Synlait Milk Limited (ASX:SM1) Returns to Profitability with Enhanced Milk Supply Commitment
Financial Expectations for HY25
Synlait Milk Limited (Synlait) has announced its expectation of returning to profitability with projected EBITDA ranging between $58 million to $63 million for the six months ending 31 January 2025 (HY25). This turnaround reflects the company’s effective business recovery plan and operational enhancements.
Operational Achievements
Acting CEO Tim Carter highlighted the team’s commitment to improving productivity, stating, “The Synlait team has worked extremely hard to lift productivity and performance in the past six months.” Notable growth in the Advanced Nutrition sector and a strong performance in the Ingredients business have significantly contributed to this forecast.
Commitment to Milk Supply
To further bolster its milk supply, Synlait has announced new premiums for South Island farmers. The company will pay an additional $0.10 per kg MS for the upcoming 2025/2026, 2026/2027, and 2027/2028 seasons.
The adjustments also include amendments to milk supply agreements, ensuring that farmers receive at least the market base milk price as a guaranteed minimum. These strategic financial commitments reflect the board’s confidence in Synlait’s position within New Zealand’s dairy industry.
Synlait is set to release its HY25 result on 24 March 2025.
Motley Fool contributor Abbie Stokes has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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