The FY2021 reported loss was $28.5million compared with a $74.5m profit in the previous financial year.
Synlait has not yet published a guidance for FY22, but it has promised a return to pre-covid net profit levels from FY24 and beyond.
Senior management and governance changes have been made to drive the recovery.
The board has recruited Miraka chief executive Grant Watson to take over from Penno at Synlait early next year, moved Penno into the chair for two years interim and announced dairy industry stalwart Paul McGilvray an incoming independent director in 2022.
Current chair Graeme Milne will step down when Watson arrives, after 17 years as a director and will serve a further year as a board advisor.
Penno and his chief financial officer Rob Stowell said covid-19’s hit on Synlait was late and very hard with what they call a bullwhip effect.
Essentially, the company produced large volumes of infant formula base during the peak milk season to meet growing market expectations, only to have demand from large customer and 20% shareholder, a2 Milk Company, fall away dramatically.
Sales volume of infant formula fell 36%, revenue by 30% and gross profit per tonne fell by 60%, as a2 was severely impacted by covid’s disruption to Chinese sales channels.
Synlait was forced to turn much more milk into lower-value dairy ingredients, whole milk and skim milk powders and anhydrous milk fat.
It also slightly exceeded Fonterra in paying an average farm gate milk price of $7.82/kg milksolids, consisting of $7.55 base price plus an average 27c of incentives through the Lead With Pride programme.
Milk collected went up by 10m kg milksolids to 86.8m and the total procurement cost for milk was $655m.
