Australia’s largest integrated protein producer, Inghams Group, recorded a solid 1H FY24 with a 268 per cent increase in net profit after tax (NPAT) to $63.4 million on the prior corresponding period, largely due to price increases in FY23 and early FY24.
Inghams CEO and managing director, Andrew Reeves, said, “Our interim results reflect the benefit of the price increases that were applied during FY23 and early FY24 in response to a significant growth in costs, modest volume growth, improved margins, and the continued improvement in operational performance in both farming and processing.
“The poultry sector remains attractive, with key long‐term trends intact, and while there has been a significant acceleration in inflation in recent times which has seen poultry prices rise, poultry continues to be the protein of choice and remains significantly more affordable than red meat.”
Snapshot
- EBITDA: $253.7m, up 28.8% on the prior corresponding period (pcp)
- NPAT: $63.4m, up 286.6% pcp
- Group core poultry sales volume: up 2.2% pcp
Revenue increased 8.7 per cent on pop to $1.64 billion, driven largely by growth in net selling prices (NSP) across all channels, reflecting NSP increases implemented in FY23 and early FY24 in response to increased costs. NSP in 1H24 are broadly in line with pricing level s reported for end 4Q23.
EBITDA increased 28.8 per cent on pop to $253.7 million, while underlying EBITDA pre AASB 16 increased 65.9 per cent to $138.4 million. NPAT increased 268.6 per cent pcp to $63.4 million.
Underlying costs grew at 6.9 per cent versus PCP, with internal feed cost increasing $10.8 million, while other costs increased $78.3 million due to growth in volume and inflation, partially offset by efficiencies and improvement in operational performance.
The focus on higher levels of automation is a key consideration for Inghams as part of its network analysis and planning. As part of the automation investment program announced in FY23, the acquisition of four modern leg deboning machines in Australia has been completed ahead of schedule and budget, with installation of all four new deboning machines completed in December 2023.
Higher levels of automation are also expected to deliver meaningful safety benefits by reducing labour in highly repetitive, labour-intensive roles, and thereby improving the overall health and wellbeing of our people.
Delivery and installation of four state‐of‐the‐art waterjet cutters in Australia remains on‐track and is expected to occur progressively into FY25.
Following the end of the period, Inghams’ new distribution centre in Hazelmere, WA, commenced operations. The Hazelmere facility is the third of a three‐facility investment program that has seen Inghams open new distribution centres at Truganina, Victoria, and Edinburgh Parks, Adelaide, in August 2022 and April 2023 respectively.
