Allied Farmers (ALF) ASM Presentation 2023 summary

Financial performance and results

• Net profit after tax for FY2023 was $3.338m, up 16.06% from FY2022, driven by increased returns from NZ Farmers Livestock, especially meat processing, but offset by lower NZ Rural Land Management fees.

• Earnings per share rose 16.1% to 11.59 cents; net tangible assets per share were $0.21, reflecting changes in asset mix and ownership.

• NZ Farmers Livestock business areas achieved consolidated earnings 41.1% ahead of the prior year, with strong veal and finance results.

• Allied Farmers has a significant tax loss asset, with unrecognised deferred tax assets totaling $180.8m as of June 2023, following a favorable Inland Revenue ruling.

• Dividend per share was 1.2 cents, down from 2.0 cents in FY2022.

Business operations and investments

• Acquired the remaining 50% of NZ Rural Land Management (NZRLM) for $8.3m, bringing total acquisition cost to $10.8m, below the PwC valuation of $16.6m.

• NZRLM manages NZ Rural Land Company (NZL), which owns 14,847 hectares of rural land, up 3,137 hectares in FY23.

• Allied Farmers owns about 2% of NZL shares, with half escrowed for five years.

• NZ Farmers Livestock continued to develop digital auction tools and grew its finance business, supporting clients in a challenging environment.

• The group is working with Deloitte to simplify its corporate structure and amalgamate legacy companies.

Governance and shareholder matters

• Shelley Ruha appointed Chair in April 2023, with Richard Milsom as Managing Director since April 2023.

• Board includes experienced directors with backgrounds in agriculture, finance, and governance.

• Shareholders re-elected Richard Milsom as Managing Director and approved the re-appointment of RSM Hayes Audit as auditor, with strong majority votes.

• Directors are focused on maintaining shareholder continuity to preserve tax loss assets.

• The company is committed to supporting clients and future-proofing its core livestock agency business.