Elders Limited

Elders Limited, formerly known as Elder, Stirling & Co., Elder Smith and Co. and Elder Smith & Co. Ltd, is an Australian agribusiness that provides agricultural goods and services to primary producers in Australia and New Zealand.[2]

Elders Limited
TypePublic
ASX: ELD
IndustryAgribusiness
Founded1839 (1839) in Adelaide, South Australia, Australia
FounderAlexander Lang Elder[1]
Headquarters
Adelaide
,
Australia
Area served
Australia, New Zealand, China
Key people
Mark Allison CEO, Managing Director, (since May 2014).
Ian Wilton Chair (Since September 2019),
Michael Carroll, Non-Executive Director (since September 2018)
Robyn Clubb, Non-Executive Director (since September 2015)
Diana Eilert, Non-Executive Director (since November 2017)
ProductsLivestock, Farm Supplies, Wool, Grain
ServicesReal estate, agronomists, production advice, insurance, international trading
Number of employees
2000+
Websiteelders.com.au

History

Early history (1839 - 1939)

With the fledgling colony of South Australia only three years old, Alexander Lang Elder[1] arrived in Port Misery (now Port Adelaide) in January 1839 aboard the family-owned schooner Minerva as the only cabin passenger, under Captain David Reid.[3] He went there to set up business and explore opportunities for his family's Scottish-based merchant and shipping business. Alexander's brothers, William,[4] George,[5] and Thomas[6] joined Alexander, although of the four, only Thomas stayed in Australia. Thomas moved to Adelaide in 1854 and worked with George for a year.

After George left, Thomas formed Elder, Stirling & Co with Edward Stirling,[7] Robert Barr Smith,[8] and John Taylor.[9] On Stirling and Taylor's retirement in 1863, Barr Smith and Thomas Elder formed Elder Smith and Co.

In 1888 Elder Smith and Co. was amalgamated with its subsidiary Elder's Wool & Produce Co. Ltd, and Peter Waite became the chairman of directors of the new company, which was called Elder Smith & Co. Ltd.[10] Now in his eighties, Barr Smith launched Elders Trustee and Executor Limited and formed Elders Metal and Mercantile in Melbourne. Elders profits more than doubled from 1918 to 1928, with Peter Waite as chairman until his death in 1922, followed by Tom Elder Barr Smith, son of Robert.[10]

In 1929 Walter Bagot, of Woods, Bagot, Jory & Laybourne Smith designed the Elders Currie Street.[11][12]

World War II and after (1939 - 1962)

The Elders centenary in 1939 coincided with the start of World War II when the highly competitive wool-selling business was put into government control. As the war continued, the wool auction system remained closed and the British government acquired the total Australian wool clip. In 1941, the British government paid Elders today's equivalent of more than $3 billion, and nearly $4 billion the following year. The return to the open auction system in 1946 saw the start of a dramatic five-year run for wool.[13] National wool revenues increased 29% and 64% respectively in the first two full years of peace.

In the early 1950s, Norman Giles moved from the Elders WA branch of the company to the Adelaide branch, and two years later became Managing Director.[14] In 1962 Giles announced the merger of Elder Smith and Goldsbrough Mort with its new corporate headquarters located in Adelaide. In 1970, Giles expanded Elders into Gove Alumina and Robe River mining ventures and launched Elders Finance and Investment Co. Sir Norman Giles retired in 1975 after 54 years with Elders.

