Duxton Farms’ $12.5M Loss Raises Questions on Dividend Sustainability
Duxton Farms reported a significant $12.5 million net loss for FY2025, reversing last year’s profit, while declaring an 85% franked dividend of 24 cents per share. The company’s revenue dipped due to property sales and increased expenses tied to a proposed acquisition.
- Net loss of $12.5 million for FY2025, down from $5.2 million profit in FY2024
- Revenue declined to $20 million, impacted by property sales and development costs
- Dividend of 24 cents per share declared, 85% franked
- Net asset value per share fell to $2.39 from $2.89
- Cotton expected to grow as a revenue driver following Kentucky property sale
A Year of Transition and Challenges
Duxton Farms Limited has revealed a sharp reversal in its financial fortunes for the year ended 30 June 2025, reporting a net loss after tax of $12.5 million compared to a $5.2 million profit the previous year. This downturn reflects a confluence of factors including reduced revenue, increased administrative costs, and strategic asset sales.
The company’s revenue fell to $20 million from $24 million in FY2024, largely due to the sale of the Timberscombe property in New South Wales and the Kentucky property, which also contributed to a loss on sale relative to prior valuations. These disposals have reshaped the company’s asset base and revenue mix, signaling a shift in operational focus.
Operational Highlights and Crop Performance
Despite the financial setbacks, Duxton Farms reported a solid harvest season. The canola crop was particularly strong, contributing about 11% of revenue with approximately 3,300 tonnes harvested. Wheat and barley yields were average, accounting for 19% and 8% of revenue respectively. Notably, cotton production is poised to become a more significant revenue contributor, with an expected 7,500 bales representing roughly 30% of group revenue. This shift follows the halving of the winter cropping program after the Kentucky sale, underscoring cotton’s growing strategic importance in New South Wales operations.
Financial Position and Dividend Policy
The company’s net asset value per share declined to $2.39 from $2.89, reflecting the impact of property sales, development expenditures, and elevated administrative expenses related to a proposed acquisition announced late June 2025. Despite the loss, Duxton Farms declared an 85% franked dividend of 24 cents per share, paid in August 2025, signaling management’s confidence in the company’s underlying value and future prospects.
Duxton Farms also reported a total comprehensive loss of $10.8 million for the year, with earnings per share turning negative at 30.28 cents compared to positive 12.47 cents last year. The company’s investments in associates, including Duxton Bees Pty Ltd, showed a loss, further weighing on results.
Looking Ahead
While the financial results highlight near-term challenges, the strategic repositioning through asset sales and the growing emphasis on cotton production could reshape Duxton Farms’ revenue profile in coming years. The proposed acquisition, which has driven increased administrative costs, remains a key development to watch for its potential to influence the company’s trajectory.
Bottom Line?
Duxton Farms faces a pivotal moment as it balances losses with strategic shifts and dividend commitments.
Questions in the middle?
- What are the details and expected impact of the proposed acquisition on Duxton Farms’ future performance?
- How will the increased focus on cotton production affect revenue stability and growth?
- Can the company sustain its dividend policy amid ongoing losses and asset sales?
