NZ's Fonterra posts profit dip as bad weather hits production
New Zealand dairy group Fonterra reported an 11pc fall in full-year profit on Monday after bad weather hampered milk production, but gave an upbeat outlook for the coming year.
The world’s largest exporter of dairy products reported net profit after tax of NZ$745 million ($546 million) for the 12 months ended July 31, down from NZ$834 million a year ago. The result was slightly below expectations of about NZ$757 million, according to five analysts polled by Reuters.
Full-year revenue rose to NZ$19.23 billion against NZ$17.20 billion a year ago.
“Despite lower milk volumes due to poor weather in parts of the season, the business delivered a good result by prioritising higher value advanced ingredients,” chairman John Wilson said in a statement.
Fonterra had been able to deliver on its forecast dividend despite changing conditions, and had continued to boost efficiency and develop new revenue streams, he said.
“We are well positioned to deliver higher volumes and new product formats,” Wilson said.
Fonterra has been shifting its business from relying on milk powder shipments to selling value-added consumer products to ride out volatile global dairy prices.
Shares in Fonterra edged up 0.7pc to NZ$6.14 by 2315 GMT, in line with the domestic market.