Wellard sells assets for $17.5m

Wellard has sold its Wongan Hills feed mill, and Baldivis pre-export quarantine lease in Western Australia, as well as its Condah pre-export quarantine facility in Victoria, to Ausvision Rural Services.

In a statement, the livestock exporter said it also reached an agreement to sell its Beaufort River Meats abattoir in WA to Ausvision, which is a subsidiary of Livestock Shipping Services, after the original buyer defaulted on its sales contract.

The Beaufort River transaction is expected to be completed by the end of April, and Wellard retained the deposit from the original contract.

The company said $17.5 million in free cash flow will be realised from these combined asset sales.

In December, Wellard estimated estimated it would generate $13 million of free cash flow from the asset sales, but that amount did not include the sale of its Condah facility.

Today, it also announced it would redeem a minimum $US500,000 of convertible notes per month as part of a standstill agreement with its noteholders.

In February, the company posted a $2.9 million profit for the six months to December, up from a $7.4 million loss in the previous corresponding period, and its first profit since listing on the ASX over three years ago.

Shares in Wellard were flat at 5.4 cents each at 2pm AEDT, it listed on the ASX in December 2015 at $1.44 each.