increase font size
Miles Hurrell.
Fonterra chief executive Miles Hurrell says a clear plan is in place to lift the co-op’s performance.
“It relies on us doing a number of things differently,” he says.
The co-op is taking stock of the business -- reviewing all investments, major assets and partnerships to ensure they still meet today’s needs.
“This will involve a thorough analysis of whether they directly support the strategy, are hitting their target return on capital and whether it can scale them up and grow more value over the next two-three years,” he says.
“This will start with a strategic review of the cooperative’s investment in Chinese baby food company Beingmate.”
Fonterra is also looking at “getting the basics right” and has begun acting to fix the businesses that are not performing.
Hurrell says financial discipline will be lifted throughout the co-op so debt can be reduced and return on capital improved.
Farmers will get more accurate forecasting.
The business will be run on more realistic forecasts with a clear line of sight on potential opportunities and the risks.
“It will also be clear on its assumptions, so farmers and unitholders know exactly where they stand and can make the decisions that are right for them and their businesses.”
Chairman John Monaghan says the co-operative is being clear with farmers and unitholders on what it will take to achieve the forecast earnings.
“For the first time, we are sharing some business unit specific forecasts. Among others, these see the ingredients and consumer and foodservice businesses achieving an EBIT of between $850 million and $950m, and between $540m and $590m, respectively.
“FY19 is about lifting the performance of our cooperative.
“We are taking a close look at the cooperative’s current portfolio and direction to see where change is needed to do things faster, reduce costs and deliver higher returns on our capital investments.
“This includes an assessment of all the cooperative’s investments, major assets and partnerships against our strategy and target return on capital.
Foreign Affairs Minister Winston Peters has joined the debate around the proposed sale of Fonterra’s consumer and related businesses, demanding answers from the co-operative around its milk supply deal with the buyer, Lactalis.
OPINION: Farmer shareholders of two of New Zealand's largest co-operatives have an important decision to make this month and what they decide could change the landscape of the dairy and meat sectors in New Zealand.
OPINION: As CEO of the Dairy Board in the 1980s I was fortunate to work with a team of experienced and capable executives who made most of the brand investments that created the international consumer business Fonterra inherited. Soprole in Chile was the largest, but there were more than 20 countries where consumer marketing companies were established and Anchor and other brands were successfully launched.
Fonterra has delivered a fifth straight year of record organic milk price for farmer suppliers.
Fonterra says favourable weather conditions supporting pasture growth is boosting milk production.
Farmers are welcoming the Government’s revised science-based biogenic methane targets for 2050.
Like many manufacturers around the world, European agricultural machinery and tractor manufacturers are currently operating in a difficult market environment. But they are heading to the world’s largest agricultural machinery event in Hanover next month with a degree of cautious optimism.
Established in 2021, the John Deere Technician of the Year Awards champion the important contribution parts and service technicians make to the Australian and New Zealand agriculture, construction and forestry industries.
Foreign Affairs Minister Winston Peters has joined the debate around the proposed sale of Fonterra’s consumer and related businesses, demanding answers from the co-operative around its milk supply deal with the buyer, Lactalis.
The ACT Party says media reports that global dairy giant Nestle has withdrawn from the Dairy Methane Action Alliance shows why New Zealand needs to rethink its approach to climate.
Spinach is NZ's favourite leafy green, according to the Department of Statistics.
OPINION: Ageing lefty Chris Trotter reckons that the decision to delay recognition of Palestinian statehood is more than just a fit…
OPINION: A mate of yours truly recently met someone at a BBQ who works at a big consulting firm who spent…
