New Zealand rural supplies co-operative Farmlands has posted $17.1 million group net profit before tax and rebates for the 2022 financial year.
The company announced its results at its annual general meeting held at its new flagship Ashburton store last week.
The performance is up 34% on the previous year and has resulted in Farmlands planning to return an $11.9m gross shareholder distribution. This will mean $8.6m is being returned to shareholders after tax.
The distribution will be the first return to shareholders delivered in four years. It is almost double the gross distribution of $6.2m provided in 2018.
“Farmlands is returning to a position of financial strength – during a time when New Zealand agriculture is faced with a lot of rapid disruption,” chair Rob Hewett says.
“We have a clear plan on how we will deliver greater value to our shareholders over the long-term. We are focused on our core role of providing critical inputs to New Zealand farmers and growers and embracing growing new lifestyle customers groups connected to the land.”
The group result includes the Farmlands fuel business which became part of a new joint venture, Fern Energy shortly after the end of the financial year.
Group revenue was up 15% to $1.25 billion and total group turnover exceeded $3b for the first time.
Group earnings before interest, taxes, depreciation, and amortisation (EBITDA) was $51m – an increase of 9%.
Chief executive Tanya Houghton says the result was built on a combination of good gross profit growth and tight cost controls in a challenging operating environment.
“We looked at how we could improve the way we did business and implemented change quickly to deliver this year.
“We are now focused on medium and long-term growth, ensuring Farmlands is sustainable and delivering value to New Zealand agriculture well into the future,” Houghton says.
“As we continue to manage industry uncertainty, we do not expect straight line growth in distributions – there will be some bumps. As our business improvements start to have positive impact over the next two to three years, we expect to see our profitability and shareholder returns increase,” she says.
New Ashburton store
Farmlands opened its new flagship store in Ashburton on October 28 – its first new store in seven years.
The new concept store has been specifically designed to meet the needs of farmer and grower customers, and the expanding lifestyle property owner community in and around Ashburton.
It provides an enhanced retail experience compared to other Farmlands stores, with a community space, a new FeedBarn nutrition concept and even a pet wash.
