Goodman Fielder baking division takes $A300m hit
Goodman Fielder will take a $A300 million non-cash impairment charge on its baking division in its 2010/11 results, and has again downgraded profit guidance for the year.
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Goodman Fielder will take a $A300 million non-cash impairment charge on its baking division in its 2010/11 results, and has again downgraded profit guidance for the year.
The impairment followed weak trading in baking, the company said, and after earlier action to restore profitability had proven “inadequate”
“Goodman Fielder announced that, as a result of the weak trading in the baking division in Australia and New Zealand, the directors of Goodman Fielder have approved a non-cash impairment charge of $A300 million, which will be taken in the 2011 financial year accounts,” the company said in a statement.
As well, net profit for 2010/11 was expected now to be below guidance given in April of $A140-150 million.
Goodman Fielder said initiatives taken since April had not been enough to restore profitability.
“Following the April [guidance], the board approved a number of initiatives to improve performance which, while partially successful, have proved to be inadequate to restore an acceptable level of profitability,” Goodman Fielder said.
“Despite the company’s belief at the end of April that the fourth quarter would see an improvement on the third quarter, trading has remained subdued due to the continuation of unfavourable external and market conditions.
“Management underestimated the impact of these changed conditions and therefore the company’s initial response was inadequate.”
Goodman Fielders said its new CEO, Chris Delaney, had initiated a strategic review of operations aimed at improving the company’s performance.
“The strategic review is focused on addressing the company’s poor performance and unlocking Goodman Fielders significant potential,” Delaney said.
An update on the strategic review would be provided at the release of the company’s 2010/11 results on August 29.
NBR staff
Mon, 22 Aug 2011
Mon, 22 Aug 2011
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Goodman Fielder baking division takes $A300m hit
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