Fonterra profits fall 16pc

Fonterra says its net profit dropped by 16 per cent to $183 million in the first half of the year to January 31, reflecting tough conditions in the dairy market and problems in managing inventory made in the previous fincial year.

Fonterra stuck with its farmgate milk price forecast of $4.70 a kg of milk solids but contrary to expectations cut its forecast dividend payout for the year to a range of 20c to 30c from a previous range of 25c to 35c a share, taking the total forecast payout for the year to $4.90 to $5.00 per kg.

For the six months, Fonterra declared a 10c per share dividend, up from 5c for the same period in the previous year.

Revenue over the half year dropped by 14 per cent to $9.7 billion.

By Jamie Gray, NZME. News Service business reporter

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