Silver Ferm Farms

[percy]

Happy Dividend Day!!

Its here...lol.

[stoploss]

Its here...lol.

Thanks Percy, extra scoop of chips tonight.

[iceman]

A great result for Alliance https://www.alliance.co.nz/news/2022...annual-result/

"New Zealand’s only 100 per cent farmer-owned major red meat co-operative Alliance Group today announced a record profit before provisions, distribution and tax of $117.2 million for the year ending 30 September 2022.

The profit result, which is a 186 per cent increase on the previous year, is based on a record turnover of $2.2 billion. The co-operative will be making an $11.3m profit distribution to its farmer shareholders, and in addition, a $10 million bonus share issue of one share per qualifying stock unit."

[Sideshow Bob]

A great result for Alliance https://www.alliance.co.nz/news/2022...annual-result/

"New Zealand’s only 100 per cent farmer-owned major red meat co-operative Alliance Group today announced a record profit before provisions, distribution and tax of $117.2 million for the year ending 30 September 2022.

The profit result, which is a 186 per cent increase on the previous year, is based on a record turnover of $2.2 billion. The co-operative will be making an $11.3m profit distribution to its farmer shareholders, and in addition, a $10 million bonus share issue of one share per qualifying stock unit."

Good to see you back from the pub Iceman.....

Certainly a relatively solid result from Alliance, who have been lagging SFF in recent years and by some margin. Of late have been about 2/3 the turnover of SFF, with more exposure to lamb, less to beef. About a 5.3% margin.

Lamb processors have had a golden run, however looks like this is coming to a shuddering halt (Alliance are a bigger lamb processor than SFF). Alot of stock in China, and suffering from the zero-Covid policy where a higher proportion of lamb is consumed outside the home. The prices paid by the Chinese for flaps, forequarters and a few other bits and pieces are well above any other markets and amount to about half the carcase. Add to that global inflation, recession fears in Europe etc, and expect schedules to come back fairly fast. Perhaps David Surveyor (Alliance CEO) saw this and resigned on a high/record profit?? The SFF market report certainly has graphs of these products that are heading south fast.

One thing that has changed for lamb processors is the carcase market has gone overnight. Processors had been selling whole carcases into China at really good money, rather than deconstructing it and selling all of the pieces. That market has now gone. The industry has more slaughter capacity than boning capacity, so that will be a handbrake - and boning takes more labour that they don't have.

Back to SFF, end of FY22 might be a little tougher, but they could well crest the $3b+ turnover for the first time. If Alliance can make $117m EBITDA (still go for the highest number), then would expect SFF to be even more meatier than last year. Heavily reliant on beef margins with roughly 3x the beef of Alliance. Current FX levels are helping in the meantime.

[iceman]

Thanks for a good informative post SB

[Sideshow Bob]

111.jpg

Source: SFF Market Report ex AgriHQ.

A strong pullback on market returns on grinding beef and a range of lamb cuts - even with the currency assisting the NZD returns.

Processors have had a purple patch with markets and "a rising tide lifts all boats" - as evidenced by what limited industry results are available publicly. The true test will be whether companies can maintain profitability at a good level regardless on market conditions.

This will be a test for SFF that the capital reinvested into the business pays off. The positive aspect is that SFF now compared to the old SFF has a much stronger balance sheet, from the 50% sale and also retained profits.

[percy]

https://sendy.tarawera.co.nz/l/J6oLV...muY4BeCb50JwCQ

[Sideshow Bob]

https://sendy.tarawera.co.nz/l/J6oLV...muY4BeCb50JwCQ

Government still trying to kill off one of the mainstays of the NZ economy. Would rather see a monoculture of pine trees, for which overseas owners use the carbon credits so they can keep polluting - to maintain their virtue signalling and political correctness.

Meanwhile promoting tourism, where long-haul air travel remains inherently unsustainable. But that's OK because no one "owns" those emissions.

[Sideshow Bob]

https://www.farmersweekly.co.nz/govt...4v7KJj3_P2MHTw

The primary sector is chalking up a small victory after the government agreed to amend the Emissions Trading Scheme to recognise more classes of carbon-sequestering vegetation.

[percy]

https://www.scoop.co.nz/stories/BU22...in-october.htm