Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Synlait hikes annual profit forecast on value-add earnings

Synlait hikes annual profit forecast on value-add earnings growth, unsure on Chinese sales target

By Paul McBeth

Jan. 28 (BusinessDesk) - Synlait Milk, the milk processor which counts China’s Bright Dairy Food as a cornerstone shareholder, will beat its annual profit forecast by as much as 77 percent on earnings growth, though might miss its sales target for infant formula into China due to stricter regulations.

The Rangiora-based company anticipates net profit of between $30 million and $35 million in the year ending July 31, up from the $19.67 million forecast in the company’s prospectus when it listed in July, it said in a statement.

Synlait lifted its forecast milk payout to between $8.30 per kilogram of milk solids and $8.40/kgMS from $8/kgMS previously as global dairy prices climbed, but is reaping earnings growth from its value-add products and a favourable product mix, chairman Graeme Milne said.

Chief executive John Penno warned the company might fall short of its forecast target of selling 10,000 metric tonnes of infant formula and nutritional products into China due to stricter regulations, which have caused “considerable disruption to the Chinese market.”

“However, we remain confident that these changes will validate the strategy of our business over time and will underpin our ability to meet our long-term targets through expected volume growth from our key customers in this market,” Penno said.

In December, Synlait Milk said it expected to see faster growth in 2014, with international demand favouring the company’s milk powder and anhydrous milk fat products.

Penno said the company expects to start production of milk powders for infant formula for two tier one multi-national companies in the second half of the year, without naming them. Commercial production at its lactoferrin plant is likely to begin commercial production in early March, and is expected to exceed its forecast two metric tonnes of lactoferrin sales in the financial year.

The shares fell 1.3 percent to $3.95 yesterday, and are almost 80 percent higher than the $2.20 offer price.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Interest Rates: RBNZ Hikes OCR To 3.5%, ‘Period Of Assessment’ Now Needed

Reserve Bank governor Graeme Wheeler raised the official cash rate as expected, while signalling a pause in rate hikes to assess the impact of moves so far this year. The kiwi dollar sank after Wheeler said its strength was “unjustified” and that the currency could have “a significant fall.” More>>

ALSO:

Fonterra: Canpac Site 'Resize' To Focus More On Paediatrics

Fonterra is looking at realigning its packing operations at Canpac, in the Waikato, to focus more on paediatric nutritionals... The proposed changes could mean around 110 roles may not be required at the site which currently employs 330. More>>

ALSO:

Scoop Business: Postie Plus Brand Gets 2nd Chance With Well-Funded Pepkor

The Postie Plus brand is getting a new lease of life after South Africa’s Pepkor bought the failed retailer’s assets out of administration and said it will use its purchasing power to reduce costs of stock and fatten margins. More>>

ALSO:

Warming: Warming Signs From State Of Climate Report

Climate data from air, land, sea and ice in 2013 'reflect trends of a warming planet' -- says the latest State of the Climate report, launched by U.S. and New Zealand scientists. More>>

ALSO:

Scoop Business: Embrace Falling Home Affordability, Says NZIER

Despair over the inability to afford a house is misplaced and should be embraced as an opportunity to invest in more wealth-creating activity, says the principal economist at the New Zealand Institute of Economic Research, Shamubeel Eaqub. More>>

Productivity Commission: NZ Regulation Not Keeping Pace

New Zealand regulators often have to work with out-of-date legislation, quality checks are under strain, and regulatory workers need better training and development. More>>

ALSO:

Callaghan Innovation: Investment To Help Deepen Innovation Reporting

Callaghan Innovation, the government’s high tech HQ for Kiwi business, is to help deepen New Zealand media coverage of the commercialisation of innovation through an arms-length partnership with independent business news service BusinessDesk. More>>

ALSO:

Tax Credits, Grants: Greens $1Bn R&D Plan

In the Party’s headline economic announcement, the Greens have launched their plan to build a smarter, more innovative economy which has as its centrepiece an additional $1 billion of government investment in research and development (R&D) above current spend, including tax breaks for business. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news