Australia's largest beef producer has been hit hard by falls in cattle prices.
Publicly-listed Australian Agricultural Company has posted a statutory loss of $105.5 million in its half-yearly update to shareholders today.
The falls are chiefly from the write-down in the book value of its enormous herd of around 430,000 head.
AACo operates an integrated cattle production system across 19 cattle stations, two farms, two feedlots as well as three leased stations and one leased farm throughout Queensland and the Northern Territory.
The company remains bullish about its performance however given that revenue is up and so are operating profits.
Already Australia's oldest continuously operated company - AACo has now entered its 200th year.
Managing director David Harris said volumes of meat sales are up.
In particular, its key Wagyu beef sales were up 15 per cent.
Net revenue was $167.1 million, a slight rise in the previous reporting period.
The company's statutory net losses after tax were $105.5 million, against a posted profit of $51.6 million the year before.
Its operating profit for the first half of the year was $30.1 million "despite a challenging operating environment".
The company said its strategy of focussing of selling beef under premium brands was paying off and had helped it "withstand unfavourable market conditions".
Cattle prices are today at four-year lows, the company said.
Its cattle sales were down "in line with market conditions" partially offset by higher increased volumes of 20pc.
"... the reduction in cattle prices has an impact on our balance sheet and statutory performance, it is reflective of the herd value at a point in time and has a limited impact on our operating income and cash flows".
Mr Harris said the results place AACo in a "good position" to navigate challenging global conditions.
The company said overall meat sales revenue rose by $9.5 million with sales volumes up 15pc.
It said the Westholme and Darling Downs brands remain strong globally and the Darling Downs brand in particular was a household name in South Korea.
Mr Harris said the company was continuing to develop its assets particularly through dryland cropping trials on 6000 hectares (14,826 acres) on two of its north Queensland properties.
"The initial results are positive and the program will aim to continue unlocking further farming potential in the region," he said.
He said AACo had invested heavily in infrastructure in recent times with an emphasis on water upgrades with a continued program to convert bore diesel pumps to solar.
It has also boosted the capacity of its Goonoo feedlot.
There were few questions to management from shareholders although one investor asked whether AACo was considering paying dividends on shares in the next year.
The company hasn't paid dividends for 14 years with a policy of using profits to invest in what they have described as a "capital-hungry business".
Mr Harris said he would leave decisions on dividends to the board.
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