While the half-year profit is a big turnaround from the corresponding period last year when it posted a $6.5m loss, the profit figure is below its guidance last week of between $37m and $42m.

GrainCorp managing director Mark Irwin put the result down to a seasonal turnaround from the past two drought-affected financial years.

"Improved seasonal conditions in Queensland and northern NSW through 2008, and into early 2009, boosted our grain receivals and allowed the grain export sector to bounce back," Mr Irwin said.

"Our profit result is also good news for growers. Our tonnage and export numbers are up which means growers are harvesting and marketing grain.

"The last winter and summer crop harvests were a welcome return to production and profitability for many growers. GrainCorp is sharing in that good fortune."

Mr Irwin also attributed the result to significant changes to the structure and operations of the company implemented over the past two years.

"We have focused closely on reducing costs and increasing efficiency," he said.

"The hard work and sacrifice is clearly starting to pay off for the Company, and shareholders will benefit in the medium to long term."

Despite the result, GrainCorp chairman Don Taylor said the company has elected not to pay an interim dividend.

"The payment of a full year dividend will be considered by the board at the end of the financial year (after 30 September), taking into account the full FY09 performance and FY10 prospects," Mr Taylor said.

Capital raising

GrainCorp also took the opportunity of this morning's good news to announce a $60m capital raising project, which will involve a share placement and share purchase plan.

The company says the plan is aimed at improving the strength of its balance sheet and positioning GrainCorp for growth and income diversification opportunities.

The placement involves the issue of up to 9.65 million GrainCorp shares with existing and new shareholders, while the share purchase plan (SPP) will enable current GrainCorp shareholders to subscribe for up to $15,000 worth of GrainCorp shares (subject to ASIC relief/ASX waiver).

Mr Irwin said the company needs to strengthen the balance sheet as it recovers from the drought.

"The equity raising will increase our financial flexibility and will reduce the gearing of the company," he said.