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Richard Young.
Despite making a record profit of nearly $71 million, meat processor Silver Fern Farms Ltd has delayed paying any dividend.
The meat company’s joint owners, Silver Fern Farms Cooperative and China’s Shanghai Maling, have requested that a dividend be deferred until the economic situation becomes clearer.
Farmer-owned SFF Co-op, made up 6,200 ordinary shareholders and 15,800 rebate shareholders - reported a net profit of $35m for the financial year.
Co-op chairman Richard Young says it is taking a conservative approach to the current operating environment.
Since SFF Ltd’s balance date of December 31, 2019, the market has fundamentally changed, Young says.
“Market dynamics are changing daily, making scenario modelling of short and medium-term financial impacts difficult to accurately determine.
“Liquidity and cash flow management will continue to be critical in maintaining optionality in managing Silver Fern Farms Limited’s relationships with all stakeholders in uncertain times.
“We remain confident that SFF Ltd is in a strong financial position. With cash on hand in the business, they will be equipped to respond to the pending rise in consumer demand post COVID-19 disruption.”
Young says both shareholders requested SFF Ltd “to defer the dividend payment until the outlook for the global operating environment becomes clearer”.
“As we come through the current crisis and enter a ‘new normal’ SFF Limited’s board will gain more clarity around business impacts, thus determining dividend payment options.”
Young says the SFF Co-op board will inform its farmer shareholders of any dividend decision when it is made.
SFF CO-OP
• Net profit: $35m
• No debt
• Total shareholder equity: $304m
SFF Ltd
• Net profit: $70.7m
• Total revenue: $2.6 billion
• Dividend payment deferred at request of two shareholders - SFF Co-op and Shanghai Maling
As dairy farmers lock in plans for the upcoming mating season, a partnership between Fonterra and Silver Fern Farms has been formed with the aim of making it simpler to create additional value from calves not entering the replacement herd.
Applications for Silver Fern Farms Co-operative's next board-appointed farmer director are open.
Silver Fern Farms has tackled the ongoing war-induced shipping challenges to mideast markets by airlifting 90 tonnes of chilled New Zealand lamb and beef to the United Arab Emirates.
Silver Fern Farms has successfully produced and delivered 90 tonnes of premium chilled New Zealand lamb and beef to the United Arab Emirates via airfreight.
Silver Fern Farms has announced a major capital investment valued at over $100 million to redevelop freezing, cold storage, and automation facilities at its Finegand Site near Balclutha.
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