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Fonterra posts $1.3bn turnaround, reports $659m profit

18th September 2020 By Staff Reporter | | @foodtickernz

Fonterra tanker

Fonterra has posted an after tax profit of $659m for the year to July 2020, a $1.3bn turnaround from the $605m loss it made the previous year.

Excluding one-offs, the dairy co-op made an underlying profit of $382m for FY20, up 44.7% noon FY19.

It said it would pay farmers $7.14 per kilo of milk solids, as well as a 5 cents per share dividend.

“We increased our profit after tax by more than $1bn, reduced our debt by more than $1bn and this has put us in a position to start paying dividends again,” chief executive Miles Hurrell said.

“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.”

Hurrell said Fonterra’s ingredients business, which makes milk powders, saw strong sales, and its China food service business had improved despite the Covid-19 pandemic.

“There continues to be significant uncertainties – including how the global recession and new waves of Covid-19 will impact demand globally, and what will happen to the price relativities between the products that determine our milk price and the rest of our product range.”

The co-op forecast a payout range of $5.90 to $6.90 a kilo for the current season.



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