Investors are again fleeing listed dairy companies after shares in beleaguered Bellamy’s Australia were put in a trading halt ahead of another update on its financial performance.
The infant formula group requested the trading halt yesterday, just 10 days after its shares plunged when the company delivered a lacklustre update to investors.
In a letter to the stock exchange, Bellamy’s company secretary Brian Green requested the halt “pending the release of an updated announcement of the impact of trading conditions on (our) expected financial results”.
Investors are bracing for bad news given recent developments and the wording of the brief statement, although analysts said it was possible the update could largely be a clarification.
The group’s forecast on December 2 was widely criticised for lacking detail.
Shares in the group plunged more than 40 per cent when that trading update was released, wiping about $500 million from its market value.
Newgate Capital Partners chief investment officer, Tim Hannon said, “At the very best it could be that they have to verify the fiscal 2017 numbers because the last announcement really wasn’t that clear about what was going on’’.
“The last statement was sort of suggesting, ‘well these are our numbers, we are happy with our numbers, it has met our budget, so it’s your fault, markets that you are getting ahead of yourself’.”
A string of other dairy companies were hit yesterday in the wake of Bellamy’s move to request a trading halt.
Shares in Auckland-based A2 Milk, which is listed in Australia, closed down 6.5 per cent at $2.16.
Bega Cheese ended the day 3.6 per cent lower at $4.54, while Murray Goulburn Co-operative units closed down 2.7 per cent at 91c.