The escalating impacts of low Australian rice production – following a second consecutive year of record-low crops – also played a role as revenue slipped 6.6 per cent to $506.97 million for the six months to October 31.
Profit attributable to the company’s B Class shareholders fell 3.8 per cent to $14.3 million.
The firm’s ASX-listed B Class shares were 1.4 per cent lower at $6.31 by 2.30pm on Thursday.
On the plus side, Sunrice said it expects an estimated 2021 crop of more than 450,000 paddy tonnes harvested in April 2021, more than 10 times larger than the 2020 crop of approximately 45,000 paddy tonnes.
The estimated paddy price range of $390 to $450 per tonne for Medium Grain Reiziq announced in September 2020 remains in place at this stage, however the benefits will largely not be felt until FY2022.
“In this context, (the second half) will be focused on preserving returns to shareholders and balance sheet strength to position the group favourably for the future,” Sunrice said in a release.
In addition to the record fixed price contracts paid to Riverina growers for the 2020 crop, should there be no significant deterioration in market conditions in the second half, the SunRice board currently intends to distribute a fully franked dividend at similar levels to the prior year – which was 33 cents per share.
“While (the second half) remains challenging, we are expecting FY2022 results to improve, in part as the larger (2021) Riverina crop is harvested and the Australian Rice Pool business recovers, and we realise the benefits of the investment in strategic and organic growth initiatives,” chief executive Rob Gordon said.
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