What steps are Silver Fern Farms taking to stay competitive and resilient in the face of domestic and global challenges?
Like our farmers, Silver Fern Farms is feeling the impact of global market conditions compounded by inflationary pressures on our cost base.
We’re acutely aware of the financial pressure at the farm gate, and we know we have a role to create more value for our farmers.
While there’s no doubt that times are challenging, it’s also an important time to learn, refine, adapt and grow as an organisation.
In response to the current headwinds we are facing, my focus has been to prioritise cash, then protect our strategy, and then manage profit expectations – something all farmers will be familiar with.
We know the importance of maintaining a healthy balance sheet, and to help preserve that we have been actively leaning into cost avoidance and cost out initiatives.
Since the last quarter of 2023, we have targeted close to $80 million in cost savings and cost avoidance from across the business. It’s been critical to act swiftly when we are faced with increased costs in a sector with declining revenue.
However, we also know the current environment we are in is just a moment in time. We’re continually striking a careful balance between removing cost, but also not diminishing our investment to the point where we will not see meaningful or efficient returns on it.
Despite the market conditions, we’ve still invested in the business. Last year, we invested $106.8 million across the business – with around $70 million of that across our sites. When the markets do begin to recover, this investment will allow us to rebound faster.
We’ve got a relentless focus on outcomes that generate true incremental value (both financial and non-financial) for Silver Fern Farms and our Farmers. We’re also driving greater commercial rigour and discipline to both our strategic and operational execution.
Everyone in the business is chasing the one percent gains that can be achieved. We know a collective of one percent gains can make a big difference to our bottom line, and we are getting great results across the organisation.
Most importantly, we haven’t lost sight of the bigger picture. We’re aligned behind our purpose and strategy, and we’re optimistic for the future of Silver Fern Farms, our producers and our position on the global stage.
The direction and our ambition for the business has not diminished, and we’ll come through these times stronger, sharper and more determined than ever.
Dan Boulton
Chief Executive
Silver Fern Farms
