WAMMCO profits fall amid record turnover

The West Australian Meat Marketing Cooperative's (WAMMCO) profits fell dramatically to $1.3 million for the year to June 30 depsite a record turnover, eclipsing the $100 million mark for the first time.

Record turnover of $108 million was reached due to an increased number of lambs and improved market returns.

WAMMCO said it managed to post the $1.3 million profit, after a pool bonus distribution to members of $750,000, in the face of WA's declining sheep numbers and tight overseas trading conditions.

However, WAMMCO managed to post a profit of $2.7 million FY2008 with a pool bonus of $1 million distributed to members.

WAMMCO said the profit fall indicates just how tough the conditions have been with fluctuating currencies and land prices moving all over the place.

Full announcement below:

WAMMCO delivers in tough year

The West Australian Meat Marketing Cooperative has returned a profit of $1.3 million after a pool bonus distribution to members of $750,000.

Chairman Dawson Bradford and Chief Executive Coll MacRury said the profit result was a creditable result in the face of WA's declining sheep numbers and tight overseas trading conditions.

The member pool bonus has been realigned to 3 per cent or $750,000 to return an average of $2.64 per head, but up to $5.27 per head to members for their qualifying lambs. Pool bonus entitlements will be distributed on December 1, 2009.

The profit was achieved on record turnover of $108 million (exceeding $100 million for the first time), with the higher turnover due to an increased number of lambs and improved market returns.

Lamb prices soared as prime lambs became scarce, lifting the average payment per lamb to $85.02, up nearly $20 from the previous year, with a minimal increase in the average carcase weight.

They said a similar declining sheep population in New Zealand would provide greater opportunities for Australia to benefit from the increasing global demand for lamb.

The WA sheep flock was now close to 17 million and competition between processors and the live shipping sector was becoming a case of "survival of the fittest."

WAMMCO's strategies were aligned to maximising members' livestock margins with the aim of rebuilding the flock.

Value adding to increase the returns per carcase was behind a $5 million investment in a new state-of the art boning room soon to be completed at Katanning. Increased yield incentives for more productive lambs had also been introduced in January under a system known as WAMMCO Select, paying members an extra five percent, equating to an average of $4.74 per qualifying lamb, but up to $7.20 per head.

Election

Mr Bradford said three nominations had been received before the August 14 closing date for a board vacancy caused by the retirement after a six year term of director Bruce Wright of Mt.Barker.

The nominations were Ms Lyn Slade, Mt.Barker, Ms Donna Lynch, Hyden and Mr Craig Heggaton, Kojonup.