Livestock operator Australian Agricultural Company is stuck between drought and flood, the listed farm services provider bracing for 'extreme' losses at its 30,000-head Gulf property Wondoola station while counting the cost of continued dry weather elsewhere.
Shares in the company were down by more than 5.5 per cent in early trade on Monday after it announced it expected heavy losses across its four flood-affected northern Queensland properties, with an assessment yet to be completed amid the possibility of further wet season storms.
Of AACo's northern properties, Canobie, Dalgonally and Carrum stations have a total current herd of approximately 50,000 head of mainly cows and their calves, and are expected to sustain lower losses than Wondoola, where livestock losses are expected to be severe.
Read Next AACo management they were monitoring the situation closely and would take all possible steps to mitigate the impact on operations.
"Our immediate focus is on our people, the welfare of our animals and the tight knit communities in which we operate," it said in a release to the ASX.
"The full effects of the flood are being managed and measured in real time."
More than 500,000 head of cattle are predicted to have been lost after a year's worth of rain fell in two weeks across the region.
Early estimates put the damage to the northern Queensland farm sector in excess of $300 million.
Despite the losses, AAco said it would still be able to fulfil its supply obligations and the rollout of its branded beef strategy.
"While we are still assessing the impact of this tragic situation, our balance sheet and financial position remains strong," the company said.
Conversely, drought continues to sap the larger share the company's properties, which are situated across south-western Queensland and the Northern Territory.
The company flagged in its half-year results in November the seasonal conditions would significantly increase station operating expenses, particularly grain, feeding and transport costs.
Shares in AACo were trading 5.66 per cent lower at $1.00 at 1125 AEDT, down from $1.125 a week ago and 38 cents lower than the 18-month peak of $1.44 in July.