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.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Welcome Home: Record High Migration Stokes 41-Year High Population Growth

New Zealand annual net migration hit a new high in October as more people arrived from than departed for Australia for the first time in more than 20 years. More>>


Citizens' Advice Bureau: Report Shows Desperate Housing Situation Throughout NZ

CAB's in-depth analysis of over 2000 client enquiries about emergency accommodation shows vulnerable families, pregnant women and children living in cars and garages, even after seeking assistance from the Ministry of Social Development and Housing New Zealand. More>>


Speaking For The Bees: Greens Call For Neonicotinoid Pesticide Ban

The National Government should ban the use of controversial pesticides called neonicotinoids after evidence has revealed that even at low doses they cause harm to bee populations, the Green Party said today. More>>


Science Awards: NZAS Celebrate NZ Scientific Achievements

The Marsden Medal is awarded for a lifetime of outstanding service to the cause or profession of science, in recognition of service rendered to the cause or profession of science in the widest connotation of the phrase. This year’s medal is awarded to Dr Mike Andrews. More>>


Court Rules: Affco 'Unlawfully' Locked Out Meat Workers

The note says the full court found for the plaintiffs, "that is that the defendant locked out the second plaintiffs unlawfully and that it breached s 32 of the Act by acting otherwise than in good faith towards the plaintiffs while collective bargaining was still going on." More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news