Friday, March 29, 2024

Synlait Milk anticipates up to $30m loss

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Synlait Milk now expects to report a full-year net loss and said its banking syndicate has granted a waiver of relevant covenants. It is now tipping a net loss of between $20 million to $30m in the 12 months to July 31.
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In late March it was forecasting a “broadly breakeven FY21 NPAT result”. Net profit was $75.2m in the year to July 31, 2020.

The lower guidance is due to an expectation of ongoing shipping delays, which will result in the sale of some ingredient products occurring post the FY21 balance date, it said.

It also said it will achieve lower prices for ingredient products than Synlait would normally expect to achieve relative to prevailing market prices through a combination of sales phasing and volume pressure.

Finally, it pointed to the adoption of a more conservative approach to year-end inventory volumes and valuation.

“Synlait’s banking syndicate continues to be supportive and has granted a waiver of relevant covenants in FY21,”  it said.

It is now working constructively with the syndicate to ensure it has the appropriate funding for FY22, it said.

Synlait chief executive John Penno says he was disappointed to share this news with its investors.

Synlait does not intend to undertake a capital raising.

The shares last traded at $3.10 and have lost 56% over the past 12 months.

BusinessDesk

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