Fonterra 2.0 on Track for 50c Dividend, Analysts Say
Sourse: dairynews.today
Leading analysts foresee a promising future for the newly restructured Fonterra, projecting strong shareholder returns and substantial dividends.
Forsyth Barr equities analysts Matt Montgomerie and Ben Crozier have provided a favorable financial forecast for the restructured Fonterra, describing it as 'strong' post-divestment of the Mainland Group. The cooperative is slated to deliver substantial fully imputed dividends of approximately 50c per year, reflecting high confidence in its focused business direction. This positive outlook is essential for the international agribusiness community, emphasizing Fonterra's core ingredients and foodservice businesses.
The financial forecasts predict a robust recovery, aiming for $1.7 billion in earnings by FY28, with the net profit after tax reaching $1 billion within three years of completing the Mainland sale. An earnings projection for FY26 ranges between 45c to 65c per share. A 46c per share dividend for FY25 is expected, alongside a $2.00 per share capital return from the divestment, with dividends further climbing to 48c in FY27 and 49c in FY28. The projections banking on prudent assumptions for global dairy economics suggest long-term structural gains, evidenced by operational efficiency rather than reliance on commodity prices.
Further, Fonterra's debt management strategy is considered conservative, with net debt anticipated to be $2 billion at the next balance date on July 31, 2026. The cooperative's refreshed structure aims for consistent value delivery, with financial stability expected to benefit farmer shareholders in the long-term.
The financial forecasts predict a robust recovery, aiming for $1.7 billion in earnings by FY28, with the net profit after tax reaching $1 billion within three years of completing the Mainland sale. An earnings projection for FY26 ranges between 45c to 65c per share. A 46c per share dividend for FY25 is expected, alongside a $2.00 per share capital return from the divestment, with dividends further climbing to 48c in FY27 and 49c in FY28. The projections banking on prudent assumptions for global dairy economics suggest long-term structural gains, evidenced by operational efficiency rather than reliance on commodity prices.
Further, Fonterra's debt management strategy is considered conservative, with net debt anticipated to be $2 billion at the next balance date on July 31, 2026. The cooperative's refreshed structure aims for consistent value delivery, with financial stability expected to benefit farmer shareholders in the long-term.
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