Farmlands sets new records - latest annual result
FARMLANDS TRADING SOCIETY
Farmlands sets new records with latest annual results
FOR IMMEDIATE RELEASE
Rural retailing giant Farmlands Trading Society has recorded its best ever annual results in the company’s 45-year history.
Farmlands has declared an $82 million increase in turnover to $442 million from 1 July 2007 to 30 June 2008, 23% up on the previous year. The company has also distributed over $29 million of trading and loyalty rebates amongst its members.
Underpinning the growth, the largest since the company was founded over four decades ago, was a significant increase in the core retail business says Farmlands chairman Lachie Johnstone.
“We have recorded an impressive increase in turnover through our store network which now totals 34 stores,” says Mr Johnstone.
Farmlands was established in 1962, when a group of like-minded farmers and growers got together to secure better prices on rural supplies. Nearly half a century on that focus hasn’t changed and today the two core objectives remain: to supply shareholders with products and services at lower everyday prices and to deliver shareholder returns in the long term.
Strategic partnerships have been central to Farmlands’ ongoing success, with partner companies such as fertiliser supplier Ballance contributing to the record annual growth this year.
The acquisition of Northland Fertiliser and Stockfoods in Dargaville in October 2007 and Skeltons Horticulture in Hawke’s Bay in April 2008 has also been significant.
“Skeltons is an extremely well known and highly respected Hawke’s Bay based horticultural business which we believe will provide us with a robust platform to develop and extend our offerings to the horticultural sector,” says Mr Johnstone.
It’s not just the “business” that is experiencing growth. The number of Farmlands shareholders has also increased by 1400 in the past year to 23,000 as more people realise the benefits of becoming a shareholder.
Farmlands opens its doors to anyone wishing to take advantage of their quality range of goods, but in order to benefit from discounted shareholder prices and receive an annual loyalty rebate shoppers need to be a Farmlands shareholder. Anyone can become a shareholder by simply completing an application form and paying a one-off investment of $550.
The Farmlands Card, a company charge card that gives shareholders access to discounts at over 3,000 retailers throughout New Zealand, has also experienced record growth of $31 million (20%) over the last year.
“We believe the card is an important extension of our retail store, providing shareholders with access to thousands of suppliers offering goods and services that are not stocked in our stores,” says Mr Johnstone.
“Not only do these card purchases often attract a discount, they may also qualify the purchaser for an annual loyalty rebate payout – and this year we’ve paid out $5.8 million. The results have also given us confirmation that businesses benefit from buying through their co-operative and benefit from collective purchasing power.”
Mr Johnstone describes Farmlands as a ‘relationship business’ and says the company’s biggest asset is its staff.
“Our people understand the challenges shareholders face and are able to articulate meaningful and robust solutions. We have held a complete review of our organisational structure and as a result we have an enlarged, more focused team to provide the level of service and product knowledge we know our customers should receive.”
Additionally, a review of the Farmlands internal structure has seen two independent directors appointed to the board. Wayne Walden and Peter Wilson are working alongside other directors to ensure a high level of governance is maintained. Both bring significant business acumen to the board table.
Looking to the future, Farmlands will continue to expand its reach throughout the country with new stores in Taupo and Te Kuiti scheduled to be open for business in early 2009 explains chairman Lachie Johnstone.
“Our achievements to date ensure Farmlands can meet the objective clearly detailed in our constitution, to reduce the cost of inputs to our members through collective purchasing. What we have achieved this last year is only the beginning of an anticipated period of rapid growth.”