NZ's largest rural supply store Farmlands records more losses

Challenging financial times for farmers have resulted in New Zealand's largest rural supply store Farmlands making a loss.

The co-op has posted a $14.3 million net loss after tax for the year ended June 2024 - this follows a loss in the previous financial year of $679,000 after tax.

The cooperative said the result was disappointing after a very hard year of effort.

Farmlands chairperson Rob Hewett said the loss results from lower revenue (down $68.2m) reflecting farmer and grower spending and was exacerbated by a one-off accounting adjustment to previously-recognised tax losses of $12.3m.

"We know that when our farmers and growers have a tough time, we are likely to feel the impact. It's been one of those years. We recognised this early and adjusted our short-term strategy quickly," he said.

He said if the tax adjustments were removed the net loss would have been $2m and slightly below the previous year.

Hewett said the Co-op paid $92m in shareholder rebates which demonstrates the underlying strength of the business and its ability to support farmers and growers through these tough times.

Farmland chief executive Tanya Houghton said better pricing on rural supplies put an additional $6.9m back in the hands of Kiwi farmers and growers.

"This has been made possible through efficiencies gained from our supply chain transformation, careful inventory management, supplier negotiations and tight operational cost controls," she said.

Houghton added that the Co-op was stronger than 2-3 years ago with examples of growing underlying strength including an improved cash position year-on-year, acquisitions like SealesWinslow and new partnerships such as Fern Energy.

In a release Farmlands said it now has significantly improved stock availability, and the Co-op's first range of direct-sourced products sold rapidly at competitive prices and clearance stock exceeded sales expectations, reducing planned write-offs.

A new Horticulture Hub in Hastings demonstrates Farmlands' commitment to better serving specific regional horticulture needs, providing tailored support and expertise to local growers.

Hewett said while it has been a challenging year the business strategy is working.

"Farmlands is making the bold moves and developing the innovations that'll see us boosting the productivity and profitability of Kiwi farmers for at least another 60 years," Hewett said.

Key numbers:

• $2.5b in Turnover
• $740.3m in Revenue
• $20.4m in Operating EBITDA
• $14.3m Net Loss After Tax
• $21.9m in Operating Cashflow
• $92m in Total Shareholder Rebates
• $44.1m in Rural Supplies Rebates

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