Reid Farmers exceeds forecast

By Phil Boeyen, ShareChat Business News Editor

Monday 26th February 2001

Rural services company Reid Farmers (NZSE: REI) has more than doubled its own profit expectations by posting an interim net surplus of $2.66 million for the six months to the end of December.

The result is 62% higher than the previous year's profit of $1.64 million, when the company had only budgeted for a 30% improvement.

It says all business units reported improved earnings.

"Our commitment to the rural servicing industry during the years in which it was out of favour is now providing the anticipated benefits with record levels of activity and results."

Sales grew to $54 million from $42 million the previous year, reflecting such factors as improved market share in rural real estate sales and a 20% increase in sales of farm supplies.

The company also had increased volumes through its wool broking and wool scouring operations, which it says represents the increased focus placed on wool activities since the wool operations were restructured in the second quarter of 2000.

Although no interim dividend has been declared the company says the positive rural outlook should help achieve another improved annual result.

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