Diary cooperative Fonterra is taking steps to strengthen its balance sheet as it battles falling dairy prices and a short-term spike in debt.
A change in Fonterra's balance date to include the two high milk sales months of December and January resulted in a revenue rise of 10% to $8 billion for the six months to the end of January.
The previous balance date was June to November.
When adjusted for the different sales period and exchange rate gains, revenue fell 8% because of lower prices, while costs fell 2% as it reined in its spending.
Fonterra's debt gearing rose from 57.4% to 61.5%, which it says is due to the cost of higher inventory levels, the fall in the New Zealand dollar pushing up its foreign currency debt, and an extra $700 million advance payout to farmers.
Fonterra chief executive Andrew Ferrier says the spike in debt is temporary and will fall by the end of the year.
Mr Ferrier says it has also used the $800 million raised from the public to repay short-term debt, and increased the length of its borrowings to more than four years.
Fonterra kept its milk payout at $5.10 a kilogramme of milk solids for the current season, and Mr Ferrier is confident it will remain there, barring a catastrophe in the market.
He says trading conditions are tough, but there are signs of a slowing in the rate at which demand has been falling.