Wellard making good on banking obligations

Wellard making good on banking obligations


Wellard managing director, Mauro Balzarini, says events leading up to Wellard’s financial stresses in 2016 were a perfect storm.

Wellard managing director, Mauro Balzarini, says events leading up to Wellard’s financial stresses in 2016 were a perfect storm.

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Livestock exporter Wellard has been quick to honour a commitment to find solutions to its breached working capital loan covenant undertakings.

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Livestock exporter Wellard has been quick to honour this week’s annual general meeting commitment to find solutions to its breached working capital loan covenant undertakings.

Wellard has confirmed it has remedied its November 30 banking covenant breach by including a number of its overseas subsidiaries as obligors under the working capital facility.

It is still in talks with its bankers and confident it will fix the remaining breach prior to February 28.

Managing director, Mauro Balzarini told the annual general meeting the company still was still making money and he hoped the worst was behind it.

Chairman David Griffiths said it was clearly evident Wellard had endured a challenging start to listed life during the past 12 months.

Earnings forecasts have been torpedoed by a succession of un-budgeted shipping costs, high cattle purchase costs and a eroded sales opportunities.

"When it became apparent to Wellard that these factors would cause Wellard to miss its prospectus forecast the company advised the market, and advised it again when our forecast was lowered again when the supply and price situation worsened,'' Mr Griffiths said.

Mr Balzarini described the events leading up to Wellard’s financial stresses during 2016 as the perfect storm.

“So many things went wrong that haven't gone wrong in my whole career,'' he said.

"I think the worst is over.

“I think China is going to be significant in the second half of this financial year and producers can't restock forever, so cattle will become available."

Mr Griffiths confirmed Wellard had been approached to sell assets.

"People have approached us wanting to buy a ship," he said.

"We have engaged to see if that's what we want to do.”

The company’s share price has made a modest recovery since Tuesday’s meeting, lifting from 19.5 cents to 21.5c.

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