Thomas Foods hits record sales, profit on rising global beef demand

Global demand for Australian red meat and the reopening of its Murray Bridge abattoir have helped meat processor Thomas Foods International to a record year.

Darren Thomas of Thomas Foods. Picture: Tom Roschi Photography

Strong global demand for Australian red meat and improved production volumes following the reopening of its Murray Bridge abattoir have helped meat processor Thomas Foods International to a record year of sales and profit.

Financial statements lodged with the Australian Securities and Investments Commission reveal the Adelaide-based company’s after-tax profit increased to $184.5m in the year to June, up from $110.1m in the previous year.

Sales revenue was up 18.2 per cent to a record $3.29bn, on the back of a 32.3 per cent increase in sales in the US to $1.77bn.

In their directors’ report, group managing director Darren Thomas and director Nicholas Thomas said “higher production capacity, strong global demand and good livestock availability” had contributed to the “excellent results”, but said challenges were on the horizon.

“The opening of the Murray Bridge beef plant and the Bourke processing plant marked key achievements,” they wrote in their report.

“Ongoing investment in global distribution and better trading conditions in northern hemisphere business units have further enhanced sales and profit margins.

“As the financial year concluded, the company noticed a reduction in margins impacted by persistent high global inflation, slowing economic activity and reduced consumer spending.”

Domestic sales were slightly higher at $714.1m, but exports to China slipped 18.0 per cent to $251.0m, amid a slowing Chinese economy and as tariffs and trade restrictions imposed on Australian beef producers were slowly unwound.

In December Chinese authorities dropped sanctions on two Australian abattoirs, bringing to an end four years of bans and tariffs that affected more than $20bn of Australian exports.

They were the last of 10 Australian abattoirs to have direct sanctions rolled back as the frosty trade relationship between the two countries thawed.

Thomas Foods was not directly affected by the bans, and the company plans to ramp up its sales into China, which is the second biggest export market for Australian beef and veal after the US.

Last December the company signed a memorandum of understanding with a major Chinese distributor – Shanghai Paradise Garden Healthy Food Company – targeting a $60m annual sales pipeline for its red meat, pending accreditation of the company’s flagship Murray Bridge meatworks southeast of Adelaide.

After losing its previous abattoir in the town to a fire in 2018, Thomas Foods has rebuilt a state-of-the-art processing facility, which opened in May last year.

The federal government forecasts beef and veal exports to reach a record $13.9bn in 2024-2025, up 12 per cent on the previous record set in 2023-24.

The US was the largest destination market for Australian beef and veal in 2023-24, worth $3.3bn, followed by China at $2.2bn.

According to a recent Rabobank report, Australia is the only top-10 beef producing nation likely to increase production rates in 2025 due to herd contraction in the US, Brazil, China and Europe.

“We anticipate Australian beef producers will increasingly depend on exports to absorb stronger domestic production,” RaboResearch analyst Angus Gidley Baird said.

Thomas Foods is Australia’s largest family-owned meat processing company, and the largest privately-owned company in South Australia.

It has meat processing plants in NSW, Victoria and South Australia, and offices and operations across Asia, Europe and the US, trading premium lamb, beef, mutton and goat products.

The company is undertaking a $100m upgrade of its lamb production facility at Stawell, in western Victoria, following its acquisition of previous owner Frew Foods International last year, and it plans a $50m expansion of a goat abattoir in Bourke, in western NSW, which it picked up in 2021.

Family patriarch Chris Thomas, who started the business in 1988, has amassed a $1.71bn fortune, according to The Australian’s latest Richest 250 rankings.

The financial report shows the company paid $19.8m in dividends to the Thomas family, down from $20.4m in the previous year.

Thomas Foods declined to comment on its full-year results and outlook.

Originally published as Thomas Foods hits record sales, profit on rising global beef demand