January 29, 2020 / 3:40 AM / a month ago

Australia's Kangaroo Island Plantation suspends shares, says most trees not productive after fires

(Reuters) - Australia’s Kangaroo Island Plantation Timbers Ltd (KPT.AX) on Wednesday suspended trading in its shares, saying an estimated 90% of its trees are no longer productive due to the bushfires that have ravaged the country for months now.

Bushfires in Australia have killed 33 people and about 1 billion animals since September, while some 2,500 homes and an area the size of Greece have been destroyed.

Providing a preliminary assessment of the severity of damage, the company said that only 5% of its tree crop has not been fire-affected, while a further 5% has experienced predominantly ground fire causing minor canopy damage.

“The remaining 90% has suffered significant canopy fire,which was severe in 35% of the estate and complete to the point of total defoliation in 55% of the estate,” the company said in a statement.

The Adelaide-headquartered company did not give details about the potential financial impact of the fires, or whether any of the timber from the severely fire-damaged trees could be salvaged.

Eucalyptus globulus is the main species grown by the company on Kangaroo Island, a popular holiday spot in South Australia where agriculture and tourism are the major industries.

The company’s shares have slipped more than 11% in the December quarter and have declined about 13% so far this year.

Reporting by Aby Jose Koilparambil in Bengaluru; Editing by Tom Hogue

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