Fonterra back in the black

He made the comments as the co-op announced a $659 million profit for 2019-20 financial year. The co-op had suffered financial losses during the preceding two financial years.

Investors will also get dividend of 5c/share for 2019-20 after missing out in 2018-29.

The final milk price for last year is 7/19/kgMS including the dividend.

Hurrell says the co-op has increased profit after tax by more than $1 billion and reduced debt by more than $1 billion.

“This has put us in a position to start paying dividends again,” he says.

“I’m proud of how farmers and employees have come together to deliver these strong results in a challenging environment. They have had to juggle the extra demands and stress of COVID-19 and have gone above and beyond. I would like to thank them for their hard work and support.

“This time last year we were announcing our new strategy and customer-led operating model. We were clear that to build a sustainable future we needed to focus on three interconnected goals – Healthy People, a Healthy Environment and a Healthy Business.

“We went on to deliver a strong performance for the first half. However, what none of us could have ever predicted was what then played out – a world facing COVID-19. The flow-on effects of the pandemic did impact our performance in the second half, particularly in our Consumer and Foodservice businesses.”

Annual Results Summary

• Final cash payout for 2019/20 season: $7.19 per kgMS

    - Final 2019/20 Farmgate Milk Price: $7.14 per kgMS

    - 2019/20 dividend: 5 cents per share

• Reported Profit After Tax: $659 million, up $1.3 billion

• Normalised Profit After Tax[1]: $382 million, up $118 million

• Total Group Earnings Before Interest and Tax (EBIT): $1.1 billion, up $1.2 billion 

• Total Group normalised EBIT: $879 million, up $67 million

• Total Group normalised gross profit: $3.2 billion, up $200 million

• Total Group normalised operating expenses: $2.3 billion, down $14 million