Diversified animal nutrition business Ridley Corporation was hit by drought conditions across eastern Australia during 2019 but reported steady earnings after a recovery late in the year.
The company reported an operating EBITDA of $30.7 million for the first half of the year after providing $7.2 million for the closure of a feed mill at Murray Bridge and $2.9 million on internal business restructuring.
This is roughly in line with the previous corresponding quarter.
The producer of major animal feed brands Barastoc, Cobber, Rumevite, and Primo, Ridley suffered a slow start to the year and then a pick up in volumes as it switched to supplementary drought feeds.
During the half Ridley restructured its businesses, reducing costs by $6.5 million a year by closing the Murray Bridge mill which was under-utilised.
Managing director Tim Hart said the company had been pursuing a number of business optimisation initiatives, simplifying operations, installing automation, rationalising its supply chain and leveraging its raw material procurement.
Hart said: “The new structure was motivated by more than just overhead savings and has been designed to drive sales growth.
“This is achieved by assigning a single point of accountability for both the customer servicing and the operation of the supplying facility.”
Ridley provides complete rations, mineral concentrates, nutritional blocks and supplements for a wide range of species, including dairy cows, poultry, pig, beef, horse, sheep and dogs.
The company’s lead innovation is Novacq, a metabolic stimulant when included in prawn feed diets.
The company has purchased 50 hectares of land in Thailand encompassing the existing Novacq production ponds and the remaining 51 per cent of the nearby Pen Ngern feed mill.
“These production facilities provide the ideal footprint for the long-term expansion of Novacq operations in Thailand and the foundation to supply Novacq and prawn feed to prawn producers in the Asia Pacific and Middle East regions.”
The company anticipates reduced sales in supplementary stock feeding following recent rains, but growth across poultry, pig, dairy and aquafeed sectors.
Picture: Ridley Corporation
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