Geekzone: technology news, blogs, forums
Guest
Welcome Guest.
You haven't logged in yet. If you don't have an account you can register now.
View this topic in a long page with up to 500 replies per page Create new topic
1 | 2 | 3 
2523 posts

Uber Geek
+1 received by user: 970

Lifetime subscriber

  Reply # 2090525 14-Sep-2018 10:54
Send private message quote this post

Geektastic: What do the salaries have to do with anything? It's the first loss posted in a very long time and the salaries are not altered on a monthly basis depending on performance.
Many of the staff will have no direct effect on profitability and the Danone compensation accounts for most of the loss and that's a one off.

 

Danone cost then about $230m and an investment in China written down by $400m or so... I hope these are one-offs so the big F should be profitable in the current year.

 

 


7393 posts

Uber Geek
+1 received by user: 3863


  Reply # 2090530 14-Sep-2018 10:59
Send private message quote this post

networkn:

 

Well, one thing is for sure, if I was CEO (Regardless of my pay), I wouldn't be too gutless to turn up in person to explain why my company lost $200M.

 

 

But he wasn't CEO.  He offered his resignation in March, the chair announced at that time that they'd been looking for a new CEO since Nov last year, and Spierings finished up (after working with interim CE) a fortnight ago.

 

From that I assume he had a little push, and I'm not sure what advantage there'd be having an ex CE - possibly with a grievance - addressing an AGM.  It's not as if he'd have been getting a smack on the hand and to be asked to do better - "or else".  "Or else" was already a done deal.  Up to the board and shareholders to work out if it's a smart move to employ a replacement with a similar contract.  I'd hope not, but that's up to the farmer (voting) shareholders to decide.


502 posts

Ultimate Geek
+1 received by user: 119


  Reply # 2090532 14-Sep-2018 10:59
Send private message quote this post

kryptonjohn:

 

Danone cost then about $230m and an investment in China written down by $400m or so... I hope these are one-offs so the big F should be profitable in the current year.

 

 

 

 

I agree with you. Normally I don't debate the high pay some CEO's received, however in this case  performance is demonstrably lacking. If he hadn't resigned, then perhaps it was time for the board to take action. Not only does this have a significant financial impact on NZ's economy, but also a significant impact in terms of reputation.


11900 posts

Uber Geek
+1 received by user: 3858

Trusted
Lifetime subscriber

  Reply # 2090577 14-Sep-2018 11:17
Send private message quote this post

kryptonjohn:

 

Geektastic: What do the salaries have to do with anything? It's the first loss posted in a very long time and the salaries are not altered on a monthly basis depending on performance.
Many of the staff will have no direct effect on profitability and the Danone compensation accounts for most of the loss and that's a one off.

 

Danone cost then about $230m and an investment in China written down by $400m or so... I hope these are one-offs so the big F should be profitable in the current year.

 

 

 

 

 

 

Exactly so. However at the end of the day, they are at present largely a commodity producer. It's not a difficult commodity to produce - grass, cows, milking parlour = milk so by sending a cadre of bright young things to agricultural college somewhere, many countries can replicate the production.

 

Fonterra will hopefully do better at adding value to the basic commodity because that is where the profit lies. One example I am often mindful of is a French brand, La Vache Qui Ri - or in English, Laughing Cow. It's a good quality soft cream cheese packed in ubiquitous triangles.

 

It is without a doubt one of the most commonly found brands of foreign dairy. I cannot tell you the obscure places in the world I have found that product on sale - tiny shops in Laos, Thailand, Cambodia, Vietnam, Burma, Indonesia, the Philippines, the USA - the stuff is everywhere (including of course NZ).

 

Fonterra really could do with turning Anchor into a brand found everywhere like Laughing Cow; oddly, I have found Anchor branded organic butter in Cambodia yet been unable to find it in NZ...!

 

 

 

If they really want to think outside the box, they could look at becoming the world's first national-scale 100% organic dairy producer. I have suggested to farming friends before that NZ could make billions by becoming a 100% organic nation in terms of farming, but I don't think they are ready for that. By 2023, the world market for organic dairy is set to hit US$30 billion...a bigger slice of that to NZ would be a sensible aim.






