Final payout great for all New Zealanders

Fonterra Shareholders’ Council Chair Simon Couper said Fonterra’s record final payout for the 2010/ 2011 season is a great result for Fonterra farmers and one all New Zealanders will benefit from.

Couper: “The record payout has been driven by record revenues which equates to over 10 times the forecast total economic activity of $1.15bn for the 2011 Rugby World Cup.

“This is a great result not only for Fonterra farmers but New Zealand as a whole.”

The dairy co-operative today reported a record payout (before retentions) for shareholders of $8.25 for the 2010/ 2011 season, the highest in the 10 year history of the company and over $1.30 more than the forecast of $6.90 announced by the board earlier in the year.

“The $1.30 increase in our annual payout equates to more than a $300 flow through to every New Zealanders’ pocket and shows that all Kiwis benefit from a strong Fonterra.

“It is a heartening result for shareholders especially given the struggles of the past couple of years when many farmers have faced the impact of drought conditions and are recovering from volatile markets, said Couper.

“The payout presents an opportunity for farmers to reduce the high debt ceiling they carry and put money back into their businesses and with 50 cents from every dollar a famer earns going back into the local economy the extra payout is great news for our communities.”

While encouraged with the result Couper said there are still some areas the Council believes require more attention from the Board.

“The rise in corporate costs and the fall in normalised earnings in the Australia–New Zealand business segment is something the Shareholders’ Council will be keeping an eye on.

“We will be watching the board’s strategy to overcome the issues in these areas with great interest.”

Despite this Couper said the results showed the co-operative is in a strong position to continue to compete on a global scale and continue delivering growth, innovation and economic benefit to New Zealand.

“We believe that Fonterra forms one of the important backbones of the New Zealand economy, representing over a quarter of New Zealand’s exports. We are proud that Fonterra is doing what it was set up to do and proud that this is good for Fonterra farmers and good for the economy.

“With a more stable capital base and solid returns for shareholders we can continue to build on our success and move to the next level as we develop our co-op to its full potential.”