Structural changes and expansion beyond agriculture (1970 - 2009)

In 1982 Elders merged with jam maker Henry Jones IXL to become Elders IXL.[13] The following year, Elders launched a successful takeover bid for Carlton and United Breweries, which it renamed to Elders Brewing Group.[14] In 1989, due to an economic downturn, Elders sold Henry Jones IXL to The J.M. Smucker Co., was renamed Elders Pastoral, and became a division of its subsidiary Foster's. In 1993, after being renamed Elders Limited, Elders was floated from Foster's, after which it acquired the Australian Agricultural Company. Two years later, Futuris Corporation, a major shareholder in Elders, became the new owner of Elders Limited.[13]

In 1997, Elders launched Australian Wool Handlers as a joint venture, a wool handling and dumping company that quickly became responsible for more than 60% of the national clip. In 1999 Elders Finance was sold to New Zealand-based company Hanover Finance after Elders had sold this business to NZ based investors who took on $20 million of liabilities.[15] In 2009, Futuris Corporation changed its name to Elders Limited, and changed from its conglomerate holding company structure to a single integrated company with an owner-operated focus around its principal business Elders.[13]

In 2013 Elders returned to a pure play agribusiness by selling and divesting the last portions of its Forestry and Automotive divisions.

Return to pure play agribusiness (2013 - 2019)

In May 2014, Mark Allison was appointed CEO.[16]

Central to Allison's restructure of Elders was an Eight Point Plan, which outlined an aspirational target of returning Elders to sustainable earnings growth by FY17.

In 2016, Elders acquired 20% of Elders Insurance from QBE and 30% of StockCo.[17]

In 2017, Elders divested its live export division, North Australian Cattle Company (NACC) and Indonesian Feedlot and Abattoir,[18] re-allocating capital to a number of new acquisitions including horticultural inputs and services provider Ace Ohlsson and Kerr & Co Livestock.[19] 2017 also saw Elders complete the buyback of preferential hybrid shares.[20]

In December 2017 Elders paid its first dividend to shareholders in nine years and achieved a market capitalisation of $850 million, referred to as “one of the biggest turnarounds in Australia’s corporate history".[21]

In May 2018, Elders acquired Titan Ag, a manufacturer and supplier of agricultural chemicals.[22] Elders began its acquisition of direct competitor Australian Independent Rural Retailers (AAIR) in July 2019 after making an AUD187 million offer.[23]

Main operations

Rural products

Elders is a significant supplier of farm inputs to primary producers in Australia. Products include seeds, fertiliser, agricultural chemicals, animal health products and general rural merchandise. The company also supplies professional and technical services to the rural sector via a network of agronomists.[24]

Agency services

Elders provides a range of services to assist primary producers with the sale of wool, grain and livestock. The company's network of livestock agents and employees operates across Australia, with operations including livestock auctions (both physical and online), and direct sales to feedlots and livestock exporters.

Elders has historically been one of Australia's largest agents for the sale of greasy wool. The company also operates a brokering service for woolgrowers and a grain marketing business.[24]

Real estate services

Elders provides real estate services from around 300 branches across Australia.[25] Rural agency services are primarily involved in the marketing and sale of farms, stations and lifestyle estates. Residential real estate services, including agency and property management, operate in major population centres and regional areas through a network of company-owned and franchised offices. Elders is also involved in mortgage and water broking.[24]

Financial services

Elders offers a range of banking and insurance services from branches across Australia.[24]

Feed and processing services

Elders operates the Killara feedlot located south of Tamworth in New South Wales.[26] The company also imports, processes and distributes premium Australian meat in China.[24]

Australian Independent Rural Retailers (AIRR)

In July 2019, Elders announced the acquisition of AIRR, an unlisted public company, for $187 million.[23] AIRR was established in 2006 as an independent buying and marketing group for rural merchandise and pet and produce stores. The business has around 240 independent member stores plus 100 Tuckers Pet & Produce stores across Australia. The acquisition was finalised on 13 November 2019.

Financial results

Financial year ending 30 September 2019

On 11 November 2019, Elders Limited released its full-year results to the Australian Securities Exchange.

Underlying after-tax profit of $63.6 million was reported, in line with the previous financial year. Earnings Before Interest and Tax (EBIT) fell marginally to $73.7 million.[27] The company declared a final, fully-franked dividend of 9 cents per share, taking the full-year dividend to 18 cents fully franked.

