Viterra Fourth Quarter Sales Drops By 17.6%
Viterra Inc. as well as other agricultural products experienced dramatic drop on sales. Viterra Inc. loss due to higher cost incurred by their market integration and commodity prices decline.
Viterra Inc. year-early profit of $46.8 million from grain handling and marketing does not seem to reflect in the fourth quarter as its revenue dropped by 17.6%.
The loss was pointed to a decline in commodity prices which were way too low from record highs and to the higher cost of its expansion into the Australian market.Recorded also is a small loss of $900,000 equivalent to less than a cent per share as compared to $46.8 million or 20 cents a share a year earlier.
On the other hand, Viterra's chief executive stressed that 2009 is quit a good year for the company due to solid financial conditions which actually prepared them for future expansion.He also said that they had completed the year strong by having a more stable financial status retaining more than $1 billion of cash and short-term investments and $800 million reserved for future growth initiatives.
Viterra's profit had been affected in the fourth quarter due to the increase in their financing expenses and higher cost incurred by the integration of acquired companies which cost them $5.1 million during the quarter.
In addition, in the fourth quarter of 2008, their financing expenses reached $24.1 million from just $6.3 million which is four times higher. They also issued last July $300 million of notes of interest expense wherein $100 million was drawn on a term facility and Viterra Australia's financing costs.
Viterra's sales and operating revenue went down to $986.4 million which was nearly 17 per cent from $1.82 million year before.On a larger perspective, sales of agricultural products was not even performing too well as sales drop to $240.1 million from $308 million in the fourth quarter of fiscal 2008 which is 22 per cent decline.
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