Co-op on cusp of 'new and exciting chapter'

"You ain't seen nothing yet," is what Rivers told Dairy News when asked for his final message to the co-op's 9,000 farming families.

"This is just the start of a new chapter for Fonterra and one that is really exciting," says Rivers, who stepped down from September 30. He will attend Fonterra's annual meeting next month before leaving the co-op.

Rivers joined Fonterra in 2018, the year in which the co-op posted its first financial loss.

With Rivers at his side, then interim chief executive Miles Hurrell announced a major review of overseas assets and partnerships.

The co-op decided to focus on extracting value rather than pursue volume and put the focus back on its New Zealand milk pool. Two years later the co-op was back in the black. Last month the co-op announced a net profit of $583 million for last financial year on the back of revenues totalling $23.4 billion.

Rivers says, after the 2018 results, it was clear that Fonterra had to change and everyone could see that.

"We've come a long way since then and credit to Miles and the team, we've worked really hard to get the co-op to where it is now.

"It's not only been about turning the co-op around from a financial point of view but also about creating a positive atmosphere where people feel comfortable to share ideas and communicate openly."

Fonterra farmer shareholders also wanted changes.

"Nothing is lost on New Zealand dairy farmers, who are some of the most financially literate people on earth," Rivers says.

"It was obvious that we needed to change."

The changes required some tough decisions, including realising the co-op's purpose.

"The biggest challenge was the breakthrough in realising what Fonterra's purpose was: collecting milk and transforming it and bringing the cash back home," says Rivers.

"Our previous strategy didn't reflect what our owners wanted."

Rivers says plenty of decisions needed to be made and required a lot of thought.

"We've been able to pull together as a team and get things sorted.

"We're on the right track as a result and everyone is highly motivated to keep improving and to never stop learning."

Rivers has enjoyed his time at Fonterra.

For him it's been rewarding and also a learning curve.

"The co-op is incredibly resilient. The path we're on now, of focusing on getting the most out of New Zealand milk through nutrition science and innovation and by continuing to improve our sustainability story, makes total sense and resonates well with our farmer owners.

"It's great that things are moving in the right direction with the DIRA amendment to enable a flexible shareholding structure.

"It gives farmers more choice about where they put their capital, driving structural tension for the co-op to deliver both a competitive return on invested capital and a sustainable milk price."

Top Result

Marc Rivers says Fonterra is going from strength to strength.

He says the 2022 financial results mean the co-op has been able to deliver both a strong milk price and robust financial performance in a tough global operating environment.

"The co-op paid a total dividend of 20 cents per share for our farmer owners and unit holders.

"And this year's Farmgate Milk Price is the strongest it has ever been, which is great news for our farmers.

"New Zealand also benefits from this, with $13.7 billion returned into the economy in milk price payments alone this year."