19 Nov 2013

Silver Fern Farms investing in future

6:36 am on 19 November 2013

Silver Fern Farms meat co-operative is continuing to invest heavily in research and market development, despite its second hefty financial loss in two years.

The country's biggest meat processor and exporter on Monday announced a net operating loss after tax of $28.6 million for the 12 months to September. That follows a $31 million loss the previous year.

The ongoing impact of a collapse in sheepmeat prices and demand at the beginning of last year is largely to blame, forcing it to carry over unsold lamb and mutton stocks and write down the value.

Chairman Eoin Garden said it remained committed to its research and marketing programmes because in the longer term, that was what would improve returns for the company and its farmer suppliers.

"This is all about investing for our future," Mr Garden said.

Meanwhile, Silver Fern Farms is expecting this year to be a better one financially.

Prices and demand for sheepmeat are improving and chief executive Keith Cooper said the factors which caused the meltdown during the past two years had largely disappeared.

"We've identified what the issues were over the last two years. It pretty roundly relates to market writedowns, inventory writedowns that have occurred," Mr Cooper said.

"Therefore, we do have a positive budget forecast in the coming year on the basis that most of the impact over the last two years were one-off events."