The result was against a backdrop of drought affecting much of Australia, with the strong financial performance attributed to Elders' diversification across different regions and multiple products and channels.[28]

Social responsibility

In 2016 Elders partnered with the North Queensland Cowboys National Rugby League team, producing a series of television advertisements and community initiatives to raise awareness and break the stigma of mental health. This program ended in 2018.[29]

Following the Sir Ivan bushfire in June 2017 which burned more than 55 000 hectares of western NSW farmland in a single day,[30] many Elders teams gave up time to contribute to a fencing day restoring damaged property. The project was conducted in collaboration with longstanding client Ant Martin of Dalkeith Herefords, whose properties were hit particularly hard by the bushfire.[31] Elders also raised funds for the NSW Farmers Merriwa Sir Ivan Bushfire Appeal.[32]

Elders Give It is a community giving program raising funds for not-for-profit organisations that support rural communities. Current partners of Elders Give It include the Royal Flying Doctor Service, Landcare Australia and Beyond Blue.[33]

In April 2017 Elders on South Australia's Eyre Peninsula raised $25,000 for the Royal Flying Doctor Service and in November of the same year became a major sponsor of the Flying Doctor unveiling a new aircraft bearing the Elders logo,[34] part of a three-year $300,000 sponsorship.[35]

In March 2018 in Queensland, Elders Clermont raised more than $20,000 for Beyond Blue at a charity gala.[36]

In FY2019, Elders made donations, support and contributions valued at $1.3 million to community projects including sporting teams, schools and rural charities.[24]

Awards

National Safety Council of Australia - Judges’ Choice Award for Excellence in Workplace Health and Safety 2015[37]

Turnaround Management Association – Large Business Turnaround of the Year 2015[37]

Elders Insurance - Canstar - Outstanding Value (Landlord Insurance) 2017[38]

Korn Ferry Employee Engagement Awards – Outstanding Employer 2017[39] and 2019[40]

Governance Risk and Compliance Institute – Team of the Year (Elders Financial Planning) 2018[41]

Elders Real Estate - Canstar Blue – Most Satisfied Customers 2019[42]

