NZ Farming Systems ekes out US$367,000 1H profit as milk sales climb
Feb. 29 (BusinessDesk) - NZ Farming Systems Uruguay, the South American dairy farmer that was bailed out by Singaporean owner Olam International, eked out a small profit in the first half on higher milk sales and a one-time accounting gain on he value of livestock.
Profit was US$367,000 in the six months ended Dec. 31, from a loss of $6.77 million a year earlier, the company said in a statement. Sales jumped 81 percent to $34 million.
Farming Systems first-half result would have been a loss of $5.1 million, if not for a fair-value adjustment on livestock of US$5.5 million. In the year-earlier period there was no adjustment.
Milk production climbed to 83.2 million litres from 55.1 million litres a year earlier and the company benefited from a rise in the average milk price to 39.8 US cents a litre from 32.9 cents.
Farming Systems was established in 2006 by executives and directors of PGG Wrightson to apply New Zealand’s expertise in dairy farming to low-cost farmland in Uruguay. It struggled to raise funds in the global financial crisis and is now 86 percent owned by Olam, which came up short in its takeover offer.
That means a South American company owned by a Singapore-based food commodities group remains listed on the NZX though only a small minority of its shares are available for trading. The stock was last at 62 cents.