New Zealand | Fonterra expects a net loss of more than NZ$590 million

Before publishing its annual results in September, Fonterra spoke out Impairment of its assets (between NZ$820 and 860 million)Which affects the reduction of its net income. “We expect Net loss of NZ$590 million to NZ$675 million“ For the 2019 fiscal year ending July 31, 2019, a press release issued by the cooperative indicates.

This decline relates to five main areas. 1 – The poor performance of the Data Protection Authority in Brazil is mainly due to “The economic situation in Brazil. (…) Consumer confidence and employment are not at the level required to support the sales volumes and prices on which our cash flow forecasts were based.”. 2- The sale and closure of Venezuelan companies, due to economic and political instability, resulted in an accounting adjustment of approximately $135 million. 3- The book value of Chinese farms will decrease by about $200 million, due to slower than expected operating performance. 4- The ingredients department in Australia is suffering from the effects of severe drought. 5 – Finally, even in New Zealand, in the consumer business, Fonterra was forced to write down the value of its assets by about $200 million. Fonterra is rebuilding this business.