Fonterra has announced a profit of more than half a billion dollars, just days after confirming 750 jobs will be axed.
After-tax net profit increased 183% to $506 million for the year to July 31, up from $179 million last year.
Normalised ebit (earnings before interest and tax) was up 94% from $503 million to $974million, while revenue dropped 15% from $22.3 billion to $18.8 billion.
Improved second-half results were driven by a strong focus on cash and costs, chief executive Theo Spierings said in a statement.
''We focused on improving our sales mix, achieving more efficiencies, maximising our gross margins and achieving our strategic goals faster,'' he said.
Significant progress was achieved in its consumer food service strategy with which it was aiming to win market share in its eight strategic markets of New Zealand, Australia, Sri Lanka, Malaysia, Chile, China, Brazil and Indonesia.
Mr Spierings said the business review was an ongoing process across the whole organisation to identify areas where the co-operative could find more efficiencies and improve future performance.
It was targeting one-off cash savings and recurring cash savings from across the business, including procurement, operations, supply chain and sales.
Those cash savings were expected to build over the next two years and, as they were realised, would affect milk price, earnings, cashflow and the balance sheet.
Investments in New Zealand over the year represented additional capacity of 8.2 million litres and included $132 million spent on anhydrous milk fat, milk protein and reverse osmosis plants at Edendale in Southland.
With capacity now more in line with current expectations of milk growth, the co-operative would have a reduction in capital expenditure during 2016.
ANZ rural economist Con Williams said there had been a big uplift in capital expenditure in recent times and that would need to pay for itself quickly over coming years.
Fonterra Shareholders' Council chairman Duncan Coull was encouraged by the improved second-half performance, saying it was due to solid returns from the ingredients and the consumer and food service businesses.
However, the international farming business suffered from the effects of lower global milk prices and the council remained concerned with the performance of the Australian business.
''The board and management have given us an undertaking that they have a strategy in place to address this and the expectation from council is that its implementation will give effect to the turnaround required,'' Mr Coull said.
It had also been something of a transition year with regard to the co-operative's most recent capital investments.
Those had yet to provide any significant returns.
Fonterra result
Revenue: $18.8b, down 15%
Normalised ebit: $974m, up 94%
Net profit after tax: $506m, up 183%
Total sales volume: 4.3m tonnes, up 9%
