
Prices had since softened, but were still much stronger than the 2013 average.
The Australian dollar had also depreciated against other currencies.
WCB had also benefited from improvements to its business and a switch to making products that were more profitable.
Shares in WCB were 2¢ higher at $4.49 at earlier on Tuesday.
InvestSMART FORUM: Come and meet the team
We're loading up the van and going on tour from April to June, with events on the NSW central & north coast, the QLD mid-north coast and in Perth, Adelaide, Melbourne, Sydney and Canberra. Come and meet the team and take home simple strategies that you can use to build an investment portfolio to weather any storm. Book your spot here.
Want access to our latest research and new buy ideas?
Start a free 15 day trial and gain access to our research, recommendations and market-beating model portfolios.Sign up for free