Addressing the annual meeting in Dunedin yesterday, chairman Rob Hewett said a broad review was needed to ensure the constitution was the ‘‘best it can be''.
The company was awaiting regulatory approval from the New Zealand Overseas Investment Office and Chinese authorities for a joint venture with Shanghai Maling, which will inject $261million into the company.
Various topics to consider in the review included share classes, voting rights, distribution policies and director make-up.
The process would involve the board, external advisers and input from a representative group of shareholders.
It was expected any recommendations would be presented to shareholders through a national roadshow, likely before June. Any changes to the constitution would require a 75% vote, Mr Hewett said.
He described it as a significant year of change and achievement for the co-operative. Substantial progress was made on key goals of making significant progress towards zero harm in health and safety, achieving a material and sustainable improvement in profitability, growing its value-added strategy, and creating a sustainable financial position.
Operating profit of $86.9million for the year ended September was up 28% on last year's result.
Reported profit was $24.9million, up from $0.5million, while net debt was down from $288.6million to $120.9million.
While results were much improved, there was still plenty of progress to make to achieve returns that reflected the amount of capital invested in the business, he said.
The capital-raising process culminated with a vote in October, when shareholders overwhelmingly voted in favour of selling a 50% stake to Shanghai Maling.
Mr Hewett was confident the Overseas Investment Office would view the proposal favourably because it was ‘‘good for New Zealand'' and good for the regions where the company's 7000 employees worked.
It was hoped to start the partnership in the second quarter of the new calendar year and, provided it met regulatory approval, Silver Fern Farms was ‘‘heading into a very exciting period''.
John Shrimpton, from Glenthorne Station, said the company was in a significantly better financial position than was painted in a report by independent adviser Grant Samuels.
That report said there was substantial risk the co-operative would be placed in receivership if the joint venture did not go ahead.
But its financial position made it difficult to accept the company was ‘‘at death's door'' in September, Mr Shrimpton said.
Mr Hewett said the company was still largely in a commodity business and it was ‘‘one year away from a ... [very poor] result''.
While its equity ratio looked robust this year, it wanted to improve on that. Right now, that would ‘‘dissolve'' if it had a bad year.‘‘We're too close to the edge, that's why we need more equity in the business,'' he said.
The partnership with Shanghai Maling was a ‘‘good one'' and he believed no other red meat company in the world would have that sort of preferential access into China.
Chief executive Dean Hamilton said it took the company ‘‘to another level'' and fixed its capital structure ‘‘once and for all''.
Goals for 2015-16 included delivering another improvement in financial performance, building towards operational excellence, deepening confidence and engagement with employees and suppliers, and completing the Shanghai Maling transaction and ‘‘hit the ground running''.
There was also a desire to drive more of its business into higher-margin chilled and value-added, Mr Hamilton said.
While there had been reasonable conditions in the North Island, there were tough conditions in the South Island.
Lamb kill was up 5% on last year and mutton up 10% in response to current and expected dry conditions. Farmers were planning now and looking to get stock off farms earlier.
There would be first quarter challenges, but he was optimistic for the full year.
Peter Hall expressed concern about the payment to former chief executive Keith Cooper, who resigned in October last year, and was paid between $1.84million and $1.85million in the past financial year.
That included a combination of base salary for a period, a short-term incentive related to the prior year, a retention incentive that related to prior and future years, annual and long-service leave, and a payment that reflected his significant contribution to the company, the annual report said.
