WCB trading update predicts doubling profit in 2014
Victorian-based dairy company Warrnambool Cheese and Butter (WCB) has announced it expects EBITDA for the 2014 financial year to be in the range of $47 million to $52 million, up from the EBITDA $25.5 million recorded in 2013.
WCB said the improved forecast was due to a continuation of the improvement in market conditions experienced in the last quarter of the 2013 financial year, as well as business improvement and strategic initiatives, which were contributing to a positive product mix and higher margins.
Full details of the final Directors’ forecast, including the underlying assumptions, sensitivities and risks that impact the forecast, as well as the full year impact of strategic initiatives, will be provided in WCB’s forthcoming Target’s Statement. The Statement will be a response to the take-over offer from Bega Cheese, which shareholders will receive in mid-October. Australian Food News reported in September 2013 that WCB’s Directors had recommended shareholders reject Bega’s offer.
WCB said the Target’s Statement will include the Investigating Accountant’s Report, which will be completed in relation to WCB’s forecast for the 2014 financial year. The Company said this will assist its shareholders to properly assess the future profitability of WCB.
“The continuation of improved trading conditions and overall business performance highlighted in the 30 July 2013 Trading Updated and described in detail in the 2013 financial year results announcement will contribute to substantially improved earnings in the 2014 financial year,” said David Lord, WCB CEO.
“This improved earnings outlook is another reason why WCB is recommending that WCB shareholders reject Bega’s inadequate offer for their WCB shares,” Mr Lord said.