The $2.1m after tax loss compares to a net profit after tax of $5.9m in corresponding period last year.

But the AACo announced today that it had posted a positive operating cash flow of $5.9m for the six months ending 30 June 2008, compared to the previous corresponding period's negative flow of $20m.

The country's biggest publicly listed cattle company's earnings before interest and tax also increased by 28pc to $16m after adjusting for the AMP settlement ($8.8m net) included in last year's half year result.

The company also announced today the appointment of Stephen Toms, formerly the company’s chief financial officer, to the position of chief executive officer.

Mr Toms said the interim result "demonstrates that AAco understands how to control debt and we are on track to deliver positive cash flow in the second half of the year".

He said the positive cash flow in the last six months was primarily due to the sale of a significant number of breeding cattle held over from the previous corresponding period.

Mr Toms said that in comparing the current half-year results to the corresponding period, it should be noted last year the profit and cash flow included the benefit of a net $8.8m settlement from AMP regarding litigation related to the 2003 Stanbroke acquisition process.

Mr Toms said that amongst the company's key operational drivers was the sale of more than 121,000 cattle, releasing $76.7m in cash.

He also said that property values in northern Australia continued to rise and rainfall patterns returned to normal, with the exception of the Northern Territory’s Barkly Tablelands.

"Our response to the Barkly climatic conditions is a prime example of the strength of AAco," he said.

"Our geographic spread and our strategic planning ensured that we were ready and able to move cattle to safer pastures.

"AAco's management had the depth and breadth of skills to successfully move a considerable amount of cattle to the north, east and south.

"It's important to note that we are positioning the business to take full advantage of what we anticipate will be a rapid increase in cattle prices in the remainder of the year."

Mr Toms noted that prices have rallied from $3.15 to $3.40 a kilo in the first half of this year to $3.53/kg a in recent weeks.

On the downside though, the strong Australian dollar has impacted export prices, while returns have also been hit by high fuel and grain prices.

The AACo board has declared a dividend of seven cents per share, payable in mid October 2008.