Synlait's Dairyworks Achieves 30x Profit Growth in Global Expansion

Synlait's Dairyworks has reported a significant transformation, achieving a 30-fold profit increase to $10.3 million over four years. The company's decision to retain Dairyworks, despite an attempted sale in 2023, has proven beneficial as the brand expands its reach globally.

Originally acquired for $112 million in 2020, Dairyworks was initially earmarked for sale during Synlait's financial crisis in 2023. However, after a year of searching for buyers without success, Synlait decided to keep the brand and focus on capital raising and shareholder loans instead.

Under Synlait's ownership, Dairyworks saw its revenue rise from $229 million in 2021 to $324.2 million by 2025. This growth was driven by an expansion into new markets, including Thailand and Vietnam, and increased distribution through Costco Australia.

CEO Tim Carter has led Dairyworks in diversifying its product range, including re-entering the butter market and expanding the cheese-and-cracker combinations. As a result, Dairyworks recorded a 27% increase in dollar sales and a 21% rise in volume over the past year, according to Circana Scan Data.

Despite high milk prices squeezing margins, Dairyworks contributed significantly to Synlait's earnings, accounting for a quarter of the company's total EBIT. Financial analysts recognize its potential for further growth, particularly in export markets, although challenges remain due to input cost pressures.

Looking forward, Dairyworks' strategic importance to Synlait is highlighted by its potential $170 million valuation. Synlait's leadership, including CEO Richard Wyeth, is keen on leveraging the brand's performance for future growth, emphasizing quality, marketing, and efficient capital deployment.