Fonterra,the New Zealand dairy group,put in a"strong operating performance"in the last year,its CEO said today(26 September)after announcing a cut in the payout to its farmer-owners.
Theo Spierings pointed to a 2%increase in normalised annual earnings,which excluded items such as restructuring costs,and said the company had managed to"add value"despite lower commodity prices.Fonterra's GlobalDairyTrade index,which measures prices of dairy commodities,hit a 34-month low in May.
An over-supply of milk pushed down milk prices and led Fonterra to cut its payout to farmers by 19%for the 2011/12 financial year to the end of July.
However,Spierings said:"We know volatility is here to stay and we showed our ability to manage this volatility by adding value to our products,generating prices above GDT."
Normalised earnings were NZ$1.03bn,higher than last year despite flat revenues of NZ$19.8bn.Net profit after tax fell 19%to NZ$624m but Fonterra said last year's number was boosted by tax credits of NZ$202m.
