Manufacturer, marketer and distributor Goodman Fielder has issued a profit downgrade and warned the company is expecting write-downs in the second half.
The company said profits have dropped due to a lower selling price for baked goods, poor performance from its groceries division and higher farmgate milk prices, the Sydney Morning Herald reports.
Earnings have come up to $27 million lower than its previous full-year profit guidance of around $180 million.
In February, Goodman Fielder stated it was confident that full-year profits would be broadly in line with last financial year, despite reporting a loss of $64.8 million.
The company said it would conduct detailed analysis of the carrying value of its businesses.
The announcement follows yesterday’s confirmation of the sale of Goodman Fielder’s meats business in New Zealand to Hellers Limited.
Winemaker Treasury Wine Estates has also experienced financial struggles recently, with chairman, Paul Rayner attributing its recent write-down of $154.3 million to poor reporting systems.
TWE’s management systems were not set up to assess how much commercial wine – which does not age well – was sitting idle on distributers’ shelves, The Australian reports.
The reporting oversight led the destruction of almost 600,000 cases of old wine costing $34 million, and a further $82.4 million write-down on the value of bulk wine which was sold at fire sale prices.