The result was a major turnaround on the previous year’s $189.3m profit and $3.3 billion revenue. Ebitda, including share of associate earnings, fell from $301.3m to $16.4m.
Silver Fern Farms Co-operative, which jointly owns Silver Fern Farms Ltd with Chinese-owned Shanghai Maling Aquarius, posted a net loss after tax of $10.7m.
Silver Fern Farms chairman Rob Hewett said depressed consumer confidence across the company’s key markets had put pressure on its customers, the operating company and, ultimately, returns for farmers.
The impact of one-off events, including Cyclone Gabrielle which caused damage and disrupted operations at the Dargaville and Pacific (Hawke’s Bay) processing sites, had also been felt.
Silver Fern Farms continued to manage costs and reprioritise large elements of its proposed spend until there was greater confidence in the market’s recovery, Mr Hewett said.
It was disappointing not to distribute any dividends but he was confident in the company’s ability to recover when market conditions became more favourable.
New chief executive Dan Boulton said the challenging market conditions were expected to persist well into the current year. While a recovery in beef pricing in the shorter term was expected due to increased demand out of the United States, sheepmeats were expected to take longer. Venison returns had been less impacted.
Mr Boulton said "everyone" was finding it tough, not just Silver Fern Farms and its farmers but throughout the supply chain.
Pleasingly, medium to long-term global protein demand continued to grow and growth of "nature positive" farming was only going to grow further. Work Silver Fern Farms was doing in that space was resonating with more high-end customers. But he was also acutely aware that, during a downturn, it was harder for farmers to see hope in that future, he said.
He was confident the bottom of the sheepmeat market had been reached and there were "glimmers" of price lifts in markets, although not significant enough to change the outlook at the farm gate.
Mr Boulton said his predecessor, Simon Limmer, had "left a great legacy" and, when it came to him getting his feet under the desk, being an internal appointment helped.
He was previously chief supply chain officer and understanding the nature of a large business, operating in a complex environment, and even understanding New Zealand farming systems, allowed him to "hit the ground running".
It had been an "absolute privilege" to step into the role, he said.
Silver Fern Farms result
| For the 12 months to December 31, 2023, compared with the 2022 year.— | ||
|---|---|---|
| 2023 | 2022 | |
| Revenue | $2780.8m | $3277.8m |
| Ebitda, incl share of associate earnings | $16.4m | $301.3m |
| Net profit before tax | -$36.4m | $262.6m |
| Net profit after tax | -$24.4m | $189.3m |
| Capital expenditure | $106.8m | $96.0m |
| Dividend | None paid | $76.9m |
