Diverse agribusiness TasFoods Limited has taken big strides on what it calls its “pathway to profit”.
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The company improved its earnings before interest, tax, depreciation and amortisation (EBITDA) outcome by $1 million in the half-year to June 30, compared to the same period a year earlier, although the latest result still came in at negative $730,000.
Revenue was up by 29 per cent, or $4.2 million, to $18.49 million.
TasFoods said the stronger revenue was due to increased sales in its dairy and poultry segments.
EBITDA was negative $237,000 in the first quarter and negative $493,000 in the second quarter.
TasFoods said the decline was due to mostly one-off items including new product development, selling and marketing activities related to new products and higher freight and distribution costs.
We are confident half one 2018 production cost savings will be sustained in half two 2018 and deliver continued improved gross profit performance.
- TasFoods
During the half-year, it said, it completed a review of operating costs and started a broad range of activities to optimise and reduce fixed costs.
“These initiatives have commenced generating savings, with improvements in gross margins commencing to flow through in (first-half) results,” it said.
“We are confident half one 2018 production cost savings will be sustained in half two 2018 and deliver continued improved gross profit performance.”
TasFoods said it had a strong cash position of $8.9 million on June 30.
The company’s highlights of the half-year included:
- Getting its premium Meander Valley Dairy 200 millilitre double cream product into 794 Coles stores nationally, with the first deliveries in the current quarter;
- launching nine fresh milk products under the rebranded Pyengana Dairy name into Coles, Woolworths and independent supermarkets in Tasmania, with weekly milk sales revenue up by 53 per cent since then;
- expanding dairy distribution on the mainland, with strong sales growth expected to follow; and
- expanding distribution of Nichols Poultry products in the big mainland capitals and in Tasmania.