Dairy co-operative Bonlac Foods today (Monday) reported a net profit after tax of AU$12.7m (US$10.06m) for the half year ending December 2004, compared with a $29.3m loss in the same period in 2003.

Sales in the half were $328m, compared with $344m in the year earlier period.

"There is confidence in the direction the company is now moving," said general manager Bruce Donnison. "The outlook is good for BFL because we are much better positioned today to capitalise on the prevailing operating environment. With costs reduced across the business and an optimised product mix, with favourable operating conditions continuing we expect that our full year position will be positive."

The company blamed the fall in sales in the half on adverse currency movements and lower milk production. "These factors were largely offset by higher international commodity prices and our access to Fonterra's global strength in the ingredients markets," it said. The company is 50% owned by New Zealand dairy co-operative Fonterra.