Goodman Fielder Limited
(ASX:GFF) says it expects annual earnings will drop to the lower end of its forecast and warned it will book about $200 million of write-offs in the 2012 financial year.
Delivering an update on trading conditions, carrying values and divestments this morning the breads and spreads producer forecast normalised earnings before interest and tax and significant items at the lower end of its $230 million to $245 million range.
Goodman Fielder also advised trading conditions and external markets remain very challenging.
The company has been particularly impacted by increased competitive pressure, including price reductions for supermarket private label bread and the resulting pricing pressure on proprietary branded bread.
Higher labour and logistics costs have also been blamed for earnings pressure in its Australia and New Zealand baking division.
In the first half of the 2012 financial year Goodman Fielder posted a net profit of $21.5 million.
