Ravensdown changes way it does business and ups farmer rebate
Farmers investing in smart fertiliser products have helped Ravensdown post a profit of $51 million before tax and lift the rebate paid to shareholders.
While the profit was down on last year's figure of $62m, the Christchurch-based fertiliser company is paying a total annual rebate of $45 per tonne, the same as its major rival Ballance Agri-Nutrients announced two weeks ago. This compares to last year's rebate of $41/tonne.
For those who bought solid fertiliser before the end of May, $20 of the total rebate has been already paid out; for fully paid-up shareholders, the remaining $25 per tonne will be paid in cash this month.
Sales volumes were up by 2 per cent, driven by new customers but revenue fell 5 per cent to $627 million because price reductions were delivered early in the year.
Chief executive Greg Campbell said the co-operative's environmental consultancy was its fastest-growing service and was part of the transformation the business was undergoing.
"There's been a 220 per cent growth in the consultancy. We employ 22 staff in it at present but that will rise to 60."
There had been a rise in what he described as "prescription" fertiliser.
"It's a bit like in the past going to the doctor and being prescribed one drug like Panadol for everything. We can now target directly, which has benefit for production and the environment."
There was growing demand for the product N-Protect, the only Fertmark-certified urease inhibitor in New Zealand, but Ravensdown was careful to advise farmers not to use it wastefully. It was best applied in hot, dry weather, or else it was just "money down the drain".
He said the days of haphazardly spreading fertiliser were changing to a more targeted approach through the use of the precision application service IntelliSpread. The Civil Aviation Authority has given approval for the co-operative's fleet of topdressing planes to be upgraded to deliver this service.
Campbell cautioned farmers should make sure the products they were being carried the Fertmark certification.
Other highlights included $42m invested in infrastructure including new loaders, conveyors, roofing, laboratories and high precision blending machinery, totalling more than $100m in the past three years; $5m invested in new technology and $4m supporting research and development. Operating cashflow was $60m.