The Farmers Own deal with Woolworths was a 2 year contract entered into pre-2014 (ref: Page 11, Investor Presentation released to ASX: 08/02/16) and given there has been no announcement of any continuation of that contract it is assumed it has expired as CDC moved to push its own branded products into Woolworths.
Also worth noting is the contract with Aussie Farmers Direct was also only for 2 years and since there is no update it can be reasonably assumed that has also expired otherwise they would be heralding the renewal of these contracts from the roof tops.
The AHF website also states.
[EXTRACT] About CDC
CDC is an established, boutique, dairy processing business located in Camperdown, South West Victoria. It‘s plant has capacity to process 36 million litres of raw milk per annum into a full range of dairy products, and has capacity for significant production expansion.
CDC has a blue-chip customer base which includes Woolworths and Aussie Farmers Direct. It also processes Woolworth’s ‘Farmers Own’ brand of premium milk, and produces a range of dairy products under its own Camperdown Dairy Brand. CDC also has a growing export business, and is one of only a small number of Australian dairy companies with China Inspection Quarantine (CIQ) certification for the rapid clearance of fresh milk into China.
The Company has a highly experienced management team, led by Director and CEO Peter Skene and General Manager Chris Melville, which will continue to operate and manage CDC’s plan and drive the expansion of the business moving forward in conjunction with the existing dairy farming operations."
[END]
Paragraph one is a bit vague as the 36m litre processing capacity of the CDC plant is understood to only be the AHF component, the ODFC (Organic Dairy Farm) joint arrangement adds another 14m litres throughput taking the whole plant capacity to a theoretical 50m litres per annum. This was clarified by Peter Skene at the last AGM.
Paragraph two is out of date on more than just one front...Farmers Own and the China export license.
Who really knows the truth here any more, short of a contracts and accounts audit...
AHF Price at posting:
15.0¢ Sentiment: None Disclosure: Not Held
