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

 

Fonterra Announcement Disappointing

10 August 2018

Fonterra Announcement Disappointing, Definitive Plan of Action Required


Duncan Coull, Chairman of the Fonterra Shareholders’ Council, has expressed his absolute disappointment with today’s Board decision to reduce the 2017/18 forecast Farmgate Milk Price by five cents to $6.70 per kg/MS in order to support the balance sheet, and the decision to retain more of the Co-op’s earnings which will likely see no further dividend payment to Shareholders over the 10 cents distributed earlier in the year.

Mr Coull: “I can understand the Board’s rationale and that it is prudent to protect the balance sheet, but the fact that we find ourselves in this situation is unacceptable.

“While Council acknowledges that part of governance is managing risk, another key responsibility is to create long term value for Shareholders. Given today’s announcement the question is ‘how effectively is this being done?’. Shareholders and all New Zealanders have valid expectations that Fonterra delivers.

“It shows that the Council-commissioned independent review into Fonterra’s value creation over time, which will be presented to Shareholders in the coming months, is timely as is the Council-led Purpose and Vision workstream which seeks to provide greater clarity as to who we are, why we exist, and the legacy our people would like to see Fonterra create.

“The Board and Management have some challenges ahead in rebuilding confidence through consistent performance and prudent management of Shareholders’ capital.

“Having effectively retained an extra 20-25 cents Council will seek to understand how this will be used and to what extent it will influence our gearing and credit rating as the strength of both is fundamental moving forward.

“The Board and Management can look forward to some very challenging discussions with Council over the coming weeks and we will be seeking a very clear understanding of the plans that are being implemented in order to restore confidence in the Shareholder base.”

ENDS

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Collecting Scalpers: Commerce Commission To Sue Viagogo

The Commission will claim that Viagogo made false or misleading representations: • that it was an “official” seller, when it was not • that tickets were limited or about to sell out • that consumers were “guaranteed” to receive valid tickets for their event • about the price of tickets... More>>

ALSO:

Price Of Cheese: Fonterra CEO Goes Early After Milk Price Trimmed

Aug. 15 (BusinessDesk) - Fonterra Cooperative Group chief executive Theo Spierings is leaving the role early after the world's biggest dairy exporter lowered its farmgate payout and trimmed its dividend to retain cash. More>>

ALSO:

9.2 Percent: Gender Pay Gap Second-Smallest On Record

This is the second-smallest gap since the series began 20 years ago. In comparison, the gender pay gap was 9.1 percent in 2012 (the lowest on record) and 9.4 percent last year. More>>

ALSO:

Forest & Bird: Report Find Council Failures On Effluent

The report exposes significant inconsistencies and gaps in how regional councils are enforcing the rules around dairy effluent management. More>>

ALSO:

Mana In Mahi: Helping Young New Zealanders Into Work

Thousands of young people will be given the chance to gain valuable qualifications and meaningful work under the Mana in Mahi – Strength in Work scheme launched by Prime Minister Jacinda Ardern today. More>>

ALSO:

Reserve Bank: Official Cash Rate Unchanged At 1.75 Percent

The Official Cash Rate (OCR) remains at 1.75 percent. We expect to keep the OCR at this level through 2019 and into 2020, longer than we projected in our May Statement. The direction of our next OCR move could be up or down. ... More>>