Omnia

Diversified, specialist chemical services provider Omnia Holdings advised on Friday that, for the interim period ended 30 September 2009, the group expects a loss of between R95-mn and R105-mn or a loss per share of between 210c and 230c, after a profit of 839c in the prior comparative period.

The group said as indicated when it published its year-end results in June, the financial year ended March 31 2009 was an exceptional year for the group. The past financial year was characterised by unprecedented market conditions, in that it reflected neither the typical trading nor growth patterns experienced in previous years. "Commodity prices in general have substantially declined since the beginning of the year, with the group being significantly exposed to the rapid decrease in prices of nitrogen, phosphate and potash, the basic ingredients of fertilizer.

The unprecedented collapse in the price of these commodities left the group holding substantial fertilizer stocks for its farming customers valued at considerably higher prices than current market value. This has necessitated a material downward adjustment to the carrying value of the stock," the group stated in a trading update. The drop in commodity prices also had a negative effect on demand since farmers reduced their orders to the minimum while prices were declining.

The mining industry in South Africa which forms an important component of the group's customer base was also negatively impacted by the decline in commodity prices, it said. "Accordingly, shareholders are advised that, for the interim period ended 30 September 2009, the group expects a loss of between R95-mn and R105-mn or a loss per share of between 210c and 230c, after a profit of 839c in the prior comparative period," Omnia stated. It added that signs of economic recovery are visible. The financial results for the review period will be published on November 30 2009.