The Chairman of AWB Limited, Mr Brendan Stewart, today announced an after-tax profit of $43.9 million for the year ended 30 September 2003.

The Board has declared a fully franked final 2002/03 dividend of 11 cents per share, to be distributed to shareholders on 19 December 2003 for shareholders registered as at 5 December 2003.

“When added to the interim dividend of 14 cents per share the total dividend paid to shareholders for the year is 25 cents.   This reflects the Board’s policy to maintain a stable dividend payment subject to future conditions and financial performance,” said Mr Stewart.

AWB has implemented a Dividend Reinvestment Plan effective from the final 2003 Dividend.

AWB Limited’s Managing Director, Mr Andrew Lindberg, said the full year profit result was a good result given Australia had experienced one of its most severe droughts during the reporting period.

“Whilst the major drivers of the business fell significantly (export volumes fell by over 75%) the fall in earnings of only 59% reflects the improvement in the underlying performance of the business,” said Mr Lindberg.

“The drought resulted in significantly lower grain production from the 2002/03 harvest, with wheat production of approximately 9.7 million tonnes, a reduction of 61% from the 2001/02 harvest of 24.9 million tonnes,” said Mr Lindberg.

AWB’s earnings per share of 15.9 cents is 59% lower than the prior corresponding period (pcp).

The full year profit result excludes profit on the sale of Ceres House of $3.5 million which was previously included in our 2002/03 forecast.  The sale profit is now included in our forecast for year ending 30 September 2004.

The major profit contributions for the 2002/03 full year results were from Finance and Risk Management, Grain Acquisition and Trading and Pool Management Services areas. 

“It has been a challenging year for AWB, the company has delivered on its strategy of growth and diversification with the acquisition of Landmark.  One month of earnings contribution from Landmark is included in the full year profit result,” said Mr Lindberg.

“AWB Limited has continued to mature and we are now well positioned to deliver even more value to Australian farmers, customers and shareholders,” said Mr Lindberg.

The outlook for AWB is positive with the Board upgrading its forecast net profit after tax to $110-$120 million for the year ending 30 September 2004 (pre goodwill amortisation including all one-off costs).  Amortisation of the goodwill on acquisition of Landmark is forecast to be $29.3 million. 

AWB reconfirms its forecast for domestic wheat production in the range of 22-24 million tonnes for the 2003/04 season.

This upgraded forecast reflects an improved outlook for earnings and highlights the additional benefits achievable from the integration of Landmark.  AWB has implemented a comprehensive integration plan which is progressing well with the roll out of cross selling opportunities to the network, back office consolidation and targeted growth in financial services. 

“We are on track to reach our upgraded forecast range and the Board is confident that the ongoing focus on maximising AWB National Pool returns and the financial performance of the company will continue to deliver solid returns to AWB’s shareholders, the vast majority of whom are Australian wheat growers,” said Mr Lindberg

Operational summary for 2002/03

• Successful strategic acquisition of Landmark.
• Achieved $329 million extra value for 2001/02 AWB National Pool, over and above the Wheat Industry Benchmark.
• Sold and shipped 400,000 tonnes of wheat to Iraq despite logistical challenges, and secured funding for the outstanding 800,000 tonnes of Iraqi contracts.
• Successfully implemented an innovative “ring fencing” structure, protecting AWB National Pool from the commercial activities of AWB, and delivering the highest short-term credit rating available for AWB Harvest Finance Limited.
• AWB maintained market leadership in wheat harvest finance in the face of increased competition
• 12% reduction in total overheads (excluding depreciation)
• Established new grain logistics subsidiary, AWB GrainFlow, which opened nine new greenfield sites for 2002/03 harvest and constructed four new sites for 2003/04 harvest.

For further detail on AWB Limited’s profit results click on Investor Relations section and look under financial results.