New Zealand milk processor Fonterra has today (Thursday, March 16) announced a half-year profit after tax of NZ$546 million (€279 million), which is up 50% on the same period last year.

The co-op’s 2023 interim results for the six months up to January confirmed earnings per share (EPS) of 33 cents and a decision to pay an interim dividend of 10 cents per share.

Fonterra has upgraded its full year forecasted normalised earnings from 50-70 cents per share to 55-75 cents per share.

The co-op is planning to return NZ$800 million to shareholders following the sale of its Soprole business in Chile.

Fonterra previously confirmed that following a review it will retain full ownership of its operations in Australia.

In February, the processor reduced its forecasts for both farmgate milk price and milk collections for the 2022/2023 season.

The report confirms a forecasted farmgate milk price range of $8.20 – $8.80/kg of milk solids, along with a 1% drop in milk collections.


Fonterra chief executive, Miles Hurrell said that the results show the co-op is performing well against the backdrop of ongoing market volatility.

“Our co-op’s scale and diversification across channels and markets has enabled us to navigate through disruption and make the most of favourable market conditions in a number of areas.

“While milk powder prices have softened recently, impacting our forecast farmgate milk price range, protein prices have been high, and this is reflected in the lift in earnings we’re reporting today.

“Our improved earnings and strong balance sheet have enabled us to pay an interim dividend of 10 cents per share which is positive news for our farmer owners and unit holders. We also expect to be able to pay a strong full year dividend, in addition to our proposed capital return,” he said.

Hurrell said the co-op will continue to watch changes in the dairy market closely.

“The outlook for dairy remains positive with high demand for New Zealand’s quality, sustainable dairy nutrition, and global milk supply likely to continue be constrained.”

“We have a clear strategy and are well-positioned to take advantage of this demand,” he said.

Hurrell noted that severe storms and flooding across the North Island in January and February temporarily delayed some product getting onto ships.

Dairy industry

In terms of the climate challenges facing the dairy industry, Fonterra is currently running 18 methane reduction projects and 30 trials of “potential solutions”.

“We’re also making progress in our work to transition our manufacturing sites out of coal by 2037.

“At our Waitoa site we’re converting one of our boilers to wood biomass. Scheduled to be operating later this year, the new boiler will reduce the site’s annual emissions by 48,000 tonnes of CO2e, the equivalent of taking 20,000 cars off New Zealand’s roads,” Hurrell said.