Silver Ferm Farms

[Sideshow Bob]

Alliance now raising more capital from their farmer shareholders - basically making more deductions from livestock payments to increase share capital, and increasing their share requirements. They were carrying over $170m of debt at the end of their last FY, which is at the low point of the season/activity and want to use Lender funding for seasonal working capital needs only.

The Board believes the proposed changes will:

• Restore balance sheet strength
• Meet lender requirements
• Continue our drive to be New Zealand’s most efficient red meat processor
• Enable the co-operative to pursue additional value capture opportunities
• Ensure Alliance remains 100 per cent farmer-owned

Tough for farmers to have to pony up for more investment when many will be making a cash loss for the year and prices/markets are poor.

Will be a problem as some farmers may choose to send their stock elsewhere - I understand Alliance's schedules are trailing behind others so if farmers go elsewhere, makes plants more inefficient, become more uncompetitive etc.

Will be an interesting watch......

[Sideshow Bob]

Alliance capital raise

https://www.nzherald.co.nz/nz/allian...+30+April+2024

[Sideshow Bob]

First time in a few years ANZCO have (financially) outperformed SFF.

In the context of the other listed meat companies, this looks to be a very good performance and will rachet up the pressure on Alliance particularly, but also SFF. Different timing to Alliance but same as SFF. Turnover down marginally, while SFF was down $500m. However cashflow obviously hasn't been quite so good.




ANZCO Foods today announced a strong annual result for the financial year ending 31 December 2023 with a turnover of $1.83b (2022 $1.90b), and net profit before tax of $60.9m (2022 $147.7m).

ANZCO Foods Chief Executive Peter Conley paid tribute to the hard work of the company’s people and said a relentless focus on core business activities and growing returns from strategic investments were key to the company’s success.

Mr Conley noted the result was particularly pleasing given the challenging business environment the sector experienced during 2023.

“There were some positive signs for exporters during the year including the Covid recovery bringing an upswing in tourism and restaurant business, however, this was countered by the global impact of rising costs and interest rates, as well as consumers facing higher living costs.

“The recovery in China has been slower than anticipated and this coincided with difficult trading conditions for some key products in other markets. With a strong global reach, ANZCO Foods managed to effectively navigate market pricing challenges for beef and lamb at various stages of the season,” says Mr Conley.

“A significant project during the year was the depopulation and repopulation of our Five Star Beef operation, as part of New Zealand’s programme to eradicate Mycoplasma bovis. As an infected farm, Five Star Beef went through the same process as all other infected farms and this meant our high value niche products were out of the market for around six months.

“The depopulation, cleaning and repopulation had a considerable impact on our staff, customers, and suppliers working with the Five Star Beef business. We’re grateful to these affected parties for their ongoing faith in our highly valued products and continuing to work with us as we re-establish this business,” he says.

ANZCO Foods, which celebrates its 40th anniversary this year, is continuing to deliver more value from its business.

Behind ANZCO Foods’ approach is a core focus on ensuring livestock is procured to meet customer expectations. “We support key customer relationships through our on- and off-shore offices. During the year ANZCO Foods’ China office became operational, and with our other offshore offices in Japan, Australia, North America, UK and Europe, contributed to our strategy of getting closer to our customers and delivering increased revenue from our red meat products,” says Mr Conley.

“Our value-add food and healthcare businesses performed well and continued to grow their contribution to the company’s result during 2023. Our relationships with some of the world’s leading healthcare companies give us confidence that this business will continue to grow and add value to our core red meat processing business.”

ANZCO Foods continues to invest in technology and tools that underpin decision-making based on good information and this was particularly important during the uncertainty experienced during the year.

Climate change and sustainability remain a key focus for ANZCO Foods and during the past year the company reviewed and updated its three-year strategy as well as continuing to invest in lower emissions technologies to improve environmental compliance and performance.

The company has a commitment to actively support people and communities across New Zealand, particularly in rural communities through donations, sponsorships and scholarships with focuses on supporting food banks, community support services and rural schools as well as improving health and wellbeing for farming communities.

“ANZCO Foods remains committed to doing all we can to continue to deliver strong returns, ensure the industry remains stable, and contribute to a strong and vibrant agribusiness sector,” Mr Conley says.

ENDS

2022
2023
Turnover
$1.90b
$1.83b
EBITDA
$185.3m
$110.4m
Pre-tax profit
$147.7m
$60.9m
After tax
$106.6m
$44.4m
Operating cash
$133.6m
($42.0m)

[blackcap]

I wonder what Rod "Ill be chair anywhere" Hewitt will say today!

[percy]

I wonder what Rod "Ill be chair anywhere" Hewitt will say today!

I am guessing "Not A Lot".
However he may "Open Up" at tomorrow's AGM....lol.

[blackcap]

I am guessing "Not A Lot".
However he may "Open Up" at tomorrow's AGM....lol.

Ah yes, my mistake, I thought it was today for some reason LOL in deed. Thanks Percy.

[Sideshow Bob]

I am guessing "Not A Lot".
However he may "Open Up" at tomorrow's AGM....lol.

It would likely be hard to comment meaningfully, without diving into an annual report - but only get the briefest of summaries.

Certainly a good performance considering. Would think Affco (ie Talleys) would be profitable.....

[percy]

I watched SFF Ltd's,CEO Dan Boulton's presentation before the agm.
Most impressed.A very through presentation.
Challenges ahead but opportunities.
Getting the suppliers,staff and customers all on the one page.
Spending on capex will be well down,however previous high capex is proving its worth.
Even talking of being profitable this year.
Cickey Rob is still talking of being around a "bit" longer.lol.

[ordop]

Dan was organised with a thoroughly prepared speech. He didn't go off course at all and so it was a lot of corporate speak doubling down on their existing strategy,..... "Sustainability movement not going away", "We're opening high value wallets", "positioned for competitive advantage", "ready to leverage our position", "in the front row to capture this potential".

At the end of the day, I don't care whose overseas wallets they're opening, just open them = 'get sales revenues up'.

They've had some very good years with a lot of retained earnings ploughed back into the company, time for their strategy to reap the rewards. Otherwise, at some point, people are goping to say it is a failed strategy. If the NZ economy is anything like overseas economies aka cost of living and reduced living standards on aggregate, then unfortunately for SFF price points become the biggest motivating factor.

[Sideshow Bob]

https://www.odt.co.nz/rural-life/rur...irman-reflects

"One very interesting ride" is how Rob Hewett describes his lengthy tenure on the board of Silver Fern Farms.