Trans-Tasman food group Goodman Fielder has sunk into the red with a full year loss of $A405.1 million ($NZ445.2m) and says trading remains difficult.
The company, whose brands include Meadow Fresh, Vogel's bread, Edmonds and Ernest Adams, says it faces stiff competition from rivals in terms of volumes and pricing.
The biggest slump in earnings came from its New Zealand dairy division, which posted a 47 percent drop $A19.9m, even as sales jumped 20 percent to $A472.7m.
It says it is trying to arrest its earnings decline in its grocery business, particularly in spreads and edible oils, while trying to improve bakery manufacturing and to cut costs.
"While the company expects FY15 to be another difficult year, it continues to refine its strategy and re-align the cost base to deal with these challenges to build its competitive position," Goodman said in a statement.
Goodman's loss for 2013/14 compared to a $A102.5m profit for the previous year.
Revenues were fairly flat at $A2.2 billion.
The results follow a $A1.37b takeover offer from an Asian consortium in May.
Goodman Fielder cut its full year dividend by one cent to two cents a share following its massive loss.
The result was dragged down by a larger-than-expected $A468.2m in costs associated with the ongoing restructure of its business, non-cash impairment charges, and losses on the sale of its biscuits, meat and pizza divisions.
Stripping out those charges, Goodman's underlying net profit for its continuing operations fell to $A63.1m in 2013/14, from $A75.7m.
Chief executive Chris Delaney said a record rise in farmgate milk prices in New Zealand, higher wheat prices in Australia, and increased transport costs for its bakery business had hurt the group's earnings.
"This is a disappointing result in the context of where the company had expected to be at this point in the strategic plan," he said.
He said he had expected the company would return to profit in fiscal 2014.
It would now focus on ramping up cost cuts across the business and introduce a more simplified corporate structure to help save $A25m by fiscal 2015.
source: newshub archive