Profit drops for ginger giant

Related tags Board of directors Stock

Margins erode for Australian ginger giant Buderim Ginger as the
company feels the impact of currency losses and wounded crops from
the 2003 drought.

The ginger group warned that it expects 2003 full year after-tax profit to plummet by almost 35 per cent on the previous year to $750,000, against $1,108,000 in 2002. But revenue is up, slightly, from $30.7 million from $30.5 million in 2002.

"The recent levelling out of the Australian dollar and the outlook for a much better 2004 ginger crop are obviously positives for us going forward,"​ the group told shareholders, later announcing that the dividend payout for 2003 would be halved.

Last year the Australian firm felt the financial squeeze of droughts - that also affected a large slice of the food industry - with the 2003 ginger crop proving more expensive to process.

With 60 per cent of revenue derived from export sales, Buderim's bottom line felt the full force of the rising Australian dollar.

For the six months to 30 June, 2003, Buderim posted a net loss of $133,000, compared with a loss of $131,000 previously. In 2002 Buderim reported a 40 per cent drop in net profit for the calender year to $770,000.

Troubled times with falling share price and sliding profits saw a boardroom coup at the company last year with three of the four board members who were nominated for replacement losing their positions. John Ruscoe - who led the company from 1982 to 1994 - stepped into the shoes of then chairman David Graham.

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