Dairy company Synlait is anticipating a return to profitability following a prolonged period of uncertainty, during which it struggled for survival and received support from its major shareholders.
The expected recovery is attributed to growth in advanced nutrition products, strong performance in the ingredients sector, and effective cost management.
“Today’s announcement demonstrates the huge progress being made, and while we cannot take our foot off the pedal, we are pleased to announce we expect to return to profitability at our upcoming half-year result,” Synlait acting chief executive Tim Carter said.
In a statement, Synlait revealed that it expects its underlying profit for the upcoming half-year results to range between $58 million and $63 million, a major rebound from last year’s figure of $19.9 million.
This also marks a stark contrast to the $70 million loss reported in the same period last year. Carter emphasised that while progress has been made, the company must maintain its momentum to ensure continued success.
The turnaround comes after Synlait’s shareholders overwhelmingly approved measures aimed at restoring the company’s financial health. Key support was provided by major shareholders, including Bright Food from China and A2 Milk.
To further strengthen its supply chain, Synlait announced new incentives for farmers, recognising their vital role in the business.
“Farmers are an important backbone to our business. To further recognise that, we have increased our commitment to existing and new South Island suppliers with additional premiums in place for each of the following three seasons. We are confident this will secure our milk supply, which is critical to our future,” Carter stated.
Synlait is scheduled to release its 2025 half-year results on March 24, which will provide further insights into its recovery trajectory. The company’s recent announcements signal a hopeful turnaround after a stormy period, with stakeholders optimistic about its path forward.