Elders (ASX: $ELD) Half-Year Results Overview

Australian agribusiness Elders (ASX: $ELD) has reported a half-year underlying earnings before interest and tax (EBIT) of $38.4 million for the six months ending on 31 March 2024. The company also announced an interim dividend of 18.0 cents per share, 50% franked, and has reaffirmed its full year underlying EBIT guidance to be between $120 million and $140 million.

Executive Commentary on HY24 Performance

Elders' Managing Director and CEO, Mr Allison, stated, 'Elders was impacted in the first half by below average seasonal conditions, resulting in subdued client sentiment and lower crop protection and livestock prices against the prior period. Earnings improved in the second quarter, in line with a more favourable operating environment, and we are confident in a stronger second half with a return to average seasonal conditions and improved outlook for winter crop and livestock production.'

Summary of Elders' HY24 Results and FY24 Outlook

Elders' half-year results were influenced by challenging seasonal conditions, cautious client sentiment, softening crop input prices, and lower livestock prices. However, the second quarter saw an uplift in client sentiment and improved trading, supported by un-forecast widespread rainfall across many regions in eastern and southern Australia. The company experienced a reduction in total recordable injury frequency rate and has determined to pay an interim dividend of 18.0 cents per share, 50% franked. Looking ahead, Elders expects better trading conditions in the second half of FY24, with a focus on strategic initiatives and maintaining cost and capital efficiency. The company anticipates a positive impact on the Rural Products business due to a return to average seasonal conditions and improved sentiment, and forecasts a positive outlook for Agency Services and Real Estate. Financial Services is expected to continue benefiting from equity accounted investments, while the company remains cautious due to potential supply chain disruptions and unexpected changes in seasonal conditions and commodity prices.