Solid third quarter result for Fonterra
Fonterra has announced an improved third quarter performance – with a profit after tax of $1.15 billion, up $119 million on the same period last year.
Pleased, but cautious. That’s how PGG Wrightson chief executive Stephen Guerin says he’s feeling about the rural retailer’s latest financial result.
Last week, the company released its half-year results to December 2024. Those results saw earnings before interest, taxes, depreciation and amortisation (EBITDA) jump 13% and its net profit after tax (NPAT) rise by 25%.
It’s a marked improvement on the company’s 2024 full-year result which saw EBITDA drop 17% and NPAT drop to $3.1 million.
However, Guerin says that he’s cautiously optimistic about the result as the sector’s economic conditions show early signs of improvement.
“We are seeing some improved confidence in the sector, that’s playing out in terms of the Federated Farmers survey… we’re seeing improved commodity prices for our farmer-growers,” he told Dairy News.
The most recent Federated Farmers Farmer Confidence survey saw farmer confidence at its highest level in over a decade, surging from -66% in July 2024 to +2% in January 2025.
“Interest rates are in our customers’ favour and hopefully that plays out in terms of improved confidence levels as well,” Guerin says.
However, he says the sector is still facing its challenges. “Not everything is looking up, there’s a few challenges within the sector,” he says.
“There is the conversation across the sector about what do tariffs look like for rural New Zealand, but until we see that detail, that’s just a conversation at the moment,” he adds. “Until we see that detail, we’re just getting on with life as the rural sector tends to do.”
Guerin says PGG Wrightson is “reasonably confident” for 2025.
He says there are more signs pointing towards improved farmer confidence and improved business outcomes for the retailer and its farmers than there are towards a negative year.
“There could be some movement in input prices for our farmers,” he says, adding that if those input prices were to rise, it could be a problem.
“There is a weaker New Zealand dollar. That does improve commodity prices for sales output, but it does result in some higher input prices for our farmer clients. We’ve seen that recently with some of the fertiliser companies bringing their prices up.
“Commodity cycles do come and go, but if you look at the average and you look at the market indicators right at the moment, there are a few things that would suggest this has a wee way to run at the moment, but it doesn’t take much to knock some confidence,” he concludes.
Newly appointed National Fieldays chief executive Richard Lindroos says his team is ready, excited and looking forward to delivering the four-day event next month.
More than 70 farmers from across the North and South Islands recently spent a dayand- a-half learning new business management and planning skills at Rabobank Ag Pathways Programmes held in Invercargill, Ashburton and Hawera.
Government ministers cannot miss the ‘SOS’ – save our sheep call - from New Zealand farmers.
A tax advisory specialist is hailing a 20% tax deduction to spur business asset purchases as a golden opportunity for agribusiness.
Sheep and beef farmers have voted to approve Beef + Lamb New Zealand signing an operational agreement between the agricultural sector and the Government on foot and mouth disease readiness and response.
The head of the New Zealand Kiwifruit Growers organisation NZKGI says the points raised in a report about the sector by Waikato University professor Frank Scrimgeour were not a surprise.
OPINION: The Free Speech Union is taking this one too far.
OPINION: New national data from The Drug Detection Agency (TDDA), a leading workplace drug tester, shows methamphetamine (meth) use is…