Goodman Fielder Ltd., Australia’s largest baker, said first-half profit rose 25 percent after cutting manufacturing expenses and adding new bread brands.
Less volatile commodity prices, which reduced the need to change selling prices, stoked profitability in baking as the company added new bread products such as Helga’s Seed Sensations. The company is focusing on branded products for consumers after last year agreeing to sell its commercial oils unit to Cargill Inc. amid increased wholesale competition.
“The business is continuing to perform solidly into the second half of the financial year and is experiencing a more moderate commodity cost environment,” the company said.
The company didn’t issue a forecast for annual earnings.
The shares dropped 6.5 Australian cents, or 4.2 percent, to A$1.48 as the close of trading in Sydney. The stock gained 23 percent last year, its first annual gain in three years.
Sales fell 7.5 percent to A$1.4 billion.
First-half bakery earnings before interest, tax, depreciation and amortization rose 32 percent to A$72.7 million.
The dairy and meat business had a 70 percent rise in profit to A$31 million.
The home ingredients unit, which includes Paradise biscuits, posted a 4.2 percent increase in profit to A$51.8 million.
Source: www.businessweek.com