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- Release Date: 27/03/14 10:33
- Summary: HALFYR: SML: Synlait Milk posts $12.1 million half year NPAT
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SML
27/03/2014 08:33
HALFYR
REL: 0833 HRS Synlait Milk Limited (NS)
HALFYR: SML: Synlait Milk posts $12.1 million half year NPAT
Synlait Milk Chairman Graeme Milne today announced that Synlait Milk has
posted a $12.1 million net profit after tax for the first six months to 31
January 2014, an increase of $5.3 million on the $6.8 million for the same
period in 2013.
"Revenue increased to $284.9 million compared to $176.4 million for the same
period in 2013, due largely to sustained high international commodity
prices."
"Gross profit increased to $40.0 million compared to $32.8 million for the
same period in 2013, due to strong earnings from our milk powder and cream
products business. However, this was partially offset by lower than expected
earnings from our infant formula and nutritional products business due to
regulation changes in China and New Zealand's precautionary recall of WPC80,
as well as an expectation that our annual average foreign exchange rate will
be higher than applied in the determination of the farm gate milk price."
"This has resulted in the forecast FY2014 net profit after tax to be revised
from a range of $30.0 to $35.0 million to a range of $25.0 to $30.0 million,
but still ahead of the prospectus forecast of $19.8 million," says Mr Milne.
However, Synlait Milk Synlait Milk Managing Director Dr John Penno said
"overall we are pleased with the development of the business. Higher than
forecast earnings and strategic positioning continues to reinforce the
confidence we have in our future."
"With a favourable product mix and an increasing amount of product sold into
value-added applications we expect our milk powder and cream products
business to outperform our initial public offer projections in FY2014."
"Despite it being clear that we will not meet our infant formula and
nutritional volume targets for this financial year, we remain confident of
meeting our long term objectives."
"During the first half of this financial year we have made good progress with
our target first tier multinational customers. As a result we expect to be
supplying infant formula ingredients and finished products to four of our six
target customers in FY2015. This volume we expect will account for as much as
30% of our total production next season with the additional milk supply
required to meet these requirements having already been secured."
"To meet this customer demand, and with strong interest in milk supply from
farmers, we have decided to expand the scope of some of our growth
initiatives and bring forward some investment. Specifically, our second large
scale infant formula and nutritional spray drier will now have 25% greater
capacity than originally planned. The Board has also committed $6.0 million
of additional expenditure to prepare the site for an eventual fourth large
scale spray drier, and combined with the extra capacity will increase the
estimated cost of the project from $103.5 million to $135.0 million," said Dr
Penno.
"Continuing to concentrate on operational targets and the execution of our
growth initiative projects to support the development of the business is
critical. We continue to invest in people, systems, and plant and equipment
to build technical capability ahead of our market development."
The three growth initiatives under development during the six month period,
including the lactoferrin plant, drystore extension and blending and canning
plant are on track for commissioning on, or close to, their planned dates.
End CA:00248768 For:SML Type:HALFYR Time:2014-03-27 08:33:18
