AACO STEPS UP OPERATIONS ON MIXED FY17 RESULTS

AACO STEPS UP OPERATIONS ON MIXED FY17 RESULTS
THE Australian Agricultural Company (AACo) has harvested a mixed crop of FY17 results, increasing net profit by five percent to $71.5 million despite an 11 per cent revenue drop to $383 million.

Although the company's meat sale margin dropped by more than 10 per cent, on the other hand its operating EBITDA margin tripled to hit $45 million.

In a statement to the ASX, AACo noted that its operating EBITDA result eliminated potential distraction caused by unrealised cattle valuation adjustments, and is a better reflection of the company's actual financial performance.

AACo managing director Jason Strong says the company's end of year results reflect its strategy to build on its luxury beef brands in new markets.

"It is pleasing to see AACo's path of growth continue as a result of our intense focus on executing on the strategic plan we set out three years ago," says Strong.

"The improved financial results in FY17 are a result of our focus on investing in our brands, opening new market opportunities like we have done in Singapore, driving margin through our integrated supply chains and enhancing efficiency and product quality through innovation.

"We see great opportunity to continue to leverage our unique position as a luxury branded beef business, and expect further improvements in company performance through FY18."

Over the past financial year AACo has enjoyed a 12 per cent increase in the average meat sale price of Wagyu and Shortfed beef, as well as an overall 27 per cent decrease in production costs.

In the year ahead, the company aims to better its FY17 performance and continue to execute its long-term marketing, technology and supply chain improvement strategies across all its classic, modern and luxury beef ranges.

AACo remained at number 17 on Business News Australia's exclusive 2017 Brisbane Top Companies list.

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