26 Aug 2009

Uruguay farm development company reports loss

12:18 pm on 26 August 2009

New Zealand Farming Systems Uruguay has made a full year loss as dairy prices bottomed and milk production there was hit by the worst drought in 30 years.

The company has reported a loss of $15.6 million for the June year, almost double a loss of $8.8 million the previous year.

The company says it cut costs where possible and scaled back farm development to conserve cash. It also raised extra funds through a bond issue.

PGG Wrightson financial services general manager Michael Thomas says the company expects to double milk production over the coming year, but the price of milk is holding it hostage to losses.

He says New Zealand Farming Systems Uruguay plans to sell land and launch another bond issue to fund its ongoing farm development.