elders (ASX:ELD) announced its financial results for the year ended September 30, 2024. The company reported a difficult year, particularly in the first quarter, marked by volatile market conditions and weak customer sentiment.

The company is a leading agribusiness serving regional and regional Australia, providing agricultural products, services and advice.

Sales decreased 6% to $3.13 billion, and underlying profit before interest and taxes decreased 25% to $128 million. After-tax net income to shareholders decreased 55% to $45.1 million. These results reflect the impact of lower livestock prices and reduced demand for agrochemical products earlier in the year, but were somewhat mitigated by a recovery in livestock markets and improved trading conditions in the second half of the year. Expenses for acquisitions and growth initiatives increased costs by 14% to $509.6 million, further compressing margins.

The company emphasized its focus on diversification, which has enabled it to partially offset regional and product-specific challenges. Notable achievements include the launch of Elders Wool, a state-of-the-art wool processing facility, and the expansion of our geographic footprint with 13 acquisitions and 21 additional locations. Despite these efforts, return on equity was 11.3%, down from 16% a year ago.

The board announced a final dividend of 18 cents per share, bringing the total annual dividend to 36 cents, up from 46 cents in 2023. This reflects an 88% increase in the dividend payout ratio due to a decline in the earnings base.

On the sustainability front, Elders reported on progress towards emissions reduction targets, including renewable energy projects and electric vehicle trials.

The company also highlighted pressure from increased debt levels, with net debt increasing 49% to $690.5 million, partly due to acquisitions and investments in transformation projects.

Looking ahead, Elders expects market conditions and customer sentiment to improve in FY25, supported by improved seasonal conditions and a recovery in livestock prices. However, we recognize continued cost pressures and the need for operational efficiency.

Mark Allison, Managing Director and CEO, said: We are focused on maintaining a strong foundation for future growth. ”