Landcorp 1H earnings soar on rising dairy income, chairman Baylis to go
By Paul McBeth
Feb. 4 (BusinessDesk) - Landcorp Farming, which manages 137 farms, more than tripled first-half profit as record milk
prices drove up dairy income and said earnings will hold up for the rest of the year. Separately, chairman Bill Baylis
announced plans to resign from the board.
Operating profit rose to $12.2 million in the six months ended Dec. 31 from $2.5 million a year earlier, on a 27 percent
gain in revenue to $119.4 million, the state-owned farmer said in a statement last week. Landcorp expects to report
full-year operating profit of about $35 million, the top end of its previous forecast range of between $30 million and
$35 million, and almost three-times its 2013 earnings of $13 million.
Dairying income jumped 58 percent to $74.8 million, with a forecast payout above $8 per kilogram of milksolids, and
increased production from the sharemilking arrangement with Shanghai Pengxin to run the former Crafar farms.
The SOE’s expenses rose 18 percent to $103.8 million in the period with higher costs associated with the Pengxin joint
venture
Landcorp’s net profit climbed to $109.3 million from $24.9 million a year earlier on significant gains in the value of
livestock during the period.
Landcorp’s livestock revenue fell 8.1 percent in the first half due to smaller livestock numbers after last year’s
drought in the North Island, when farmers were forced to cull stock. The SOE’s lambing rate, the number of lambs born
per ewe, fell to 139.5 percent from a record 145 percent a year earlier.
In a separate statement, chairman Bill Baylis said he would resign from the board at the end of April, when Landcorp
will have completed a strategic review of its business. Baylis joined the board in November 2009, and assumed the chair
in May 2012, replacing former Agriculture Minister Jim Sutton.
(BusinessDesk)