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Mad Butcher owner tips profit to tumble by up to 17 per cent

Veritas Investments expects annual profit to fall as much as 17 per cent in the 2018 financial year, issuing the earnings downgrade in a notice to the stock exchange following today's annual meeting.

The food and beverage investor, which has brands including The Mad Butcher, is operating under the close watch of lender ANZ Bank New Zealand, which wants Veritas to sell assets to repay debts.

Veritas agreed to sell its Nosh business to Gosh Holding for $3.98 million in February this year but ended up in dispute with Gosh over breaches of the sale agreement. Veritas had taken on a $5m funding line from ANZ to buy Nosh in 2014 but struggled to turn it into a profitable business.

The company today said it expected net profit from continuing operations of between $3.5 million and $4m in the 12 months ending June 30, down from $4.2m in 2017. It expected to generate revenue of $26m to $29m in the 2018 year, down from $30.8m.

"As disclosed in our annual financial statements for FY17, the board is considering a number of restructuring options for the group," chair Tim Cook said in a statement.

"Accordingly, this guidance is subject to any write-offs and restructuring costs, if any, that are incurred with the implementation of these initiatives."

Veritas was granted a lifeline by its lender ANZ in November, with the bank choosing to extend the maturity on $28.5m of debt, giving the food investor space to complete any potential asset sale.

Director Sharon Hunter retired by rotation at today's annual meeting in Auckland, and did not seek re-election. Shareholders approved the firm's sole resolution authorising the board to fix the fees and expenses of PwC as Veritas's auditor.

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