Fonterra reports $2.6 billion FY26 profit and $1 billion South Island investment

Fonterra has reported a significant surge in its FY26 financial results, posting a $2.6 billion after-tax profit on $27 billion in revenue. The reported operating profit of $3.4 billion represents a 97.6% increase compared to the previous year, bolstered by a $1.2 billion benefit from the sale of the Mainland Group.

Excluding the divestment, the underlying operating profit rose 23.6% to $1.8 billion. This performance allowed the co-operative to reach its target of restoring earnings to FY25 levels two years ahead of its original three-year schedule. The company also announced an additional $1 billion investment in its South Island manufacturing network over the next three years to expand protein production capacity.

For shareholders, the total cash returns reached $19.6 billion. The final Farmgate Milk Price for the 2025/26 season was set at NZ $9.69 per kgMS. Total dividends for the year reached 73 cents per share, including a 16-cent special dividend related to the Mainland Group sale. Looking ahead, the forecast for the 2026/27 milk price is NZ $9.50 per kgMS, with a range of $8.50 to $10.50.