Profit up, room for improvement at Silver Fern Farm

Work to be done: Silver Fern Farms chief executive Simon Limmer says the 2018 after-tax result “is not at the level we are aiming to achieve for the company”.
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SILVER Fern Farms has recorded a net profit before tax of $2.4 million for the year to December 31, 2018.

The after-tax result for the period was a net profit of $0.9m.

That result reversed an after-tax loss of $5.6m in 2017, although the 2017 result was over a 15-month period and included losses from discontinued operations.

Silver Fern Farms Co-operative chairman Rob Hewett said the co-operative would receive a $874,000 dividend from their 50 percent shareholding.

While significantly down on last year’s $4.1m dividend, the business was pleased to be in a position to pay a dividend to its two shareholders.

The $874,000 dividend the co-operative was receiving represented the first time that Silver Fern Farms Limited had paid back-to-back distributions to its shareholders out of operating profit, Mr Hewett said.

“The co-operative remains in a strong position with no debt.”

Mr Hewett stated the board was determined to support moves to improve the performance of its investment in Silver Fern Farms Limited.

“It should be noted that our investment . . . is undergoing a process of consolidation.

“(The business) is in a period of intensive capital investment across infrastructure and systems to ensure it can sustain a high level of performance.

“While the level of profitability is lower than desirable as it goes through this process, we have an expectation that we will be in a position to derive future value from our equal share in the company. This is in addition to the high level of service supplying shareholders currently receive.”

For the year to December 31, Silver Fern Farms Limited achieved sales of $2.4 billion, earnings before interest, tax, depreciation and amortisation, including a share of associate earnings, of $32.4m, and net profit after tax of $5.8m.

The company increased the level of capital expenditure, up $8m to $29m, across health and safety, compliance, asset replacement and operational improvement over the course of the year.

Silver Fern Farms Limited chief executive Simon Limmer said: “The 2018 after-tax result, while it represented a back-to-back profit for the business, is not at the level we are aiming to achieve for the company.”

“It is acknowledged we must lift the profitability of the business in order to sustain our aggressive capital reinvestment programme, and to more actively progress our in-market investment in sales and marketing to grow value in the market.”

“Alongside the significant capital investment in Silver Fern Farms, the company continued to pay out strong farm-gate pricing across all species.”

SILVER Fern Farms has recorded a net profit before tax of $2.4 million for the year to December 31, 2018.

The after-tax result for the period was a net profit of $0.9m.

That result reversed an after-tax loss of $5.6m in 2017, although the 2017 result was over a 15-month period and included losses from discontinued operations.

Silver Fern Farms Co-operative chairman Rob Hewett said the co-operative would receive a $874,000 dividend from their 50 percent shareholding.

While significantly down on last year’s $4.1m dividend, the business was pleased to be in a position to pay a dividend to its two shareholders.

The $874,000 dividend the co-operative was receiving represented the first time that Silver Fern Farms Limited had paid back-to-back distributions to its shareholders out of operating profit, Mr Hewett said.

“The co-operative remains in a strong position with no debt.”

Mr Hewett stated the board was determined to support moves to improve the performance of its investment in Silver Fern Farms Limited.

“It should be noted that our investment . . . is undergoing a process of consolidation.

“(The business) is in a period of intensive capital investment across infrastructure and systems to ensure it can sustain a high level of performance.

“While the level of profitability is lower than desirable as it goes through this process, we have an expectation that we will be in a position to derive future value from our equal share in the company. This is in addition to the high level of service supplying shareholders currently receive.”

For the year to December 31, Silver Fern Farms Limited achieved sales of $2.4 billion, earnings before interest, tax, depreciation and amortisation, including a share of associate earnings, of $32.4m, and net profit after tax of $5.8m.

The company increased the level of capital expenditure, up $8m to $29m, across health and safety, compliance, asset replacement and operational improvement over the course of the year.

Silver Fern Farms Limited chief executive Simon Limmer said: “The 2018 after-tax result, while it represented a back-to-back profit for the business, is not at the level we are aiming to achieve for the company.”

“It is acknowledged we must lift the profitability of the business in order to sustain our aggressive capital reinvestment programme, and to more actively progress our in-market investment in sales and marketing to grow value in the market.”

“Alongside the significant capital investment in Silver Fern Farms, the company continued to pay out strong farm-gate pricing across all species.”

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