Wednesday, 17 June 2020 09:15

Anzco turns the ship around in 2019

Written by  David Anderson
Anzco chief executive Peter Conley says market diversification was an important strategy for the company in 2019. Anzco chief executive Peter Conley says market diversification was an important strategy for the company in 2019.

Meat company Anzco Foods has recorded a $60m-plus profit turnaround for the 2019 year.

The company recorded its best ever revenue of $1.7b and a net profit before tax of $30.6m for the year ended 31 December 2019. This is the company’s third highest profit ever and a vast improvement on the pre-tax loss of $39.1m in 2018.

Anzco’s 2019 result compares with Silver Fern Farms pre-tax profit of $89.6m on sales of $2.6b and Alliance’s profit of $20.6m on $1.7b turnover for the same year. 

“In 2019, we made record payments to farmers for the second year in a row ensuring the benefits of higher market prices have been shared across the value chain,” says chief executive Peter Conley. 

“We regularly measure payments to farmers for sheep and beef, and we have consistently paid premium prices when benchmarked with the wider industry.” Conley claims market diversification was an important strategy for the company in 2019, with the business focusing on expanding its beef, lamb and healthcare products in a range of markets including New Zealand, Japan, the UK, Europe, North America, and China. 

“As the year progressed, global demand for New Zealand beef and lamb products continued to improve which provided a sustained period of higher market returns. 

“Despite the risks of volatility and the emergence of trade-related conflicts in global markets, red meat pricing increased steadily during the year, with China standing out as a significant market for both beef and lamb products.” 

Conley added that the company continued to offer a diversified portfolio of meat, value-add and healthcare products, with Japan, the UK, Europe and North America all remaining integral to balancing market options. 

The company says its $11m investment in automation in 2018 at its Rangitikei lamb processing operation had delivered significant gains in 2019. 

Meanwhile, Conley concedes that this year has been tougher from the start with Lunar New Year hitting sales in January closely followed by the Covid-19 pandemic. 

Conley attributes much of the improvement in 2019 to the adoption of the sales and operations planning system, which matches customer orders and product specifications to inform livestock procurement and production planning, thus reducing inventory levels and wastage. 

He says the system provides much better market signals, taking advantage of Anzco’s in-market resources and close customer relationships in key markets including Japan, China, Germany, Britain and the United States.

Last year also saw significant growth in Anzco’s added-value business, which already represented 10% of turnover in the previous trading period. 

The Primary Growth Partnership FoodPlus initiative, completed during the year, produced two successful developments, notably the Bovogen blood product business and healthcare products. Other profitable added-value units are the beef jerky plant and the beef patty production plant. However, both had been severely disrupted by food service restrictions during the Covid-19 lockdown.

Anzco is majority owned by Japanese giant, Itoham Yonekyu Holdings (IYH), the ninth largest meat company in the world.

More like this

Back the sector that backs NZ

OPINION: The biggest issue currently facing our industry is environmental policy, writes Beef+Lamb NZ chief executive Sam McIvor.

Meat quota rates remain vital

A jump in the value and volume of New Zealand’s sheepmeat exports to Europe and the UK shows why preserving WTO tariff-rate quotas is so important, claims the Meat Industry Association (MIA).

Quota split a major worry

New Zealand meat exporters want the EU and UK to get serious on reaching a deal on post-Brexit quotas.

Featured

 

John Deere names new Aust/NZ head

John Deere Australia/New Zealand’s new managing director Luke Chandler says he will prioritise leading the way in technology and investing in strong relationships.

Trade deal delivers new 'rulebook'

A new trade agreement, the Regional Comprehensive Economic Partnership (RCEP), has been described as a new rule book for trade in the Asian region.

National

Wyeth ready for the 'Coast'

The chief executive-elect of Yili-owned Westland Milk Products Richard Wyeth is looking forward to the challenge of running the company.

Machinery & Products

Weeds in for a shock

WIith an increasing focus on reducing chemical herbicides, largely because of crop resistance and a potential build-up of residues, new…

V8 - a baler with a grunt

Following three years of testing with clients worldwide, Ireland-based manufacturer McHale has added a bigger model to its range of…

Virtual CV valuable tool

With a 12-year history of recruiting specialised operators from overseas to service the agricultural contracting industry, Hanzon Jobs typically brings…

» The RNG Weather Report

» Latest Print Issues Online

The Hound

Action, please!

The Hound notes that despite the new government having been elected for well over a month, there seems to a…

Educated?

Your canine crusader is intrigued to learn that the upper-class twats who attend Oxford University in the UK have voted…

» Connect with Rural News

» eNewsletter

Subscribe to our weekly newsletter