Australian Agricultural Company (AAco) has issued a warning that recent heavy rainfall and subsequent flooding across parts of Queensland are likely to impact its earnings. Three of the company’s 27 cattle stations have been affected by the severe weather event. AAco manages a herd of approximately 456,000 cattle. The company said that the affected Carrum, Dalgonally and Canobie aggregations held 55,000 cattle between them. AAco is one of Australia’s largest integrated cattle and beef producers. The company owns and operates a strategic balance of properties, feedlots, and processing facilities.
In a statement to the market, AAco noted that the number of livestock in the affected region was significantly lower than during the 2019 floods. However, the company said it was too early to determine the full extent of the losses, stating that they were likely to be material. The current conditions remain challenging, making a credible assessment of the impact on livestock and infrastructure difficult to undertake at this time. AAco also noted that there remains the possibility of further wet season impacts.
Despite the potential financial setback, AAco has confirmed that it does not hold insurance for its herd and infrastructure against flooding events. However, the company reassured investors that its balance sheet and overall financial position remain strong. The company will provide further updates as the situation evolves and a more accurate assessment of the damages can be made.
