Australian Agricultural Company Ltd
(ASX:AAC) plans to shift its focus from beef production to cattle trading following the recent appointment of CEO David Farley.
The company is due to release the details of its strategic review today, which are expected to reveal the dramatic plan that Mr Farley hopes will help it return to profit by the end of the calendar year.
The company plans to focus on three areas to generate revenue growth: live beef exports to Southeast Asia, boxed-meat sales to the US and the supply of value-added meat products to restaurants and supermarkets.
It plans to begin exporting live cattle in the fourth quarter of this financial year.
Underpinning the expansion will be a new breeder-alliance program allowing the company to outsource cattle breeding to third-party pastoralists.
The proposed shift to cattle exporting is designed to boost sustainable earnings growth and ensure the business is less exposed to severe weather conditions and currency risks that contributed to last year’s poor result.
Australian Agricultural Company reported a loss of $53.74 million for calendar 2009.
