Fonterra releases first annual report

11.55am

New Zealand's biggest company, Fonterra, paid 974 of its workers over $100,000 each in its first year in business, with nine of them topping the $1 million mark.

Two payments passed the $2 million mark -- one of $2.15 million, and the other of $2.23 million, according to the company's first annual report released today.

But the big payouts include redundancy payments to staff laid off in the merger of the Dairy Board, Kiwi Co-operative Dairies, and New Zealand Dairy Group.

More than 700 employees receiving the big payments worked outside New Zealand.

Fonterra's chief executive Craig Norgate was reported to be on a salary of $1.12 million at the time of the merger.

Farmers were given that figure over a year ago, and industry observers said it was likely that Mr Norgate was now one of the two people who received a total payout of $1.4 million for the year to May 31.

Mr Norgate used to earn $870,000 in his old job running the Taranaki-based Kiwi Co-operative Dairies.

But he is now one of New Zealand's biggest wage-earners -- trailing Australian-based Lion Nathan chief executive Gordon Cairns ($2.2 million), and Telecom's Teresa Gattung, earning $1.6 million, including her share options.

The Fonterra report is being mailed to shareholders around the country from today.

Mr Norgate said the report was geared towards providing shareholders with an in-depth picture of the global businesses they now have a direct stake in.

Highlights of the report include:

*A record turnover of $13.9 billion with total assets of $11.8 million,

*A record payout to shareholders of $5.33 per kilogram of milksolids (kgms), less 3 cents per kgms for industry good activities,

*Progress ahead of schedule in realising the merger benefits promised to shareholders in the runup to formation of the company at $74 million, exceeding the 31 May target by $43 million,

*A "busy programme" to extend the international reach of the company.

Mr Norgate said the report highlighted the rapid falls in commodity prices in the second half of the year, and added that these would have a substantial impact on shareholder returns in the current year.

"It also shows the fundamental strength of the company's balance sheet, and this will stand us in good stead."

Full text:
Fonterra Annual Report 2001-2001