Inghams shares tumble after Omicron goes into chicken production

By Stuart Condie

SYDNEY – The shares of Inghams Group Ltd. fell sharply on Tuesday after Australia’s largest chicken producer warned its production and distribution had been affected by the number of employees with the Covid-19 Omicron variant.

The stock fell 8.5% in morning trading to AU $ 3.23 after Inghams said it could not estimate the overall impact of the disruption on its financial performance.

Inghams supplies Australia’s major supermarkets and fast food outlets, including KFC, McDonald’s and Subway franchises. It said its main locations remained operational but the number of available employees was significantly lower than normal, with many employees forced to self-isolate at home in accordance with rules aimed at slowing the spread of the virus.

“It disrupted production and distribution capacity and impacted sales,” Inghams said in a statement to the Australian Securities Exchange.

Inghams customer Woolworths Group Ltd., which operates Australia’s largest supermarket chain, wrote to customers last week apologizing for the empty shelves amid the disruption caused by Covid. Coles Group Ltd., another supermarket chain offering Inghams products, has limited the amount of chicken and certain other meat products that customers can purchase at a time.

Inghams chief executive Andrew Reeves said planned changes to isolation rules should help Inghams alleviate staff shortages, which were creating “significant operational inefficiency”.

“As operating conditions begin to stabilize, we expect our production capacity to recover relatively quickly to meet customer and consumer demand,” said Mr. Reeves.

Shares were down 7.5% for the last time to A $ 3.265.

Write to Stuart Condie at [email protected]

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