22 Sep 2015

Weak milk prices cuts Synlaits' profit in half

3:49 pm on 22 September 2015

Canterbury based dairy company Synlait Milk has seen its full year profit slide 46 percent to $10.6 million, as revenue was hit by weak milk prices.

The profit was at the bottom end of guidance given by the company earlier this year, with revenue falling by a quarter to $448-million on the back of a drop in sales of its high value lactoferrin product.

Synlait has reduced its forecast payout for the current season to $5 a kilo of milk solids from $5.50 it forecast in June.

Synlait's chief executive John Penno says it has sacrificed some profit to support it suppliers.

"We add value to the milk that we collect. But our farmers are receiving a very low milk price so we've chosen to give them a little more, and we've chosen to give them stronger advance payments than we might have in a normal year, and that has bought our profit down a little as well."