Wellard working on breached covenants

Livestock exporter Wellard has confirmed it has again breached banking covenants, and expects a loss for the first half of the 2017 financial year.

But the climate is expected to improve later in the year, with Wellard forecasting a profit in the six months to June.

The covenants for its banking facility were breached on December 31, with the company saying it was working with finance providers to secure a waiver or amendment.

The company had previously warned the covenants were likely to be breached.

Wellard first breached covenants relating to a working capital facility on June 30 and then again on September 30, however both were waived.

Business News has previously reported that the company has a working capital facility with Commonwealth Bank of Australia  worth between $10 million and $15 million, and a larger asset financing deal for its ships.

The company had a rough first year after listing on the ASX in December 2015.

At its annual general meeting in November, shareholders rejected four resolutions, including the remuneration report, which received a first strike.

The company reported an increase in revenue from $512.3 million to $574 million for the year to June, below forecast.

Higher costs of sales led to a total comprehensive loss of $34 million, and a statutory loss of $23.3 million.

Shares in Wellard were down 2.2 per cent to 22.2 cents each at the close of trading.