The share price rose above $4 for the first time in about three months.
Bega reported an earnings before interest and tax of $149 million (down from $184 million last year) on a $3 billion turnover — the first time the company had reached this figure.
The company knocked off about $60 million from its debt load during the year.
Executive chairman Barry Irvin pointed to the company’s profit despite the challenges of COVID-19, record flooding, transport challenges and the global impact of the Ukraine war.
He said in the annual report the Australian dairy industry continued to experience decreases in milk production, with a reduction in national supply of about four per cent to 8.5 billion litres.
In general, climatic conditions were positive from a farming perspective, although a number of regions were significantly impacted by wet weather and flooding events.
“The shortage of farm labour and alternative land use options combined with high property prices have accelerated retirement plans for some dairy farmers,” Mr Irvin said.
“Increasing competition for traditional dairy farming assets has impacted dairy farmers wishing to expand their operations, although we do observe ongoing investments by many of our dairy farmers.”
Chief executive officer Paul van Heerwaarden said in the annual report the acquisitions in recent years of Bega Foods, Peanut Company of Australia, the Koroit dairy plant and Bega Dairy and Drinks had transformed the company.
“These acquisitions have diversified our product offering, expanded our distribution capability and reduced risk in our supply chain through greater flexibility,” Mr van Heerwaarden said.
“This has positioned us to navigate disruption, extract value and continue to grow.
“An immediate challenge is inflationary pressure and how we mitigate higher costs through a range of mechanisms including, but not limited to, pricing, growth, cost control and productivity.
“The benefit of increased consumer prices has started to flow through in FY2023 across all channels and product categories.
“As foreshadowed in June, we expect competition for farm gate milk to remain robust in FY2023.”
This was the first full year the company has owned the business formerly known as Lion Dairy and Drinks, acquired in January 2021.
The branded segment of the group reported growth of 63 per cent to $2.5 billion.
The annual report disclosed that the executive chairman’s fixed remuneration was set below $1 million.
The Bega Group announced a fully franked dividend of 5.5 cents per share, taking the total dividend for the year to 11 cents.
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