Fonterra raises FY25 earnings outlook amid strong performance

Fonterra Co-operative Group Ltd (NZX:FSF) has updated its FY25 forecast, expecting earnings to land in the upper half of its 40-60 cents per share range. The announcement cited a strong first half, bolstered by robust earnings and an improved outlook for milk collections. Fonterra now forecasts a 2024/25 Farmgate Milk Price midpoint of $10.00 per kgMS and has revised milk collections upwards to 1,510 million kgMS, thanks to favourable weather conditions. CEO Miles Hurrell noted good pasture growth and strong demand across sales channels are contributing factors. The company expects to be in a position to pay a strong interim dividend, guided by its revised policy of distributing 60-80% of full-year earnings, with up to 50% at interim.