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Fonterra Salaries Concerning

12 August 2002
DFNZ: Fonterra Salaries Concerning

"Farmers may not be surprised at the level of salaries in Fonterra's annual report released today, but they will be very concerned, says Dairy Farmers of New Zealand chairman Kevin Wooding.

"This begs the question as to what level of incentives and performance bonuses are being afforded to Fonterra's senior executives, said Mr Wooding.

"Given the level of salaries, farmers will expect outstanding performance from Fonterra staff, certainly not of the standard displayed in the current milk collection fiasco.

"However, farmers should not ignore Fonterra's record turnover of $13.9 billion and total assets of $11.8 million. This is an excellent result for the first annual report since the restructuring New Zealand Dairy Board, New Zealand Milk Products and Kiwi.

"Farmers should note changes to the balance sheet including the inclusion of over $1.5 billion for the Fonterra brand. Farmers have to understand that Fonterra has borrowed against the value of the brand and this is reflected in the value of farmer's shares.

"Many farmers will not yet have received the full report and will need to spend a lot of time investigating the figures and drawing their own conclusions. Farmers will eagerly await the Fonterra Shareholders Council analysis of the annual report."

ENDS


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