Synlait Milk today (23 March) sketched out its plans to for “recovery” after posting a half-year loss of more than NZ$80m (US$47.1m).
A month after issuing a profit warning, the New Zealand dairy and infant-formula business confirmed it had entered the red in the six months to the end of January.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
The NZ$80.6m net loss compared to a net profit of NZ$m a year earlier.
Synlait also booked a loss at the EBITDA level of NZ$35m, a swing from a positive EBITDA of NZ$63m in the opening six months of the previous financial year. Net debt jumped 88% to NZ$472.1m.
On a brighter note, revenue increased 3.5% to NZ$949m.
In its stock-exchange filings, Synlait set out a three-part plan to “stabilise, simplify and scale” the business.
The planned divestment of its North Island assets to Abbott is on-track to be completed next week.
CEO Richard Wyeth said: “The numbers we are presenting today are frustratingly disappointing. They are the result of a period where Synlait faced multiple headwinds and had little choice as to how to deal with them. They reflect a severe lack of optionality, not effort and they do not define the company’s future – although recovery will take time.”
Manufacturing issues at its Dunsandel site meant Synlait had to rebuild inventory. Synlait changed its manufacturing plan to focus on catching-up production, which led to surplus milk.
After assessing the plan to rebuild customer inventory, Synlait moved to sell the excess milk but said some of the sales “did not go to plan”, meaning the group had to pause the catch-up production to process the unsold milk into whole-milk powder.
At the end of the 2025 calendar year, the price of whole-milk powder “decreased sharply”, leading to losses for Synlait’s ingredients business.
Wyeth added: “The core takeaway from today’s result is that it does not reflect Synlait’s future. Next week’s North Island assets sale is on track to deliver a stronger and simpler Synlait. From there, we will focus on further uplifting operational stability and creating greater optionality so we can get the most out of our worldclass South Island assets.”
