Focus Live Earlier: Fonterra Chairman John Monaghan, CEO Miles Hurrell and CFO Marc Rivers front the media over the latest $605m loss.
Fonterra has dropped ambitions to be a global dairy giant sourcing milk from around the world in a new business strategy which dictates "less is more".
New Zealand's biggest company, cleaning house after a disastrous FY19 financial performance, says milk value, not volume, is its new creed and New Zealandmilk is king.
The days of designing its whole business around maintaining its boast of having 30 per cent of the global dairy export market are over. Also dropped is the slogan goal of "making a difference in the lives of two billion people" around the world.
Fonterra will stop trying to be "all things to all people in all categories" and wanting to own all its ventures, says chief executive Miles Hurrell, in the job 12 months.
Fonterra CEO Miles Hurrell has signalled a major change in direction. Photo/Dean Purcell
The farmer-owned cooperative will focus on its "core" dairy ingredients business, food services and nutritional products for the paediatric, sports and active, medical and ageing sectors, he says.
It won't entirely abandon pursuit of the higher-value consumer dollar but this business area will shrink, with investments prioritised and needing to prove they will deliver sustainable value.
The company will use its scale to its advantage to cash in on its core business-to-business sales strength.
There will be more importance on partnerships, particularly in intellectual property and for research and development, while more of the protein innovation developed by its 400 world-beating scientists will be unleashed in a new focus on improving its innovation commercialisation track record.
Also high on Fonterra's reform agenda is rebuilding the trust of New Zealanders, running a conservative balance sheet and "showing respect for capital".
