Livestock Improvement Corporation (LIC) H2 2024 earnings summary

Executive summary

• Revenue declined 3.3% year-over-year to $267.3 million, reflecting challenging market conditions and reduced activity in the milk sector.

• Net profit after tax dropped 71.7% to $7.7 million, impacted by lower bull valuations and a one-off tax adjustment.

• Underlying earnings fell 41.6% to $13.9 million, with total assets down 6.2% to $358.6 million.

• Ended the year with no debt, a modest profit, and dividend payouts, including a special dividend.

• Faced cost inflation, tax changes, and a semen quality issue resulting in over $2 million in credits to farmers.

Financial highlights

• Dividend of $8.3 million (5.84 cents per share), representing 60% of underlying earnings, plus a $18.5 million special dividend paid earlier.

• Bull team revaluation decreased to $88.9 million from $97.6 million last year.

• $2 million in credits paid to farmers due to a semen quality issue.

• No debt at year-end, maintaining a strong balance sheet.

• Research and development investment increased by 14.2% to $21.2 million, representing 7.9% of revenue.

Outlook and guidance

• Underlying earnings for 2024/25 projected at $16–22 million, assuming no major events or milk price changes.

• 2024/25 expected to remain volatile with ongoing cost pressures on farms and a difficult economic environment.

• Focus areas include operational excellence, genetic improvement, and software reliability.