Fonterra FY17 net profit drops 11 per cent
Fonterra has reported a 2017 financial year net profit after tax down 11 per cent on its 2016 results.
For the New Zealand dairy co-operative’s 2017 financial year, Fonterra made a net profit after tax of NZ $745 million.
Fonterra was however able to increase its payout to its farmers to NZ $6.52 per share.
Chairman of Fonterra, John Wilson, said Fonterra’s ability to maintain its forecast dividend despite milk price increasing by 57 per cent over the year and the impact of negative stream returns was an excellent result.
“We will always need to manage variability across our Co-operative – both in global markets and in our local farming conditions,” Wilson said.
“We’ve demonstrated our ability to deal with those conditions and deliver on our strategy again this year.
“Over recent seasons, our farmers have made significant personal sacrifices to reduce costs through a sustained low milk price period.
“As part of our continued business transformation, the Co-operative has also made a fundamental shift in the way it operates, continuing the strong focus on increased efficiency and developing new revenue streams.
“Despite lower milk volumes due to poor weather in parts of the season, the business delivered a good result by prioritising higher value Advanced Ingredients and growing our sales of these in-demand and specialised products by 473 million LME this year.”
Chief Executive Officer of Fonterra, Theo Spierings, said milk will remain at the very core of the co-operative whilst it keeps up-to-date with the demands of its customers.
“Our V3 strategy of driving more Volume into higher Value at Velocity is at the heart of our ambition, and provides the foundation for us to fund and drive innovation and sustainable value creation.
Spierings stated to remain successful Fonterra will need to be agile in every area of the co-operative.
“Our investment in innovation and advanced technologies, and an ongoing focus on creating sustainable, long-term value will become the foundation on which we continue to build strength into our Co-operative,” Spierings said.
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