Wednesday, 21 August 2019 10:55

$35m rebate for fert co-op owners

Written by  Nigel Malthus
Ravensdown chairman John Henderson. Ravensdown chairman John Henderson.

Fertiliser co-op Ravensdown has posted a pre-tax profit and rebate of $52 million for the year ended May 31, 2019.

“Another good financial result”, although down 17.5% from the $63m recorded in 2018, the co-op says.

The profit was impacted by several factors. 

“These included foreign exchange movements and higher world commodity prices leading to higher interest and inventory costs. As part of its all year value commitment, prices charged in New Zealand were held at a level that impacted on margins. 

“Investment continued in precision mapping and spreading technology, more environmental specialists were recruited and a Holiday Act remediation of $1.3m was set aside.”
The co-op is paying $35m ($30/tonne) in rebates to farmers who bought fertiliser during the financial year, half via an interim payment in June and the rest to be paid in August.

“After five years of consistently profitable results, our shareholders tell us the rebate in any one year is not the be-all and end-all,” said chairman John Henderson.

“What matters to them is a sustainable cooperative that offers great service, quality products, certainty of supply, competitive pricing through the 12 months and ways to help them perform long term.”
For governance purposes and balance sheet strength the co-op is retaining $12m for reinvestment.

Henderson says Ravensdown is spending on services, products and technologies for its shareholders as they face disrupted times. 

“We need to invest and innovate to help shareholders reduce their environmental impacts and achieve their production goals.”
Chief executive Greg Campbell said the co-op has to keep a close eye on costs. 

“Healthy cooperatives maintain their long term ability to support their owners by being able to retain earnings rather than turn to debt or erode equity. 

“Smarter farming requires environmental performance and nutrient management, not maximum fertiliser tonnages or short-term gain.”

Campbell referred to the co-op having this year won awards for “cutting edge effluent technology ClearTech, the progress of our farm environmental consultancy and the HawkEye nutrient mapping tool which puts control in the palm of the farmer’s hands”.

Its IntelliSpread precise aerial fertility scanning and application technology resulted in 18% of customers’ farmed areas not getting fertiliser because they are environmentally sensitive or unproductive.
“We are well positioned to help farmers with their social licence to operate, but these improvements and innovations need long-term investment,” said Campbell.

Fertiliser tonnages were static but sales of the coated urea N-Protect product, which helps reduce the amount of nitrogen lost to the atmosphere, increased by 75%. 

And 83% of surveyed customers rated fertiliser product quality as ‘excellent’ or ‘very good’. Quality rating and sales of animal health, agrichemicals and seeds were positive, with seeds having a record year.
“We have already invested over $165m in five years in our physical assets and our stores network is in continued need of renewal. This is important if we can improve service efficiency, product quality and safety,” said Campbell. 

“Dust, noise and stormwater issues can all impact on nearby communities and of course the staff who work there. We have spent $10.7m on asbestos removal, stormwater improvements and dust management and there’s much still to do.”

More like this

Agnition announces new online sales channel

Ravensdown’s venture arm, Agnition, has announced a new online sales platform in an effort to give Kiwis more choices for how they purchase fertiliser and other agricultural products.

Featured

Being a rural vet is ‘fantastic’

Everyone from experienced veterinarians and young professionals to the Wormwise programme and outstanding clinics have been recognised in this year’s New Zealand Veterinary Association Te Pae Kīrehe (NZVA) awards.

Editorial: Long overdue!

OPINION: The Government's latest move to make freshwater farm plans more practical and affordable is welcome, and long overdue.

National

Lame stories from a country vet

Everyone from experienced veterinarians and young professionals to the Wormwise programme and outstanding clinics have been recognised in this year’s…

Machinery & Products

Gongs for best field days site

Among the regular exhibitors at last month’s South Island Agricultural Field Days, the one that arguably takes the most intensive…

Amazone extends hoe range

With many European manufacturers releasing mechanical weeding systems to counter the backlash around the use and possible banning of agrochemicals,…

Gong for NH dealers

New Holland dealers from around Australia and New Zealand came together last month for the Dealer of the Year Awards,…

» Latest Print Issues Online

Milking It

Less hot air

OPINION: Farmers won't get any credit for this from the daily media, so Milking It is giving the bouquets where…

Dollars go offshore

OPINION: The Advertising Standards Authority’s 2024 report revealed that not only is social media rotting our brains, it is also…

» Connect with Dairy News

» eNewsletter

Subscribe to our weekly newsletter