Fonterra Co-operative Group has reported a solid financial performance for the first half of FY26, with revenue rising to $13.9 billion, up by $1.3 billion on the same period last year. The Co-op also posted an operating profit of $1,231 million and a profit after tax of $750 million, both showing year-on-year growth.
Earnings per share increased slightly to 45 cents, while normalised earnings reached 51 cents per share. Return on capital also improved to 11.2%, sitting comfortably within the Co-op’s target range. An interim dividend of 24 cents per share has been घोषित, alongside a special Mainland dividend of 16 cents per share.
The Co-op has lifted its forecast Farmgate Milk Price midpoint to $9.70 per kgMS, reflecting improved global commodity prices. Forecast earnings for the full year have also been upgraded to a range of 50 to 65 cents per share.
CEO Miles Hurrell said, “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. Demand for our products is strong, and we’re focused on our plan to maximise both the Farmgate Milk Price and earnings.”
He added that while performance has been strong, ongoing global uncertainty remains a factor. “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.”
Operationally, Fonterra benefited from strong milk collections and resilient network performance despite weather-related challenges. Growth in high-value product segments, particularly in Ingredients and Foodservice, contributed to improved returns.
Progress continues on the $4.22 billion sale of the Mainland Group to Lactalis, which is expected to complete by the end of March 2026. The Co-op is now focused on its strategy as a global B2B dairy nutrition provider.
Investment in infrastructure remains a priority, with several projects underway across New Zealand, including new protein, butter, and cream facilities. These developments aim to support rising demand and enhance production capacity.
Looking ahead, Fonterra expects continued volatility in global markets but remains confident in its ability to manage supply chain pressures and deliver on its strategic goals.