News | Business
29 Apr 2017 3:58
NZCity News
NZCity CalculatorReturn to NZCity

  • Start Page
  • Personalise
  • News
  • Sport
  • Weather
  • Olympic Games
  • Shopping
  • Jobs
  • Horoscopes
  • Lotto Results
  • Photo Gallery
  • Site Gallery
  • TVNow
  • Dating
  • SearchNZ
  • NZSearch
  • Crime.co.nz
  • RugbyLeague
  • Make Home
  • About NZCity
  • Contact NZCity
  • Your Privacy
  • Advertising
  • Login
  • Join for Free

  •   Home > News > Business

    Open Country delivers record profit

    Open Country Dairy, New Zealand's second-largest milk processor, posted a record profit last year.

    21 April 2017

    Fonterra
    Fonterra

    Open Country Dairy, New Zealand's second-largest milk processor, posted a record profit last year as it sold more high-value products and strengthened its balance sheet.

    Profit soared to $62 million in the year ended September 30, 2016, from $34.4m a year earlier, according to the Auckland-based company's annual report.

    Open Country, 76 per cent owned by diversified agribusiness Talley's Group, pulled back its investment in property, plant and equipment by 44 per cent to $31.5m.

    It shored up its balance sheet by repaying $35m of loans, ahead of the $14m it paid the previous year and reducing its bank debt to $80m.

    While the company paid just 5.8 per cent more for milk, it received an extra 15 per cent from its customers as it sold more higher-value products.

    "We have got bigger," said chairman Laurie Margrain.

    "We processed more last year than we did the previous year, and we therefore got more operating leverage out of our stainless steel investment and the results should reflect that and did last year. We think it's a robust, satisfactory result.''

    Open Country has yet to pay a dividend, eschewing payouts in favour of investment for future growth.

    Founded in 2001 as a rival to dairy giant Fonterra, Open Country's first Waharoa cheese factory started production in 2004 and the company has since expanded throughout the country, building factories in Southland and Wanganui to enable it to source milk from the country's largest dairying regions.

    In its early stages, the company's focus was on producing commodity products such as whole milk powder, however in recent times it has ramped up production of higher value products.

    Open Country expects to pay its farmer suppliers around $6 per kilogram of milk solids for the current 2016/17 season. That's above the level most farmers require to produce a profit, following two years below breakeven level.


    NZN




    © 2017 NZN, NZCity


     Other Business News
     28 Apr: ACCC drops action against Fonterra
     28 Apr: Kaikoura quake to shave 0.1pc from GDP
     28 Apr: NZ business confidence still upbeat
     28 Apr: Exports rise 11pc to 2-year high in March
     28 Apr: Any more surprises in the budget?
     28 Apr: NZ wool volumes still high at auction
     28 Apr: SkyCity posts dip in third-quarter revenue
     Top Stories

    RUGBY RUGBY
    Chiefs confident replacements can step up More...


    BUSINESS BUSINESS
    ACCC drops action against Fonterra More...



     Today's News

    Soccer:
    The man who gets Sydney FC ready to wiggle 21:56

    Rugby League:
    Broncos' Milford named for Samoa Test 21:16

    Law and Order:
    Boy found safe in Newcastle after being taken from Brisbane's Lady Cilento Hospital 21:06

    Law and Order:
    Private funeral for Verity McLean 19:26

    International:
    Donald Trump's learning curve has at times been beyond vertical in first 100 days… but it's early 19:26

    Soccer:
    Sydney FC the fittest? Not so, says Lowe 18:56

    Health & Safety:
    Hemp seeds to be allowed in food in NZ 18:36

    Basketball:
    Sydney Kings chasing big men for NBL 18:06

    Rugby League:
    Nicoll-Klokstad backed to make NRL grade 17:26

    Business:
    ACCC drops action against Fonterra 16:56


     News Search






    Power Search


    © 2017 New Zealand City Ltd