Monday, 25 September 2023 09:03

Synlait posts $4.3m loss

Written by  Sudesh Kissun
Canterbury milk processor Synlait has posted a loss of $4.3 million for 2023 financial year. Canterbury milk processor Synlait has posted a loss of $4.3 million for 2023 financial year.

Troubled Canterbury milk processor Synlait has posted a loss of $4.3 million for 2023 financial year, a major reversal from a $38m profit the previous year.

The company’s total revenue was down 3% to $1.6 billion and total group earnings before interest, taxes, depreciation, and amortization (EBITDA) down 31% to $90.7m.

Operating cashflow was down 83% to $39m, capital expenditure down 32% to $65.1m and net debt up 21% to $413.5m.

Synlait chair Simon Robertson described the financial results as “challenging and not where we need them to be”.

But he says they are building the foundations for a stronger Synlait, playing to its strengths while continuing to diversify products, markets, and customers.

“Our refreshed strategy leverages Synlait’s strengths in our world-class capabilities and experience in partnering to produce high-value Advanced Nutrition and Foodservice products."

The company plans to address its balance sheet over the coming 12 months, including divesting Dairyworks and Temuka cheese assets.

Roberston says the company also plans to right size its cost base to current activities and near-term growth opportunities; deliver and build on our current and prospective Advanced Nutrition and Foodservice customer opportunities; and lift operational performance.

Synlait chief executive Grant Watson admitted that it was an extremely challenging year for Synlait.

He says various factors contributed to the poor financial performance, including material reductions in customer demand, extreme weather events, the Covid-19 pandemic, inflationary impacts on cost base, and costs associated with the launch and stabilisation of enterprise resource planning (ERP) system.

“Some factors were outside our control, and others were within our control. Thank you to our shareholders, staff, farmer suppliers, and customers for your support. We are focused on getting the basics right, lifting our performance, and returning to profitability, as we look ahead to a new and exciting era in Synlait."

More like this

Asset sale 'won't be easy'

Troubled milk processor Synlait Milk won’t find it easy to offload under-utilised South Island assets.

Synlait could sell milk plant, canning facility

A poor half-year financial result is forcing listed Canterbury milk processor Synlait to carry out “a strategic review” of its North Island assets, including its new plant at Pokeno and blending and canning facility in Auckland.

Featured

Vaccinate against new lepto strain

A vet is calling for all animals to be vaccinated against a new strain of leptospirosis (lepto) discovered on New Zealand dairy farms in recent years.

TV series to combat food waste

Rural banker Rabobank is partnering with Food Rescue Kitchen on a new TV series which airs this weekend that aims to shine a light on the real and growing issues of food waste, food poverty and social isolation in New Zealand.

National

Frontline biosecurity 'untouchable'

Biosecurity Minister Andrew Hoggard has reiterated that 'frontline' biosecurity services within Ministry for Primary Industries (MPI) will not be cut…

Machinery & Products

New name, new ideas

KGM New Zealand, is part of the London headquartered Inchcape Group, who increased its NZ presence in August 2023 with…

All-terrain fert spreading mode

Effluent specialists the Samson Group have developed a new double unloading system to help optimise uphill and downhill organic fertiliser…

» Latest Print Issues Online

Milking It

Plant-based bubble bursts

OPINION: Talking about plant-based food: “Chicken-free chicken” start-up Sunfed has had its valuation slashed to zero by major investor Blackbird…

» Connect with Dairy News

» eNewsletter

Subscribe to our weekly newsletter