LIC ends year with $30.6m profit
Herd improvement company LIC has ended the 2024-25 financial year in a strong position - debt-free and almost quadrupling its net profit.
For the half year ending December 31, 2024, Farmlands is reporting a 14% increase in revenue, to $477.6 million.
It says this reflects that customers are buying more from their Kiwi-owned co-op.
An improved half-year EBITDA - up 49% to $17.7m - is the realisation of operational improvements made over the last 36 months – indicating that Farmlands is growing smarter and more efficiently, it says.
“Delivering a strong first-half result is vital as it includes spring – the most important season for rural supplies, says Farmlands chief executive Tanya Houghton.
“This result means we are in a good position to continue to support our farmers and growers in the second half of the year, while holding our financial position,” says Houghton.
She adds that the co-op’s focus on operational efficiency is delivering these positive results and that they are not coming at the expense of customer service and benefits.
"We're building a stronger Farmlands that's better equipped to serve our shareholders. These financial numbers show we're moving in the right direction, and the improved customer sentiment we’re seeing is just as important."
Farmlands customers and shareholders are demonstrating that they understand what the co-op is working to do: provide key farm inputs at the best possible price, delivered when they are needed.
Customer sentiment is 27% up on the same period last year. Satisfaction with product range and pricing has improved significantly, which demonstrates the effectiveness of the recently completed three-year product and supply-chain transformation. Customer perception of staff knowledge and expertise has also grown through a period where Farmlands has been investing in its frontline teams, including in key sectors like horticulture and agronomy.
“We are just beginning to see the improvements that were baked into our transformation strategy, and our customers and shareholders are set to benefit even more in future as a strong financial position becomes our foundation for growth,” says Houghton.
Key indicators of smart investment, innovation, and growth:
- Digital innovation is at the heart of Farmlands' strategy. Over 7,000 shareholders have downloaded FarmlandsPRO, a new order placing and managing app, and $70 million in sales have been processed through it. 10,000 shareholders have downloaded the Farmlands Card App – which is supporting them to find the best Card Partner deals and better manage their accounts.
- The acquisition of SealesWinslow and follow-up purchase of the Winton mill facility to establish a national feed business are already releasing significant operational efficiencies. Fern Energy, Farmlands’ joint-venture bulk fuel business, is only into its third year and continues to grow.
- Farmlands’ new Southland regional hub, the first of a model to be applied in other parts of the motu, is creating savings in freight costs and improving on-farm deliveries.
- Direct sourcing of products is providing greater choice and better pricing for customers. New ranges include agri-chemical brand, Agstar, and the soon-to-be-launched Top Paddock rural supplies range.
- Three new retail stores in the North Island will be opening in the second half of the year, in Hastings, New Plymouth, and another North Island location soon to be confirmed. This follows the recent opening of Farmlands' first Horticulture Hub in Hastings.
"The relationship between Farmlands and our shareholders is built on mutual support. As the farming sector strengthens, having a strong cooperative that consistently delivers value will be more important than ever,’ says Houghton.
