NZ lamb, sheep, beef and deer co-operative to invest $54 million

Sheep Central, October 9, 2017

LEADING New Zealand food company Alliance Group has announced it is investing $54 million in capital expenditure in the co-operative over the next year as its annual road-show is held across the country.

Alliance Group chief executive David Surveyor said the success of the business strategy meant the co-operative was in a position to re-invest in continuing to build the company’s operational performance.

In addition to a pool payment, the company will have a bonus share issue and reward farmer shareholders by increasing their shareholding in the co-operative. The level will be based upon the supply of lambs, sheep, cattle, calves and deer during the 2017/18 season.

“Alliance is now a much fitter co-operative as a result of our focus on lifting efficiency and improving sales and marketing.

“We are making good progress against our key measures with a stronger balance sheet, improved profitability and better livestock pricing for farmers,” Mr Surveyor said.

“We’re working hard to ensure our improvements are sustainable through further investment, growing our value add and building our organisational capability.”

Mr Surveyor said as part of the co-operative’s strategy program, Alliance Group has made significant investments in technology and operational improvements, lifting processing and productivity across its plants and incorporating best practice from around the world.

This included new primal cutters and middles technology at the Dannevirke plant, a range of investments to lift the recovery of “5th quarter” products, improving chiller performance, investing in the Pukeuri plant beef chain and packaging innovations.

The co-operative expected to make further gains as a result of its recent acquisition of Singapore-based marketing and sales company Goldkiwi Asia, which will be known as Alliance Asia.

Mr Surveyor said the co-operative was doing a better job of rewarding loyal shareholders.

“More frequent minimum price contracts are helping provide our farmers with certainty.

“However, there is still some work to do in this area and our prime beef performance needs to be lifted.”

Alliance is also continuing to maximise the schedule price to farmers, he said.

The company said Alliance director James Ogden will retire at the end of his term of appointment on November 30 and be replaced by Peter Schuyt. Mr Schuyt is an experienced independent director on a range of New Zealand businesses including Tatua Co-Operative Dairy Company, TSB Bank Ltd and Foodstuffs North Island Ltd. He has also held senior executive roles at the New Zealand Dairy Board, Fonterra and the NZ Post Group. Mr Schuyt is a Chartered Fellow of the New Zealand Institute of Directors. The annual roadshow program, covering the North and South Islands, began in Dannevirke on October 2 and finishes in Fortrose on October 19.

Source: Alliance Group.



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