AUSTRALIA – Australia’s leading grain merchant, CBH Group has reported 9% increase in revenue to US$2.69 billion (A$3.8 billion), driven by higher year-on-year grain prices in the year ended 30 September 2018.
The group saw higher tonnes traded by CBH Marketing and Trading, partially offset by lower grain handling and freight revenue.
The company said good performance in the year was attributed to strong contributions from the Operations and Marketing and Trading divisions, while much needed investment in the supply chain more than doubled.
In the twelve-months period, group surplus before rebates was A$128 million (US$90.91 million), majority of which was passed back to growers in the form of a US$67.45 million rebate, resulting in Net Profit after Tax and Rebates of US$23.43 million.
This was as a result of the group’s focus on improving service for growers as well as reducing costs during the year.
“It’s pleasing to see that we can continue to deliver strong financial results year-on-year for our grower members.
“Throughout the year, we have been focused on progressing towards a smarter, leaner and healthier organisation so we can give our growers every advantage to keep them internationally competitive,” said Chief Executive Officer Jimmy Wilson.
“We also continued to optimize our storage and handling network, investing significantly to improve the service and efficiency of our sites, make our fees even more competitive and deliver tonnes to port when its most needed.”
During the year, CBH invested US$150.58 million (A$212 million) into network capital and maintenance including adding 650,000 tonnes of permanent storage and construction of 1.1 million tonnes of emergency storage.
Operations division received 13.3 million tonnes of grain amidst mixed weather conditions.
New digital service options such as the CDF app and Paddock Planner were rolled out for growers, which helped with planning and efficiency gains in the grains business.
The Marketing and Trading division reported continued growth for CBH Fertiliser, with tonnes sold increasing 45% to 90,000 tonnes in the 12 months to the end of September.
Interflour, a joint venture which is 50%-owned by CBH, reported a loss for the first time since CBH acquired its interest in 2005, attributed to challenging trading conditions stemming from a highly competitive flour milling industry in Asia and adverse currency movements.
Looking into the future, Jimmy Wilson said: “We remain committed to reducing paddock to port costs for our growers and working towards our goal of removing ongoing costs of more than $100 million from the business.
“In addition, we are continuing the elevated work pace on the Network improvement to deliver an optimal supply chain and help keep our growers internationally competitive.”