Alliance Group makes net loss of $50.8m

Last updated 05:00 10/11/2012

Relevant offers


Samu Kerevi out, Marika Koroibete in for Wallabies' European tour Irish rugby team urged to dump Donald Trump's Chicago hotel for All Blacks test Storm star Marika Koroibete to get Wallabies call-up for spring tour Andrew Mehrtens offside with George Gregan over Wallabies' no-try award Joe Schmidt has All Blacks in his sights as he recommits to Ireland till 2019 Liam Napier: Michael Cheika must learn to control his short fuse Springboks coach Allister Coetzee full of praise for England ahead of test All Blacks coach Steve Hansen offers olive branch to Wallabies counterpart Michael Cheika Silver Ferns shooter Maria Tutaia gets engaged to Wallabies star Israel Folau Munster honour late captain and coach Anthony Foley with big win over Glasgow

Southland sheepmeat processor and exporter Alliance Group has reported a $50.8 million net loss for the year ending September 30 - its first operating loss in 20 years.

As a result, its farmer suppliers will not receive any distribution payments this year.

The decision to cease sheepmeat operations at the Mataura plant, which set the company back $13.5m in restructuring costs, contributed to the loss.

Alliance Group chairman Owen Poole said the loss reflected a substantial change in New Zealand's sheepmeat export markets because of the widespread economic crisis and a strong New Zealand dollar.

"We accept that many exporters and processors like ourselves did not respond to the changing economic environment fast enough and, in an intensely competitive industry, continued to pay too much for livestock for too long," he said.

Despite the loss, the company had made several investments to help with costs, including a $15m upgrade of the beef processing at Mataura, he said.

The company anticipated a much better financial result next year, Mr Poole said.

Federated Farmers Southland meat and fibre spokesman and Alliance supplier Andrew Morrison said he did not expect to see such a significant loss.

Farmers were likely to criticise the company for poor performance but at the end of the day the money ended up in the farmers' pockets because they were paid more for their livestock, he said.

It would be interesting to see if Southland meat companies would work closer together, as suggested in the red meat sector strategy, he said.

The strategy addressed aligned procurement and market co-ordination. "It'll be good to see if they've got the appetite to address either of those issues," he said.

Beef + Lamb New Zealand economic service executive director Rob Davison said Southland processors were forecast to pay about $20 less per head of prime lamb next season.

Blue Sky Meats also reported a net loss after tax, of $449,000, for the year ending March 31.

Ad Feedback

- The Southland Times

Special offers
Opinion poll

Who was the better Springboks lock?

Bakkies Botha

Victor Matfield

Vote Result

Featured Promotions

Sponsored Content