TasFoods Limited lost $1.27 million after tax in the six months to June 30, in a much improved performance.
The Tasmanian agribusiness recorded an after tax loss of $1.83 million in the same period a year earlier.
Comparing the half-years, sales revenue improved by 29 per cent to $18.48 million.
Earnings before interest, tax, depreciation and amortisation improved from negative $1.43 million to negative $730,000.
Executive chairman Shane Noble said the results reflected a strategic growth plan aimed at improving group performance in 2017-18 and creating a platform for continued growth this financial year.
He said increasing scale through revenue growth and relocation of processing lines were TasFoods’ key focus areas in the first half of 2018.
“This, coupled with the automation of a key production process line completed in late … 2017, has generated strong improvement in labour efficiencies,” Mr Noble said.
“The productivity improvements have provided us with the ability to deliver revenue growth whilst minimising additional labour, resulting in improved gross profit performance.
“We are also half-way through a capital investment of $2.5 million at Nichols Poultry, our largest operation.”
He said the investment in a new air chiller would allow Nichols to expand production by up to 50 per cent while continuing to deliver superior quality.
He said TasFoods was entering new contracts to expand its chicken growing network to make sure supply kept pace with growing demand.
The company had net assets of $34.2 million on June 30, including cash and cash equivalents of $8.9 million.
“This positions TasFoods well to consider opportunities that will advance our strategic direction and deliver shareholder growth,” Mr Noble said.
The revenue growth was built on a 233 per cent sales increase for the dairy section of the business and an 18 per cent increase in poultry sales.
The high revenue growth from dairy was largely due to the acquisition of Pyengana Dairy in October 2017.
Taking that operation out of the figures, the company still achieved 18 per cent growth in dairy sales.
TasFoods raised $4 million through a share purchase plan which was completed in February and the second part of a share placement to sophisticated and institutional investors which was announced in December.
Some of the funds were used to expand production capacity at the Meander Valley Dairy factory and at Nichols, and some for general working capital.