Interim Results Announcement Encouraging

22 March 2017

Interim Results Announcement Encouraging, in Line with Expectations

Fonterra Shareholders’ Council Chairman, Duncan Coull, said today’s interim results announcement was an encouraging one which was in line with the expectations of the Council and Fonterra Farmers.

Mr Coull said the Board’s decision to pay out an interim dividend of 20 cents per share, while maintaining the forecast Milk Price at $6 per kg/MS, would raise Farmers’ confidence and enable them to alleviate cash-flow pressures which have built up over the past few seasons.
“It is encouraging that our Farmers and local communities are now benefitting from global milk prices and that the Fonterra business - despite the increased headwinds of a higher Milk Price - is performing very well and putting the Co-op in a strong position.

“This is evidenced not only by the interim dividend but also in the gearing ratio reduction which is indicative of the significant financial discipline measures that have been on display in the business over the past few years.

“It is also positive to see that product movement from ingredients to consumer and foodservice has added considerable earnings to the balance sheet with Greater China being a particular highlight with a volume increase of 32% and normalised EBIT rising from $68 million to $96 million.”

Mr Coull said despite this strong outlook there is a further six months to go before the full numbers are realised.
“While our Co-op is well-positioned it is always best that Farmers err on the side of caution with regard to their financial planning, that said the Council looks forward to Management continuing to drive the business hard and to the current positive momentum continuing.”

ENDS

© Scoop Media