Great Southern posts $64 million loss

A 24 per cent fall in sales of managed investment schemes (MIS) to $314 million contributed to an after tax loss of $63.8 million posted by Great Southern Limited for the financial year ending September 30.

Managing director Cameron Rhodes attributed the “disappointing set of numbers” partly to “uncertainties in the MIS sector created by Government and the Australian Taxation Office”.

Another factor was “deteriorating economic conditions on bad debts and provisioning in the MIS sales peak late last financial year when sales are at their peak”, Rhodes said.

“This underlines the fact that Great Southern needs to reduce its reliance on MIS sales to generate the revenues required to service higher operating cost and higher gearing the business currently carries.”

Great Southern is “exploring a range of alternative options to meet its future funding needs ... and a key part of this will be the sale of assets”, he said.

Profits before tax and asset write-downs fell to $19.2 million, and net operating cash inflows by 57.3 per cent to $86.9 million.

Gearing levels increased to 53 per cent from 46 per cent, as measured by the ratio of debt to debt plus equity, as a result of a reduction to net assets.

The overall balance sheet “has remained relatively robust”, Rhodes said, with net assets of $706 million on total assets of $1,790 million.