GrainCorp reported a robust first half of FY25 with improved earnings and upgraded guidance, underpinned by strong East Coast grain volumes and operational resilience.
- Underlying EBITDA rose to $202 million in 1H25
- Underlying NPAT increased to $69 million
- FY25 earnings guidance upgraded to $285-325 million EBITDA
- Interim dividend maintained at 24 cents per share, fully franked
- On-market share buy-back increased to $75 million
Solid Half-Year Results Amid Mixed Regional Conditions
GrainCorp Limited (ASX: GNC) has delivered a solid financial performance for the half-year ended 31 March 2025, reporting an underlying EBITDA of $202 million, up from $164 million in the same period last year. Underlying net profit after tax (NPAT) also rose to $69 million, compared to $57 million in 1H24. These results reflect the company’s ability to capitalise on a large east coast harvest, particularly strong volumes in Queensland and Northern New South Wales, which offset weaker conditions in Victoria and Southern New South Wales.
CEO Robert Spurway highlighted the resilience of GrainCorp’s integrated agribusiness and edible oils operations, noting that the company successfully navigated a competitive global margin environment. The agribusiness segment saw a notable increase in East Coast Australia grain production and throughput, while international operations faced margin pressures despite higher volumes, especially in Western Australia and Canada.
Stable Nutrition and Energy Segment Performance
The Nutrition and Energy division maintained steady earnings with an EBITDA of $75 million, matching the previous year’s half. GrainCorp’s processing facilities achieved a record half-year canola seed crush, driven by operational efficiencies. However, edible oil sales volumes were somewhat dampened by global market softness and drier conditions impacting supply, particularly in New Zealand. The animal nutrition business in Victoria performed well, benefiting from seasonal demand and strong margins in vegetable oils.
Capital Management and Shareholder Returns
Reflecting confidence in its financial position, GrainCorp declared a fully franked interim dividend of 24 cents per share, comprising a 14 cent ordinary dividend and a 10 cent special dividend, consistent with the prior year. The company also increased its on-market share buy-back program from $50 million to $75 million, with approximately $15 million already executed. The balance sheet remains strong with core cash of $296 million at the half-year close.
Upgraded FY25 Guidance and Market Outlook
GrainCorp upgraded its FY25 earnings guidance, now expecting underlying EBITDA between $285 million and $325 million, and underlying NPAT of $65 million to $95 million. This upgrade reflects the company’s disciplined strategy and operational agility amid ongoing global volatility. Looking ahead, the company anticipates a strong 2025-26 east coast winter crop in Queensland and Northern NSW, supported by healthy soil moisture, while conditions in Victoria and Southern NSW remain uncertain due to below-average rainfall.
Spurway emphasised GrainCorp’s strategic positioning to manage evolving global trade dynamics, with a diversified customer base and minimal exposure to the United States. The company remains focused on balancing operational efficiency, margin management, and long-term value creation for shareholders.
Bottom Line?
GrainCorp’s upgraded guidance and capital returns underscore its confidence, but seasonal and global trade uncertainties remain key watchpoints.
Questions in the middle?
- How will GrainCorp manage margin pressures in its international operations going forward?
- What impact will variable rainfall and crop conditions have on the second half and FY26 outlook?
- Could further share buy-backs or dividend changes be on the horizon amid evolving market conditions?