References
  1. Fayette Gosse, 'Elder, Alexander Lang (1815–1885)' Archived 21 February 2010 at the Wayback Machine, Australian Dictionary of Biography, Volume 4, Melbourne University Press, 1972, pp 133-134. Retrieved on 11 July 2009.
  2. "Elders Limited". Elders Limited. Retrieved 29 November 2019.
  3. "Overseas Arrivals to South Australia - early 1840". localwiki. Adelaide Hills. Retrieved 24 July 2019.
  4. Fayette Gosse, 'Elder, William (1813–1882)' Archived 31 July 2008 at the Wayback Machine, Australian Dictionary of Biography, Volume 4, Melbourne University Press, 1972, pp 133-134. Retrieved on 11 July 2009.
  5. Fayette Gosse, 'Elder, George (1816–1897)' Archived 31 July 2008 at the Wayback Machine, Australian Dictionary of Biography, Volume 4, Melbourne University Press, 1972, pp 133-134. Retrieved on 11 July 2009.
  6. Fayette Gosse, 'Elder, Sir Thomas (1818–1897)' Archived 19 April 2009 at the Wayback Machine, Australian Dictionary of Biography, Volume 4, Melbourne University Press, 1972, pp 133-134. Retrieved on 11 July 2009.
  7. Hans Mincham, 'Stirling, Edward (1804–1873)' Archived 19 June 2007 at the Wayback Machine, Australian Dictionary of Biography, Volume 6, Melbourne University Press, 1976, pp 200-201.
  8. Dirk van Dissel, 'Smith, Robert Barr (1824–1915)' Archived 19 April 2009 at the Wayback Machine, Australian Dictionary of Biography, Volume 6, Melbourne University Press, 1976, pp 153-154.
  9. "THE LATE MR. JOHN TAYLOR". South Australian Register. XXIX (5793). South Australia. 26 May 1865. p. 4. Retrieved 9 March 2016 – via National Library of Australia.
  10. Findlay, Marjorie (1976). "Waite, Peter (1834–1922)". Australian Dictionary of Biography. 6. Melbourne University Press. ISSN 1833-7538. Retrieved 14 February 2010 – via National Centre of Biography, Australian National University.
  11. "Architect Details: Bagot, Walter Hervey". Architects of South Australia. University of South Australia. Retrieved 17 January 2021.
  12. "Building Details: Elder Smith and Co. Ltd". Architects of South Australia. Retrieved 18 January 2021.
  13. "Elders Historic Summary" (PDF). Elders Limited. Retrieved 29 November 2019.
  14. "Elders Historic Summary" (PDF). elders.com.au. Retrieved 29 November 2019.
  15. "Bitter feud precedes Elders settlement". sharechat.co.nz. 16 July 2004. Archived from the original on 31 January 2016.
  16. "Investor centre". Elders Limited. Retrieved 29 November 2019.
  17. "Elders to acquire StockCo equity" (PDF). ASX. Retrieved 29 November 2019.
  18. "Elders quits live export business". Australian Financial Review. 12 September 2016. Retrieved 3 December 2019.
  19. "Completion of key milestones" (PDF). ASX. 1 June 2017. Retrieved 3 December 2019.
  20. "Final removal of expired class from quotation - ELDPA" (PDF). ASX. 13 July 2017. Retrieved 3 December 2019.
  21. "Elders rebuild delivers an $850m company". Australian financial Review. 14 December 2019.
  22. "Elders completes acquisition of Titan Ag Pty Ltd and Kerr & Co Livestock" (PDF). ASX. 2 May 2018. Retrieved 3 December 2019.
  23. "Acquisition of AIRR and Equity Raising" (PDF). 15 July 2019. Retrieved 29 November 2019.
  24. "2019 Elders Annual Report" (PDF). 11 November 2019. Retrieved 29 November 2019.
  25. "Home of Australia's most satisfied customers". Elders Real Estate. Retrieved 29 November 2019.
  26. "Elders Killara Feedlot is a supplier of high-grade, grain fed cattle". Elders Rural. Retrieved 29 November 2019.
  27. "Elders Limited FY2019 Results" (PDF).
  28. "Good returns in bad seasons - Elders defies drought with 'solid' profit". Sydney Morning Herald. 11 November 2019. Retrieved 3 December 2019.
  29. "Elders and Cowboys announce mental health partnership". Elders Rural. 3 August 2016. Retrieved 18 November 2019.
  30. "Sir Ivan Fire, 2017". Australian Institute for Disaster Resilience. Retrieved 18 November 2019.
  31. "Elders team extend helping hand to those affected by Sir Ivan bushfire". Elders Rural. 29 June 2017. Retrieved 18 November 2019.
  32. "Elders joins Sir Ivan bushfire appeal". The Land. 20 March 2017. Retrieved 18 November 2019.
  33. "Give It". Elders Rural. Retrieved 18 November 2019.
  34. "Elders partnership takes off". Royal Flying Doctor Service. 24 November 2017. Retrieved 18 November 2019.
  35. "RFDS takes flight with Elders $300,000 donation". Fundraising & philanthropy. 12 December 2019. Retrieved 18 November 2019.
  36. "Elders Clermont give back for mental health". Elders Rural. 1 March 2018. Retrieved 18 November 2019.
  37. "Elders wins prestigious awards". Elders Rural. 15 October 2015. Retrieved 4 December 2019.
  38. "Elders Insurance landlord insurance recognised for outstanding value". Elders Rural. 27 July 2017. Retrieved 4 December 2019.
  39. "Elders shows how employee engagement is good for business". Korn Ferry. Retrieved 4 December 2019.
  40. "Four Australian companies are honoured with the 2019 Korn Ferry engaged performance awards". Korn Ferry. Retrieved 4 December 2019.
  41. "GRCI annual awards". GRC Institute. Retrieved 4 December 2019.
  42. "Real estate agents compared". Canstar Blue. Retrieved 4 December 2019.
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