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Australian Investment Blog

ASX:ING 28/08/2019

Inghams (ING) overcooks the chook

Inghams (ING) – 17.08%:  The poultry producer continued the run of poor results from agricultural businesses today with FY19 earnings missing expectations,  however the magnitude of the share price fall was more a consequence of weaker guidance for the year ahead. The key takeaways came more from the operational / cost side rather than the demand side, with poultry volumes up +4.3% yoy to a pretty staggering 414.9k tonnes. For FY19, EBITDA grew by +2.9% to $208.6m however that was below the $212m expected by the market while the profit line missed expectations by a larger margin. They sighted the impost of higher feed prices thanks to the drought while they also discussed poor results from a processing optimisation program that was desired to reduce costs, but instead, higher demand meant the new arrangements couldn’t cope and the opposite outcome occurred. In terms of guidance, the market was  looking for +2% growth in EBITDA for FY20, however the company said EBITDA will be lower in FY20 before it rebounds in FY21. Inghams (ING) Chart Inghams Group Daily Chart

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