FSF - Fonterra Shareholders Fund

[Left Field]

Maybe this announcement makes Fonterra worthy of its own thread...

https://www.nzx.com/announcements/431158

Interesting move.  Certainly boosted the SP yesterday.

[Waltzing]

Its the accounts silly ...  silly business over the accounts...

cows in sweden .. https://mydearsabrina.com/life-in-sweden/wonderfully-quirky-swedish-spring-tradition/

https://www.stuff.co.nz/nz-news/350292387/eys-pr-nightmare-secret-drinking-club-misconduct-allegations-and-resignations

[Left Field]

Optimistic market update

https://www.nzx.com/announcements/431912

Q3 business update and FY25 Farmgate Milk Price

• Continuing operations'* earnings per share: 61 cents
• Reported earnings per share: 58 cents
• Continuing operations' profit after tax: NZ $1,013 million up $20m, or 2%
• Reported profit after tax: NZ $973 million down 27% with the prior period including Soprole performance and net gain on divestments
• Continuing operations' EBIT: NZ $1,440 million down 6%
• Return on Capital: 11.9% up from 11.7% year on year
• Lift in forecast FY24 continuing operations' earnings range: from 50-65 cents per share to 60-70 cents per share
• Opening forecast Farmgate Milk Price for 2024/25 season: $7.25-$8.75 per kgMS with a mid-point of $8.00 per kgMS
• Current season forecast Farmgate Milk Price: midpoint maintained at $7.80 per kgMS, range narrowed to $7.70-$7.90 per kgMS

CEO Miles Hurrell says the Co-op's Foodservice and Consumer channels in particular had a strong third quarter with a lift in earnings compared to the same time last year.

"As a result of this performance, we have lifted our forecast FY24 continuing operations' earnings range to 60-70 cents per share, up from 50-65 cents per share" says Mr Hurrell.

Fonterra also announced an opening 2024/25 season forecast Farmgate Milk Price of $7.25-8.75 per kgMS with a midpoint of $8.00 per kgMS.

[Waltzing]

Good news in the valleys and towns where the cows graze....

"$8.00 per kgMS."

If you live in the country its an invitation to meet at the local country cafe ... GRAZE...

[Waltzing]

Yes and lets hope the audit team has been on a strict low fat milk diet before taking out that pencil...

remember folks dont drink and audit ... not even after hours...

[Habitz]

NZs largest company reported a good result and dividend, shares up strongly. I was expecting more insightful comment on this, and am interested to hear what the many talented stocktalkers have to say

[Habitz]

Forecast 40-60cps fully imputed for 2025. Plus separation/sale of consumer brands worth an estimated $2 per share. On current pricing whats not to like, the market is starting to wake up and re-rate

[Red Baron]

Forecast 40-60cps fully imputed for 2025. Plus separation/sale of consumer brands worth an estimated $2 per share. On current pricing whats not to like, the market is starting to wake up and re-rate

I thought ze 'Vonterra Zhareholders Vund' vas ze 'added value' bit of Vonterra?  Thus vith ze consumer brands zold, there may be less 'added value' to add in ze vuture.  Zhort term, rising milk price at ze varm gate eez an increased eenput cost vor 'VZV'.  Vinds look to be blowing against VZV to me.

RB

[Habitz]

I thought ze 'Vonterra Zhareholders Vund' vas ze 'added value' bit of Vonterra?  Thus vith ze consumer brands zold, there may be less 'added value' to add in ze vuture.  Zhort term, rising milk price at ze varm gate eez an increased eenput cost vor 'VZV'.  Vinds look to be blowing against VZV to me.

RB

and I zought zis column is about Fonterra not Vonterra, get vis ze game Baron hehe

[Habitz]

Hurrell emphasized that this decision would help create a "simpler, higher performing Co-op" and allow Fonterra to allocate resources more efficiently to higher-return areas. While the sale is expected to impact earnings in the short term, Hurrell believes it aligns with the company's long-term strategy to enhance shareholder value.

[Plata]

It seems strange to me for them to sell them. Surely of anyone Fonterra should have the best ability to make these consumer goods at scale, which is the best way to make money on staples. What are the higher return areas anyway?

[Habitz]

From yesterday's agm "higher value probiotics and proteins"

The consumer products businesses have experienced decreasing margins and increased capital demands according to Chairman Pete

[Habitz]

16cps for Q1 fonterra has maintained fy25 guidance of 40 to 60 CPS fully imputed

From interest.co.nz report:

'A strong start'

Commenting on the first-quarter results for the co-op, Hurrell said it was strong start to the year, "especially when taking into consideration the higher cost of milk and narrower price relativities when compared to this time last year".

"While these factors have impacted our gross margins, this has been partially offset by improved product mix, with a greater allocation of milk to higher value products in our Foodservice and Consumer channels.

"We ended FY24 with well managed inventory levels, meaning we started this year with lower levels than the year prior.

"As a result, we have lower sales volumes in our Ingredients channel when compared to this time last year. This channel was also impacted by the continued narrowing of price relativities in New Zealand. This has been partially offset by the realignment of the Australian milk price with global commodity prices.

"While Foodservice and Consumer gross margins have been impacted by the higher cost of milk relative to Q1 last year, it is pleasing to see margins have improved in our global markets since the end of last financial year.

"Operating expenses for the first quarter of FY25 were in line with expectations as we continue to invest in core IT and digital infrastructure and transformation initiatives," Hurrell said.

[Habitz]

CEO of the year, became CEO after the late theo speirrings left a mess

https://www.nzherald.co.nz/business/ceo-of-the-year-fonterras-miles-hurrell-wins-deloitte-top-200-individual-award/YUTYEEPZ4JBZXKUOJLWXA2CNEY/

Understatement of the year: "we had a few issues and we needed to lean into them quite quickly"

[Turkey]

Yeah congrats to them...turned that ship around and good for NZ.

I regret not buying a few shares around $2 mark...been a good result for holders last couple of years...capital gains, capital return and increased divies...well done to holders.

here was his acceptance   speech...lol

It's great that Fonterra has been identified as the cream of the crop. At times it felt like we have been milking the duck but there is no point crying over spilt milk and to finally become the big cheese of nz is a fantastic result for our team .

Theres a few divestments we need to butter up but we will be milking this award for all it's worth until the cows come home.
Thanks again for the recognition....we feel like the cat that got the cream.

Sorry if my post is a bit cheesy...but at least it's not dreary (dairy)