Insights

Elders (ASX:ELD) share price slips on half-year results

The Elders Ltd (ASX: ELD) share price is in the red after the release of its half-year results for the six months ending 31 March 2021.
The post Elders (ASX:ELD) share price slips on half-year results appeared first on The Motley Fool Australia. –

worried famer looks at his computer in front of a harvester, indicating poor prices on the share market

The Elders Ltd (ASX: ELD) share price is in the red today. The agribusiness comes into focus after releasing its half-year results for the six months to 31 March 2021.

At the time of writing, shares in the company are trading for $11.87 – down 2.95%. By comparison, the S&P/ASX 200 Index is 0.54% higher.

Let’s take a closer look at the results and what they mean for the Elders share price.

Elders half-year results

In today’s release, Elders reports underlying profit after tax is up 31% on the prior corresponding period (pcp) to $68.2 million. Total sales for the six-month period are $1.1 billion, which is 22% higher than the first half of FY20.

Underlying earnings before interest, taxes, depreciation, and amortisation (EBITDA) increased 28% to equal $94.3 million. Underlying earnings per share (EPS) are up 38% on the pcp to 42.9 cents. The company will pay a 20-cent interim dividend per share to shareholders, 20% franked. In the first half of FY20, the company paid a 9-cent dividend, fully franked.

The biggest drivers of the growing profit were an $18 million increase in the margin of retail products and $11.9 million for wholesale products. Costs were up $16.5 million on the pcp. Elders attributed this to “acquisitions, higher insurance costs, investment in strategic areas and systems modernisation expenses”.

Despite these positive figures, the Elders share price is heading south today.

In a separate statement to the ASX, Elders said the results were due to a variety of factors, including a backward integration strategy that boosted retail sales, encouraging weather conditions (which it expects to continue in the short term), and favourable commodity prices.

The Australian Bureau of Statistics (ABS) supports this view of favourable growing conditions when compared to the previous financial year.

In FY20, the total value of crops produced decreased by 5% compared to the previous year. This was driven largely by a 20% drop in the value of wheat production and a 78% fall in the value of cotton production. Operating cash flow was down 13% on the pcp to $23.9 million. Total cash flow for the period was a $21.2 million outflow. In the pcp, it was a total inflow of $55.4 million. Elders says the drop in operating cash flow is due to increased working capital in rural production. Financing cash flows fell 115% into the red (-$19.8 billion) to drive the total cash flow loss.

Elders share price snapshot

Over the past 12 months, the Elders share price has increased 23.7%. Only last week, Goldman Sachs put a buy-rating on Elders shares, with a target price of $15.00.

Elders has a market capitalisation of $1.8 billion.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of February 15th 2021

More reading

Motley Fool contributor Marc Sidarous has no position in any of the stocks mentioned. The Motley Fool Australia has recommended Elders Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Elders (ASX:ELD) share price slips on half-year results appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!