PUBLICLY-listed live exporter Wellard has announced its third consecutive profit downgrade.
On Monday, the Fremantle-based company informed its shareholders of the profit downgrade in a report to the Australian Securities Exchange (ASX) and lifted its voluntary trading suspension.
Wellard has until the end of the month to release its full audited accounts for the 2015/16 financial year, after announcing it forecast a full year net profit estimated at about $14 million to $15m for the year until June 30.
This was a sharp reversion from June's expectation of $23.5m-$30m.
Its prospectus, issued before listing, forecast full-year profits of $46.4m.
In the latest update on Monday, Wellard said the downgrade resulted from adjustments including to vessel spares inventory, insurance claims and tax.
The main issue was $7.7m for repairs to the M/V Ocean Swagman and M/V Ocean Outback, due to mechanical breakdowns earlier this year.
Wellard has filed an insurance claim for the costs, but said progress on the claim would not be sufficient to consider it in the full year accounts later this month.
"Wellard has notified its insurer and is making a claim with respect to the breakdowns," it said.
"The claim involves two ships and is complex and it is expected that it will not have advanced sufficiently to be included in the Wellard audited financial statements for FY2016 at the end of August.
"Although Wellard is confident in the recovery, it is not in a position to say if the claim will succeed and if so for what amount, after the subtraction of deductibles."
Wellard managing director Mauro Balzarini said the company was experiencing challenging times.
"It has been a challenging six months for our company, with a difficult trading environment and a number of unexpected events," he said.
"Despite this Wellard has maintained its market position and increased market share in some countries and all our ships are being utilised."
Wellard said it was completing a review of its assets to determine if any adjustments were required.
"Wellard intends to lodge the audited financial statements for the year ended June 30, 2016, on or about August 31," it said.
Since it floated on the ASX last year on the back of a $298.9m initial public offering, the company has had a bumpy ride with breakdowns and a difficult trading environment.
It listed in December at $1.39 a share, which valued it at $560m, but on Monday shares were down to 38 cents.
Jacinta Bolsenbroek
Senior journalist at Farm Weekly.
Senior journalist at Farm Weekly.
