A remarkable week for Elders on the stock exchange

Almost 10 million shares in the publicly listed company changed hands on the back of its better than forecast profit forecast.

As soon as Elders' management made that advice public at 9.31am on Monday, just before the Australian Stock Exchange opened for business, the shares caught fire.

In a normal week, Elders could expect around 2.5 million of its shares to be traded across four days.

Once that announcement sunk in, a 20 to 30 per cent expected lift in profit, investors piled in to the tune of 8.5 million shares traded in the first four days of the week.

The enthusiasm dipped a little on Friday, but only a little.

Elders' success even rated on the regular business roundup on the nightly news across most stations.

"The world is going crazy but agriculture is booming," one shareholder commented on social media.

The share price rose along with the demand - by at least a dollar to above the $13 mark.

That's a paper profit of around $10 million, or around $120 million in shares traded over those first four days.

It is a long way from those scary days of share raising and the like in 2013 as the company tried to stay afloat.

Ruralco (now part of Nutrien) unsuccessfully offered to buy Elders' rural services business for what was believed to be $250 million back then.

The second biggest shareholder, QBE, had just sold its stake in the company.

The takeover plan even went as far as winning Australian Competition and Consumer Commission approval before Elders held firm and Ruralco bailed.

The company's share price plunged to as low as six cents apiece.

Elders chairman Mark Allison took the seat vacated by former CEO Malcolm Jackman and since 2014 Elders has grown from a market capitalisation of $50 million to $1.9 billion.

Well, after this week's flurry on the ASX, the company is today valued at $2.1 billion.

One of the main reasons behind the surprise profit lift was because farmers have been racing into their Elders stores ahead of time to buy up critical farm inputs "seeking to mitigate the risk of instability in supply chains", according to Mr Allison.

"We have seen improvement in our retail and wholesale segments compared with the same time last financial year due to increased sales and favourable seasonal conditions in most parts of Australia," he told the ASX.

Elders now expects its profit this financial year will be up to a third higher than last year.

The agribusiness reported a $149.8 million profit last financial year, a 22pc rise on the year before.

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Mr Allison said it was now forecast the company's result would be 20 to 30 per cent above the earnings (before interest and tax) of the previous year.

The 2021 financial year result (EBIT) was $166.6m so the new forecast places the expected result at about $200-$216m for 2022.

Mr Allison said the profit guidance was an estimate as the company was only five months into its financial year.

"Our agency business continues to perform strongly as a result of high prices in both sheep and cattle, offset to some extent by lower volumes due to restocking and the good availability of feed on farm.

"Real estate is also exceeding expectations due to increased turnover and high demand," he said.

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