5 Dec 2012

Synlait announces $6.3 million profit

3:06 pm on 5 December 2012

Synlait has posted a $6.3 million profit after tax for the year ending in July.

The profit is the first in the Canterbury milk nutrition company's four years of operation.

The company had turnover of $377 million - an increase of $78 million on the year before - on the back of strong growth in its milk powder ingredients business.

It paid its farmer suppliers an average of $6.22 a kilogram of milk solids for the past season, the highest South Island milk price for the season.

The company has also contracted 40 more farms to supply it milk, increasing the volume of milk from 343 million litres in 2011 to 498 million litres this year.

Chief executive John Penno says the company is very happy to have been able to achieve a solid profit result while also paying its suppliers a competitive milk price.

Dr Penno says while the long-term prospects for Synlait Milk are excellent, in the short-term the strong New Zealand will to erode its farmers' returns.