December 17, 2009

Losses force GrainCorp to close outlets

Agribusiness GrainCorp Ltd. will close eight of its 25 rural merchandise outlets, as they were incurring losses.

The eight outlets were small operations located in New South Wales and Victoria states that sold a range of merchandise including fertilisers and farm chemicals, said Corporate Affairs Manager David Ginns on Thursday.

In reporting a net profit for last fiscal year of A$63.2 million (US$56.2 million) on November 25, GrainCorp said its merchandise outlets had a difficult 2009, suffering a loss of A$23 million (US$20.5 million) before interest and tax, with an A$11 million (US$9.8 million) write down in the value of inventory, much of which was because of sharply lower fertiliser prices.

The company took an impairment charge on the assets, and began a strategic review of the merchandise business, about which further information is expected Friday, Ginns said.