Fonterra Co-operative Group (FCG) Q3 2025 earnings summary

Executive summary

• Profit after tax rose 11% year-over-year to $1,081m, with normalised profit after tax, excluding $77m in consumer divestment costs, reaching $1,158m (70c per share).

• Operating profit increased to $1,740m, up $267m from last year, driven by strong performance in Ingredients and Consumer segments.

• FY25 earnings guidance narrowed to 65–75c per share, with the midpoint lifted to 70c, and Farmgate Milk Price forecasts remain robust.

• Strategic focus remains on Ingredients and Foodservice channels, with divestment of the global Consumer business progressing as planned.

• Foodservice Q3 operating profit grew 52% year-over-year, though normalised operating profit was $55m below last year's record.

Financial highlights

• Operating profit increased 20.3% year-over-year to $1,732m from $1,440m.

• Revenue rose 15.9% to $19,699m, with gross profit up 10.9% to $3,389m.

• Earnings per share increased to 70c from 62c year-over-year.

• Interim dividend of 22c per share paid; rolling 12-month Return on Capital at 11%.

• Gross margin slightly decreased to 17.2% from 18.0% year-over-year.

Outlook and guidance

• Maintained 2024/25 Farmgate Milk Price forecast range of $9.70–$10.30 per kgMS; 2025/26 opening forecast set at $8.00–$11.00 per kgMS.

• FY25 normalised earnings per share guidance narrowed to 65–75c, with midpoint lifted to 70c.

• Q4 in-market channel performance expected to be up on prior year, but offset by seasonality and cost increases.

• Capital return to shareholders and unit holders targeted post-divestment.