Inghams Group (ING) H2 2025 earnings summary

Executive summary

• Underlying EBITDA pre-AASB 16 was stable at AUD 236.4 million, with strong New Zealand growth from the Bostock Brothers acquisition offsetting Australian challenges, including cost-of-living pressures and Woolworths contract changes.

• Group core poultry volumes declined 1.4% year-over-year, with Australia down 2.5% and New Zealand up 5.2%.

• Leadership transition occurred as Andrew Reeves stepped down as CEO after guiding the company through the pandemic and returning it to profitability.

• Tight cost control and AUD 57.2 million in feed cost savings helped offset revenue and margin pressures, especially in Australia.

• Successful renewal of the Woolworths contract and customer diversification initiatives were completed.

Financial highlights

• Group revenue declined 1.5% to AUD 3.15 billion, mainly due to lower core poultry volumes, partially offset by a 0.5% increase in net selling price.

• As-reported EBITDA fell 15.3% to AUD 392 million, mainly due to a planned reduction in AASB 16 charges from contract grower conversions.

• Underlying EBITDA pre-AASB 16 was AUD 236.4 million (flat year-over-year); Australia contributed AUD 183.7 million (down 3.4%), New Zealand AUD 52.7 million (up 14.3%).

• Cash conversion remained strong at 97%, with cash flow from operations at AUD 319.3 million.

• Net debt increased by AUD 82.5 million to AUD 430.4 million, mainly due to the Bostock Brothers acquisition and capital expenditure.

Outlook and guidance

• FY 2026 underlying EBITDA pre-AASB 16 is guided at AUD 215–230 million, with earnings expected to be second-half weighted as cost-out and operational reset benefits materialize.

• Group core poultry volumes are expected to be slightly higher, with Australian growth in non-Woolworths retail and QSR, and continued strong performance in New Zealand.

• Net selling prices are expected to be slightly lower, and operating costs (excluding feed) to rise modestly, offset by cost reduction initiatives targeting AUD 60–80 million in annualized savings.

• Capital investment for FY 2026 is projected at AUD 80–100 million, focused on efficiency and automation.