Speaking at the release of the company’s annual financial results, chief executive officer Miles Hurrell said the Australian business was going well and it would play a key role in helping them get to their 2030 strategic targets.
Some time ago Fonterra announced it was undertaking a strategic review of the Australian division, including ownership options.
Meanwhile the company is moving ahead with plans to sell off its Chilean dairy manufacturing business, Soprole.
“As part of the strategic review of the ownership of our milk pools outside New Zealand, we continue to make progress, with the sales process for the Soprole business progressing.,” Mr Hurrell said.
“Meanwhile, we’ve looked at a number of options for our Australian business and have decided that it’s in the co-op’s best interests to maintain full ownership.
“Australia plays an important role in our consumer strategy with a number of common and complementary brands and products and as a destination for our New Zealand milk solids.
“As part of our strategy to 2030, we set a goal of a return of about $1 billion to shareholders and unit holders which anticipated divestments including Soprole and a stake in our Australian business.
“Even though we have decided not to sell a stake in our Australian business, we are still committed to targeting a significant capital return to our shareholders and unit holders.
Fonterra announced a profit of NZ$591 million for the year ending July 31, with a farm gate milk price of NZ$9.30/kg of milk solids.
“The co-op is pleased to be able to pay a total dividend of 20 cents per share for our farmer owners and unit holders,” Mr Hurrell said.
“And this year’s higher farm gate milk price is the strongest it has ever been, which is great news for our farmers.
“New Zealand also benefits from this, with $13.7 billion returned into the economy in milk price payments alone this year.”
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