Food company to sell number Australia’s number 2 canned salmon brand as it is being investigated by authorities for a series of “significant” accounting problems.
Listed food company Freedom Foods has been caught in the midst of an accounting scandal, where it said that its earnings would be hurt by AUD 590 million (EUR 360 million) in write-downs.
Its past financial results were inaccurate, ABC reports, and, despite saying that earned a full-year profit of CAD 11.6 million (EUR 7 million), the figure was actually a CAD 145.8 million (EUR 89 million) loss.
The dairy and breakfast foods business is now being investigated by the corporate regulator ASIC because of a “litany of accounting oversights and complex cash flow arrangements”.
The publication Farm Weekly reports that the company, which last traded on the Australian Stock Exchange five months ago, is reportedly offloading its seafood business. Part of that is Paramount, which is the number 2 proprietary brand in canned salmon (Atlantic and Pacific) in Australia, acquired in 2003. Paramount is a strategic partner with North America’s largest canned seafood company Bumble Bee Seafoods.
The business news site Financial Review reported that seafood operations could carry a price tag of between AUD 10 million to AUD 20 million.
Freedom Foods recruited dairy farmer Michael Perich as temporary CEO, as its former boss Rory Macleod was “on leave pending a further announcement” in June, and exited the company in July for good.