Good results for Goodman Fielder ahead of sell off

by Chrystal Shannon
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SYDNEY, AUSTRALIA — The milling and baking operations of Goodman Fielder Ltd. showed improved sales and earnings in the six months ending Dec. 31, 2001.

Milling and Baking Australia, Goodman Fielder’s largest business that includes Allied flour mills and Quality Bakers Australia, had earnings before interest and taxes of A$36 million (U.S.$18.9 million) in the first half of fiscal 2002, compared with A$33 million in the six months of the previous year. The segment’s sales increased to A$509 million ($270 million) from A$500.6 million.

New Zealand, including the Goodman Fielder milling and Quality Bakers businesses, posted EBIT of A$34.4 million on sales of A$256.9 million in the first half of fiscal 2002, up from A$34 million and A$242.3 million, respectively, in the first six months of the previous year.

Net operating profit of Goodman Fielder in the first half totaled A$68.4 million, up 19% from A$57.5 million in the year-ago six months. Net sales totaled A$1,539 million, up slightly from A$1,533 million.

Tom Park, Goodman Fielder chief executive, said he was pleased with the progress on a number of initiatives identified in the strategic action plan last year, including the sale of non-core businesses, working core assets harder and improved capital management. "Goodman Fielder intends to become the leading retail branded food business in Australasia," Park added.

In December, Park said the company intended to find a strategic partner for its milling and commercial mixing business. All or part of the flour milling, bread improvers and commercial mixing operations were among options being considered for divestment. A memorandum of information was issued to interested domestic and international companies in January. Analysts expect the businesses to be sold later in the year for around A$200 million (U.S.$106 million).

Among companies said to be showing interest are the Australian subsidiary of U.S. commodities giant, Cargill; George Weston Foods, who recently sold its Bioproduct assets and the Narranderra flour mill for A$47.3 million (U.S.$24.86 million); and wheat exporter AWB Ltd.