{"id":609789,"date":"2026-09-24T02:02:10","date_gmt":"2026-09-24T02:02:10","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/609789\/"},"modified":"2026-09-24T02:02:10","modified_gmt":"2026-09-24T02:02:10","slug":"fonterra-exceeds-earnings-target-plans-to-invest-1-billion-on-south-island-manufacturing","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/609789\/","title":{"rendered":"Fonterra exceeds earnings target, plans to invest $1 billion on South Island manufacturing"},"content":{"rendered":"The cashed-up co-op also outlined its investment plans.<\/p>\n
\u201cToday, we are announcing the co-op will invest an incremental $1b over the next three years in the South Island to accelerate and expand our protein manufacturing network and improve our environmental performance, including our impact on water and emissions,\u201d Allen said.<\/p>\n
Looking ahead, Fonterra was planning for another season of strong milk supply but said it was also well prepared for an El Ni\u00f1o weather pattern.<\/p>\n
The co-operative is forecasting milk collections for the 2026\/27 season to be just above 1.6 billion kg of milksolids and a farmgate milk price of $9.50 per kgMS with a range of $8.50-$10.50 per kgMS.<\/p>\n
Allen said the South Island projects would position the co-op to respond to changes in how people want to consume dairy, with a growing focus on sustainably produced, protein-rich and nutrient-dense foods.<\/p>\n
\u201cThey are critical to our future value growth and improve our optionality, increase our capacity and, as a result, strengthen returns for farmers and shareholders over the long term,\u201d Allen said.<\/p>\n
\u201cUsing the capital retained from the Mainland Group divestment, alongside our strong cashflow, this additional investment will help us move more milk from whole milk powder and commodities into high-value products, strengthen partnerships with existing customers, and pursue new opportunities as demand for advanced proteins continues to grow.\u201c<\/p>\n
Over the next three years, Fonterra expects total capital investment to be about $1.3b-$1.6b a year.<\/p>\n
In its result, Fonterra said total group reported operating profit was $3.4b, up from $1.7b last year, including the Mainland divestment benefit of $1.2b.<\/p>\n
Reported profit after tax was $2.6b.<\/p>\n
Fonterra\u2019s ingredients business delivered $1.293b in operating profit, supported by strong global protein demand, favourable pricing and product mix decisions.<\/p>\n
In Foodservice, Fonterra reported $547m in operating profit, driven largely by volume and pricing growth across all product categories and markets.<\/p>\n
The final farmgate milk price for the 2025\/26 season was $9.69 per kgMS.<\/p>\n
The co-op also declared a final fully imputed dividend of 33 cents per share, bringing fully imputed total dividends for the year to 73 cents per share.<\/p>\n
This included the 24 cent interim dividend and 16 cent special Mainland dividend paid in April.<\/p>\n
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