Tatua leads New Zealand dairy industry in milk payout again

Tatua's revenue in the 2024 financial year was its second highest on record. Photo / Supplied

Dairy co-operative Tatua continued to be New Zealand’s non-organic milk price leader in FY24, with a cash payout of $10.50/kg milk solids to its shareholders.

The Waikato specialist product exporter said its overall earnings equated to $12.20/kg before retentions for reinvestment. It retained $1.70/kg, equivalent to $26 million before tax, for reinvestment in the business.

Industry heavyweight Fonterra’s milk payout in FY24 was $7.83/kg. Combined with a 55c per share dividend, the multinational’s farmer-shareholders received $8.38/kg. However farmer suppliers to its organic milk programme received a milk price of $10.92/kg.

Tatua group revenue was $497m, the company’s second highest on record, though well down on FY23′s record $537m. Tatua’s milk payout last financial year was $12.30/kg from record earnings of $15.20/kg.

Earnings available for payout in FY24 were $184m.

The farmer-owned company reported a substantial drop in revenue from its bulk ingredients division which makes caseinate, whey protein concentrate and anhydrous milk fat, as a result of normalisation of FY23′s “unprecedented” high protein commodity prices and prioritisation of available milk solids to value-add production.

But combined revenue from the more specialised nutritionals, foods and flavours divisions was the highest ever, which the company said reflected its continuing focus on developing less commoditised products.

Milk supply from Tatua’s 101 shareholders was up 2.57% on the 2023 year.

Gearing, debt divided by debt plus equity, increased to 23% from the previous year’s low of 16%, reflecting the funding impact of the company’s foods plant capacity extension, now under way.

In a statement, chairman Stephen Allen and chief executive Brendhan Greaney said as usual when deciding the payout, the 110 year-old company had sought to balance the near-term needs of its shareholders’ farming businesses, and the need to keep investing for Tatua’s resilience and future prosperity.

Andrea Fox joined the Herald as a senior business journalist in 2018 and specialises in writing about the $26 billion dairy industry, agribusiness, exporting and the logistics sector and supply chains.

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