Synlait did not declare a dividends for the first half of the year.
Shares of New Zealand’s Synlait Milk tumbled nearly 12% after the dairy producer projected subdued growth in the second half of the year as it balances operational changes with potential risks linked with milk stream returns, reported Reuters.
The stock is on track for its weakest trading session since mid-July, falling to NZ$0.89 per share, also its lowest level in three weeks.
The forecast comes on the heels of Synlait’s swing to profitability in the first half of the fiscal year, helped by a surge in demand for its nutrition products.
The company anticipates a slower second half compared to the first six months of the year, with ongoing operational and cost improvements along with foreign exchange risks.
Synlait’s return to profitability coincides with a leadership transition, with company veteran Richard Wyeth taking over as CEO in mid-May.
However, the infant formula maker expects an improvement in its overall earnings before interest, taxes, depreciation and amortisation performance in fiscal 2025 from 2024.
Interest from potential new farmer suppliers has exceeded expectations, suggesting newer recruitments based on the strength of its on-farm offering in the upcoming seasons, the firm said.
Synlait did not declare a dividend for the first half of its fiscal year.
($1 = 1.7446 New Zealand dollars)
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