Poor farmer understanding of the way Dairy Equity (DEL) works has hampered its first nine months of existence, the company says.
DEL has reported a $548,000 after- tax profit for its interim nine months to February. Turnover was $1.7 million.
DEL provides the public with equity exposure toFonterra. DEL listed on the sharemarket last September after an initial public offering of $1 a share.
Chairman Peter Jensen said the company's first nine months had been characterised by uncertainty created by Fonterra's significant payout and capital structure announcements.
During the period, DEL invested $4.23 million in SWAP agreements. SWAPs are agreements which DEL enters into with Fonterra shareholders to buy Fair Value Shares, shares for each kilogram of milk solids they supply to Fonterra. Investment had "picked up significantly" since the end of the period, with $10.35 million more in agreements.
