Australian dairy cooperative Murray Goulburn is launching a “comprehensive” review that it said will look at “all aspects” of strategy and corporate structure.
The move follows a previous review of the group’s manufacturing network, which resulted in the closure of three facilities.
It is part of CEO Ari Mervis’s drive to improve Murray Goulburn’s performance after a profit warning and cuts to the group’s farmgate milk price last year. The moves, driven by weakness at the co-op’s ingredients and nutritionals arm, prompted the resignation of Mervis’s predecessor Gary Helou in April 2016. Mervis has been working to strengthen the co-operative dairy group’s position since joining Murray Goulburn in December.
“Today, MG announces the commencement of a comprehensive strategic review which will look at all aspects of MG’s strategy and corporate structure, including the Profit Sharing Mechanism and capital structure,” Mervis said. “I see this review as a fundamental next step to strengthen MG for the future. While the previous decisions resulting from the manufacturing footprint review, including the announcement of three site closures were necessary, I do not consider them alone to be sufficient to move the business forward.”
A further update on the strategic review is expected to be provided at the time of Murray Goulburn’s full-year results in August, the company revealed.
Shares in Murray Goulburn’s listed unit trust, launched on the Australian Securities Exchange, closed at AUD0.735, down 14.5%.