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Business Description: Goodman Fielder Limited (GFF) manufactures and distributes food ingredients, consumer branded food, beverage, packaged bread, dairy products, small goods, flour, edible oils, meal components and other related goods to over 30,000 outlets every day including supermarkets, route outlets and food service customers. GFF manufactures its products in plants in Australia, New Zealand, Papua New Guinea, Fiji and New Caledonia.
Strategy Analysis: GFF says its 'guiding principles¬ī are: branded consumer products generate higher returns; brands provide effective insulation against commodity cost volatility; complex product and brand portfolios dilute the investment required to protect or grow market positions; and attractive returns are achievable in mature categories only where there is significant brand strength and/or a material delivered cost advantage, and where market conditions are stable. Within the focus on retail brands, the growth strategies are product innovation, bolt-on acquisitions, internal efficiencies and price recovery of commodity cost increases. GFF aims to be the lowest-cost producer in its categories. CEO Chris Delaney has initiated a strategic review focused on improving performance through Project Renaissance. He sees significant opportunities for innovation in the product portfolio, increased efficiency and supply chain improvements. While there appears room for significant improvement, the fact is that GFF is in a cyclical industry with some major structural challenges.
Goodman Fielder reported NPAT of $51m for the half-year ended 31 December 2012. Reported net profit included significant items of $9.8m (after tax), comprising the gain on sale of non-core businesses including Integro, less restructuring costs and provisions for asset sale costs. Revenues from ordinary activities were $1.17bn, down 9% from the same period last year. Basic and Diluted EPS was 2.6 cents compared to 1.4 cents last year. Net operating cash flow was $113.3m compared to $11.5m last year. No dividend was declared. Retail market conditions in the company's core markets of Australia and NZ are expected to remain challenging for the remainder of FY13, with competitive pressures continuing to put pressure on product volumes. In response, the company will continue its strong focus on operational cost control and disciplined capital management.
By Michael McCarthy (chief market strategist, CMC Markets) 19/12/2014 |
Traders and investors caught short heading into the FOMC scrambled for cover in Europe and the US, in many cases driving indices to their best one day performance for 2015.
By Betty Lam (Sales Trader, CMC Markets) 18/12/2014 |
Lead by the Fed-fervour offshore, Australians shares jumped on the Yellen cheer wagon. The material and energy stocks were back in vogue as both sectors gained over 3% in morning trade.
By Michael McCarthy (chief market strategist, CMC Markets) 18/12/2014 |
In spite of a frenzied pre-mortem, a benign statement from the US Federal Reserve‚Äôs Open Market Committee and steadying commodity markets drove investors back into share markets overnight. A calmer, stronger ruble helped offset European growth fears, highlighted in the overnight session by further declines in inflation.
By Betty Lam (Sales Trader, CMC Markets) 11/12/2014 |
Offshore jitters sent ripples through to Australian stocks. The open saw the local equities take 65 points off the index, catalysed by a mass-exit in energy stocks, yet again.
By Ric Spooner (Chief Market Analyst, CMC Markets) 10/12/2014 |
Yesterday‚Äôs news on Greek politics and China‚Äôs bond market came at a time when US and European stock markets have extended rallies and pushed valuations higher. This makes those markets vulnerable to downward corrections as profit takers act to avoid missing out.
BR Securities Australia Pty Ltd 2/12/2014 |
December 2014 could go down as a nasty moment in Australian finance. MYEFO will reveal a deteriorating budget deficit and the UNFCCC meeting in Lima, Peru will provide the agreement, to be ratified in Paris in 2015, on how much (or little) CO2 is to be allowed into the atmosphere from 2020.
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