Farmlands Co-operative reports financial statements for the year ended 30th June 2019

On Thursday 31st October 2019, Farmlands Co-operative announced its annual result to shareholders.

Farmlands Chairman Lachie Johnstone says the rural supplies and services co-operative achieved another positive result for its shareholders against the backdrop of a subdued marketplace and challenging on-farm conditions, particularly in spring 2018.

“Farming uncertainty has dominated short-term decision-making on farms across the country,” says Lachie.

“This has inevitably had an influence on our performance. However, our 2019 result represents a further step along the path of building resilience in our business.”

Farmlands’ net profit before tax and rebates for the latest year is $8.4 million on revenue of $1.1 billion. Total revenue has increased by 3.2 percent on the previous year.

While expressing satisfaction at Farmlands’ continuing profitability, Lachie says that the Board of Directors has decided not to distribute an additional Bonus Rebate to shareholders in 2019.

“We came to this decision extremely reluctantly. However, Farmlands is navigating its way through a big and very demanding change programme, Braveheart. This programme is designed to future-proof Farmlands for the next generation and beyond.

“The Board believes the decision not to pay a Bonus Rebate this year is prudent in light of the significant cash commitment to the Braveheart project and its ongoing impact on the business balance sheet and cash flow, compounded by sector uncertainty. Retaining cash at this time supports managing the co-operative’s seasonal liquidity requirements as well as funding the completion of the Braveheart programme.”

Farmlands Chief Executive Peter Reidie says the co-operative is pleased to post another year of growth and profitability for Farmlands shareholders. “We’ve succeeded in delivering $86.1 million in rebates to shareholders on their Farmlands Card activity and at point of sale and have delivered $6.7 million worth of Choices Rewards Points.”

Peter says that Farmlands is also positioning itself as the sector leader in the area of health and safety, training and environmental stewardship — a function of the co-operative’s commitment ‘to put our people first’.

“Last year, with our FarmIQ partners, we launched SafeFarm. Earlier this year we launched our second safety app, SafeVisit, free not just to shareholders but all New Zealanders. SafeVisit provides visitors a way of scheduling visits and completing a full site induction in advance using the app,” says Peter.

“Our development of training programmes and our focus on environmental stewardship have been recognised across the Asia-Pacific, notably with our Farmlands Darfield store being lauded at the Environmental Respect Awards earlier this year.”

At the conclusion of the Annual General Meeting in November, Lachie Johnstone will be stepping down as Chairman, after serving nearly 19 years on the Board. Rob Hewett will be replacing Lachie as the new Chair.

“It has been my privilege to have watched Farmlands grow its footprint nationally. It’s now a nationwide co-operative, providing all the products and services our 70,000 shareholders need to succeed in business. We’ve created a business that has an entire value structure built on giving back to those that trust us to help them with their livelihoods,” says Lachie.

“I’m handing over to Rob Hewett confident that Farmlands is in good heart. Through our ‘To the Core’ programme, in conjunction with Silver Fern Farms, we’ve made a major effort to foster the next generation of rural governance. This initiative, in tandem with our Braveheart business-wide transformation programme, means our co-operative is positioning dynamically for the future – a future that we see is full of promise.”

After this year’s AGM on the 21st November 2019, to be held at the Gallagher Building in Mystery Creek, Farmlands will also farewell Director Murray Donald.

The 2019 Farmlands Annual Report is available to download by visiting www.farmlands.co.nz/annualreport