Fertiliser co-operative Ballance Agri-Nutrients says cost-cutting helped drive its trading profit up by 19.8 per cent to $92.6 million, despite last summer's drought reducing demand.
Ballance said its shareholders were in line for a record rebate and dividend of $65/tonne, along with a recommended 60-cent increase in the value of the co-operative's shares to $8.10.
A rebate averaging $60.83 per tonne and a fully imputed dividend of 10 cents per share would be paid out nearly six weeks earlier than normal to assist farmer cash flows, post-drought, it said.
"The drought may be over but the financial impacts are not, so we are fast-tracking the payment for shareholders in recognition of that so they can gain the full benefits of a good year for their co-operative as quickly as possible," chairman David Graham said in a statement.
In total, Ballance's 18,300 shareholders will receive a $65 million distribution.
Graham said the drought had affected fertiliser demand and sales volumes over the financial year, which ended on May 31.
A fire at Ballance's Kapuni urea plant in August 2011 meant the previous year's result was reduced by $20 million. Chief executive Larry Bilodeau said Kapuni coming back on stream was a factor in the improved result. "Kapuni was not the main factor but it played its role," he told APNZ.
Group sales volumes - at 1.33 million tonnes - were 7.6 per cent behind the prior year and revenue was $878 million compared to the prior year's $915 million.
Bilodeau said farmer confidence was improving. "We are seeing positive signs across all sectors with the dairy payout forecasts looking good, improvements in dry stock prices, and a lift in optimism in the cropping and horticulture sectors," he said.
Ballance sources it phosphate from North Africa, China, Vietnam and Canada but currency fluctuations did not play a big part in its result, Bilodeau said.
In the domestic fertiliser sector, Ballance is the larger player, with about 54 per cent market share. The other operator - Ravensdown - has 46 per cent.
