Dry weather and dairy setbacks squeeze Landcorp's forecast earnings by $10 million.
New Zealand's biggest farmer, state-owned enterprise Landcorp has announced a $10 million reduction in its forecast earnings for the 2019 financial year.
A notice on Treasury's website says Landcorp now expects full-year earnings before interest, tax, depreciation and revaluations (EBITDAR) of between $27m and $32m, compared to the previous forecast
range of between $37m-$42m for the year ending June 30.
The dairy and red meat farming company attributed the forecast fall to a string of lower than expected returns from its various businesses.
The reasons included extremely dry conditions lowering milk production in the final months of the season, particularly on Landcorp's central North Island farms which produce about 40 per cent of its total milk production.
A reduction in forecast milk price from Westland Milk Products from $6-$6.20/kg milksolids to $5.80-$6 and uncertainty over the level of a dividend from Fonterra were also cited, along with lower than forecast dairy beef prices.
