THE SunRice Group's revenue has dropped by seven per cent in the first half of the current financial year, but the company has still generated $507 million for the business.
Net profit after tax was $12.1 million.
SunRice said it had demonstrated "resilience and dynamism" to deliver these half-year financial results in the face of multiple headwinds, including:
- Escalating impacts of low Australian rice production, with the second consecutive year of record-low crops.
- Instability in key global markets, including negative impacts from foreign exchange movements, difficult economic conditions in key Pacific markets, and impact of a negative step change in commodity prices due to international trade conditions.
- Ongoing effects of the global COVID-19 pandemic, including significant impacts on economies of key markets.
"Despite multiple challenges, including the second consecutive year of record low Australian production, global headwinds and other impacts of COVID-19, we have delivered a strong set of financial results," SunRice Group's chief executive officer Rob Gordon said.
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"Our strong balance sheet has allowed the group to not only manage these challenges with great success, but also continue implementing our 2022 Growth Strategy - which as we start recovering from the bottom of the Australian agricultural cycle positions the company favourably for the future.
"While (the second half of the financial year) remains challenging, we are expecting results to improve in 2021-22, in part as the larger 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."
The company said the most recent financial results were driven by a number of factors, including:
- Improved performance in the International Rice segment, despite challenging global conditions.
- This improved performance in the International Rice Segment reinforces the resilience of the 2022 Growth Strategy as the company increased supply capability and sources to meet global demand.
- Loss of $3.1 million in the rice pool business, driven by the escalating low Australian production, with consecutive record low crops. This also affected the Rice Food and CopRice segments, with lack of inputs.
- Strong consumer demand for the group's products in the retail sector and contracted demand in food service channels in a number of markets revenue of $64 million for Riviana Foods.
- Revenue of $53 million for CopRice, down 21 per cent for the same time period last year, and a loss of $5 million, due to a number of factors, including a negative step-change in commodity prices due to international trade conditions, and the shortage of Australian rice by-products.