New Zealand dairy giant Fonterra has unveiled robust interim results for FY24, marked by a significant rise in profits and an enhanced dividend payout.
CEO Miles Hurrell attributed the firm’s continued success to increased margins and sales volumes across Fonterra’s diverse range of products and categories.
He remarked, “I’m pleased to report we’ve continued the positive momentum seen in our earnings performance and delivered an interim dividend of 15 cents for our Co-op’s farmer shareholders and unit holders, up from 10 cents this time last year.”
“The forecast Farmgate Milk Price has also lifted recently, with a current midpoint of $7.80 per kgMS, following volatility earlier in the season.”
Hurrell further explained, “While supply and demand dynamics remain finely balanced, with continuing global uncertainty, we are now well progressed through the season. This gives us the confidence to narrow our forecast Farmgate Milk Price range to $7.50 – $8.10 per kgMS.”
Fonterra’s reported profit after tax stands at $674 million, a $128 million surge from the previous year.
Earnings Before Interest and Tax (EBIT) from continuing operations have risen by 14 per cent to $986 million over the same period.
The return on capital for the last 12 months has escalated to 13.4 per cent, compared to 8.6 per cent in the prior year, with earnings per share climbing to 40 cents from 33 cents.
Hurrell elaborated on the business performance, citing increased margins and sales volumes in the Foodservice and Consumer channels as primary drivers.
Despite lower returns in the Ingredients channel due to last year’s historic high price relativities, the overall growth trajectory remains strong.
“Looking out to the remainder of the year, while global inflationary pressures are easing, we are monitoring the potential for volatility as a result of geopolitical instability,” affirmed Hurrell.
