FSF - Fonterra

[winner69]

NBR says ‘ It is unclear whether Beaumont resigned or was fired.’

[Traderx]

Can anyone explain to me in simple terms why there is such a large difference between the price of Farmers shares (FCG) and the units (FSF)?

The Farmers shares apprear on the surface to be ultra cheap on relative basis? Are farmers under such cashflow pressure that they cannot close out this arbitrage? Surely a Farmer could arrange a short position in FSF and go long FCG?

Farmers appear to be now able to hold up to 4X their milk equivlaent shares - i.e they can take a substantial outright position on the shares

[Sophie]

My understanding is that the shares can't be exchanged into units as easily as they used to. The gap between prices started around the time the proposed cap on the Fund was announced (April 2021-ish?) - comparing the two over the last few years makes for a neat graph showing the difference between when there is an arbitrage opportunity and when there isn't.

[Sideshow Bob]

Good news for NZ Inc.....

https://www.nzx.com/announcements/425975

FY24 forecast Farmgate Milk Price lifts
Fonterra Co-operative Group Limited has today increased its 2023/24 season forecast Farmgate Milk Price, with the midpoint lifting by 30 cents to $7.80 per kgMS, up from $7.50 per kgMS.
The forecast range for the season increases to $7.30-$8.30 per kgMS, up from $7.00 - $8.00 per kgMS.

[Sideshow Bob]

https://www.nzx.com/announcements/428329

Strong profit and dividend for FY24 interim results
• Reported profit after tax: NZ $674 million, up 23%
• Continuing operations EBIT: NZ $986 million, up 14%
• Earnings per share: 40 cents per share
• Return on capital: 13.4%, up from 8.6%
• Interim dividend: 15 cents per share, up from 10 cents per share
• Maintained forecast FY24 continuing operations earnings range of 50-65 cents per share
• Forecast Farmgate Milk Price range narrows: NZ$7.50 - $8.10 per kgMS
• Forecast milk collections: 1,465 million kgMS, down 1%

[mshierlaw]

https://www.nzx.com/announcements/428329

Strong profit and dividend for FY24 interim results
• Reported profit after tax: NZ $674 million, up 23%
• Continuing operations EBIT: NZ $986 million, up 14%
• Earnings per share: 40 cents per share
• Return on capital: 13.4%, up from 8.6%
• Interim dividend: 15 cents per share, up from 10 cents per share
• Maintained forecast FY24 continuing operations earnings range of 50-65 cents per share
• Forecast Farmgate Milk Price range narrows: NZ$7.50 - $8.10 per kgMS
• Forecast milk collections: 1,465 million kgMS, down 1%

Great result, good to see good interim dividend with promise of another bumper final dividend.

Divided policy is 40 to 60% of NPAT paid in dividends with no more than 40% paid in interim.

This leads to final dividend of more than 22.5 cents. That's a gross yield of 10.47% on todays share price.

[nztx]

No tax credit attachments tossed out from under the covers with spitouts from this curious beastie - are there ?

Maybe 'after the tax add-ons & takeaways' assessment of what coin leftover lands in the pocket might be a better comparison basis ?

[whatsup]

Can someone please post the news article about bird flu effecting the dairy industry in the U S ?

[Sideshow Bob]

Can someone please post the news article about bird flu effecting the dairy industry in the U S ?

Like this one?? https://hub.jhu.edu/2024/04/15/qa-avian-flu-in-cows/

[whatsup]

Like this one?? https://hub.jhu.edu/2024/04/15/qa-avian-flu-in-cows/

Bob, thank you, interesting reading.