Bega Cheese (BGA) H2 2025 earnings summary

Executive summary

• Achieved strong FY2025 results with robust normalised earnings growth, driven by strategic focus on productivity, innovation, and cost optimisation, despite a constrained consumer environment.

• Major structural changes included closure of Strathmerton and PCA sites, sale of Leeton site, and consolidation of operations to deliver future efficiencies.

• Transformation from commodity-focused to branded, value-added business, with international expansion and innovation in dairy proteins and functional products.

• Achieved volume growth in white milk, yoghurt, and spreads, with new high-protein and 'better for you' products launched.

• Improved staff engagement, safety, and operating cash flow, maintaining a strong balance sheet with a leverage ratio of 0.8x.

Financial highlights

• Group normalised EBITDA rose 23% to $202.0m, with gross margin expanding to 21.5%.

• Earnings per share up 73% to 16.6c; net debt reduced to $126.1m, leverage ratio at 0.8x.

• Achieved $40m in cost savings in FY2025, with another $40m targeted for FY2026.

• Normalised profit after tax surged 74% to $50.8m; statutory loss after tax of $(8.5)m due to impairment and one-time costs.

• Fully franked dividend increased 50% to 12.0c per share.

Outlook and guidance

• Guidance for FY2026 normalised EBITDA of $215m–$220m, underpinned by branded segment growth and ongoing cost initiatives.

• On track to exceed $250m EBITDA by FY2028, with strong new product pipeline and international expansion.

• Expect continued investment in automation, AI, and process optimisation to drive further efficiencies.

• Improving consumer sentiment and robust new product development pipeline.

• Accelerated international expansion and planned site closures to support efficiency.