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Affco turns to NZ$60.2 mln profit on one-time gain, trading

Thursday 27th November 2008

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AFFCO Holdings, the meat company that has outperformed the NZX 50 Index this year, turned to a full-year profit after a pick up in sales in the second half and a one-time gain from Dairy Trust.

Net income was NZ$60.2 million in the 12 months ended Sept. 30, from a loss of NZ$1.77 million a year earlier, the company said in a statement.

AFFCO said NZ$40.8 million of the full-year profit came from a pick-up in trading activities. The company said it maintained market share in beef and lamb, and gained more of the market for the venison kill. Revenue rose 15% to NZ$1.1 billion.

The remaining third of the company's full year profit, NZ$19.4 million, came from a gain in value in AFFCO's shareholding of Dairy Trust, after that company's successful takeover of Open Country Cheese Company.

Chief executive Stuart Weston said AFFCO benefited from its continued focus on repaying debt, as well as its strategy of being a broader food group.

The shares were unchanged at 40 cents today and have gained 20% this year, while the NZX 50 fell 32%.

By Jonathan Underhill

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