Fonterra reports half-year profit of $750 million after tax

Dairy giant Fonterra has released its interim results for the first half of FY26, reporting a strong net profit of $750 million after tax, up from $729 million.

Revenue had risen to $13.9 billion for the half, while operating profit increased to $1.23 billion.

The co-op also lifted its forecast Farmgate Milk Price midpoint to $9.70 per kilogram of milk solids, up from $9.50, with the range now sitting between $9.40 and $10.00.

An interim dividend of 24 cents per share for farmer shareholders and unit holders was announced, along with a 16 cent special dividend linked to its Mainland business.

Outgoing chief executive Miles Hurrell said the results reflected continued momentum across the co-operative's operations, driven by strong demand and improved margins.

"The underlying performance of Fonterra’s continuing business is stable, allowing the Co-op to return all earnings associated with the Mainland Group business and lift our forecasts for the remainder of the year ahead," Hurrell said.

"Demand for our products is strong, and we're focused on our plan to maximise both the Farmgate Milk Price and earnings."

The co-op reported a return on capital over the last 12 months of 11.2%, up from 10.4% this time last year, and earnings per share of 51 cents, up from 47 cents.

Fonterra also increased its full-year earnings forecast to between 50 and 65 cents per share.

Hurrell said strong milk collections, particularly in the South Island, had also supported performance, despite weather-related challenges during the season.

He said the changes reflected improvement in global commodity prices but noted the ongoing conflict in the Middle East was creating potential volatility in supply chains and commodity prices.

"The conflict is a complex and dynamic situation that is changing daily, but we are confident that we’re on the right track to get product to customers," Hurrell said.

"Our business is designed to manage volatility."

The result comes after Hurrell announced he was stepping down as chief executive last week, and as Fonterra progresses the unconditional $4.22 billion sale of its global consumer brands — including Anchor and Mainland — to French dairy giant Lactalis.

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