1396 posts

Uber Geek
+1 received by user: 201


  Reply # 2090581 14-Sep-2018 11:24
Send private message quote this post

Geektastic:

 

 

 

I don't regard that salary point as anything more than typically reasonable for a skilled professional and on the low side of that. I have no idea why, as a figure, it attracts so much attention. 

 

I'd be more interested in how many are earning over $300,000 but even that is no great indicator of much in a company the size of Fonterra.

 

Are all these staff only NZ staff, or are overseas staff included? FTE only or contractors as well (they have a fair few of those). How many were on 6/12/18 month projects not permanent?

 

So many variables.

 

 

 

 

Most of that information can be found on page 61 of the Financial Statements.  As a listed entity Fonterra is obliged to give the breakdown of remuneration.  Fonterra also disclose the composition across NZ, offshore and those employees that are no longer employed by the Group.


1079 posts

Uber Geek
+1 received by user: 266


  Reply # 2090610 14-Sep-2018 12:17
Send private message quote this post

http://blog.mixerdirect.com/global-dairy-market-outlook-2018

 

Interesting article including the paragraph about Belarus, Canada, Iran and Turkey. It would seem there is a slight over supply of dairy Worldwide. What this means for the next Global Dairy Auction on Tuesday is anyone's guess but I wouldn't hold my breath expecting any big increase.


BTR

1477 posts

Uber Geek
+1 received by user: 433


  Reply # 2090658 14-Sep-2018 13:52
One person supports this post
Send private message quote this post

I'd say its probably due to the fact that China wants in on the milk industry, they have been buying up farms, starting their own processing companies and exporting it themselves. Of course Fonterra are making a loss they have been cut out buy their biggest customer. 

 

 

 

And a good chunk the farmers who switched from Lamb and beef to dairy will most likely go bankrupt. 


2523 posts

Uber Geek
+1 received by user: 970

Lifetime subscriber

  Reply # 2090659 14-Sep-2018 13:53
Send private message quote this post

Also significant growth in supply coming from South America. However growth in demand may well exceed growth in supply for a while.

 

 


767 posts

Ultimate Geek
+1 received by user: 183


  Reply # 2090746 14-Sep-2018 15:55
Send private message quote this post

Geektastic:

 

kryptonjohn:

 

Geektastic: What do the salaries have to do with anything? It's the first loss posted in a very long time and the salaries are not altered on a monthly basis depending on performance.
Many of the staff will have no direct effect on profitability and the Danone compensation accounts for most of the loss and that's a one off.

 

Danone cost then about $230m and an investment in China written down by $400m or so... I hope these are one-offs so the big F should be profitable in the current year.

 

 

 

 

 

 

Exactly so. However at the end of the day, they are at present largely a commodity producer. It's not a difficult commodity to produce - grass, cows, milking parlour = milk so by sending a cadre of bright young things to agricultural college somewhere, many countries can replicate the production.

 

Fonterra will hopefully do better at adding value to the basic commodity because that is where the profit lies. One example I am often mindful of is a French brand, La Vache Qui Ri - or in English, Laughing Cow. It's a good quality soft cream cheese packed in ubiquitous triangles.

 

It is without a doubt one of the most commonly found brands of foreign dairy. I cannot tell you the obscure places in the world I have found that product on sale - tiny shops in Laos, Thailand, Cambodia, Vietnam, Burma, Indonesia, the Philippines, the USA - the stuff is everywhere (including of course NZ).

 

Fonterra really could do with turning Anchor into a brand found everywhere like Laughing Cow; oddly, I have found Anchor branded organic butter in Cambodia yet been unable to find it in NZ...!

 

 

 

If they really want to think outside the box, they could look at becoming the world's first national-scale 100% organic dairy producer. I have suggested to farming friends before that NZ could make billions by becoming a 100% organic nation in terms of farming, but I don't think they are ready for that. By 2023, the world market for organic dairy is set to hit US$30 billion...a bigger slice of that to NZ would be a sensible aim.

 

 

We export around $40 billion dollars worth of food product, by the time it is sold overseas it is worth over $250 billion dollars, we need to capture a greater portion of that pie if as a nation we want to grow as a nation.  This is going to become even more important as the synthetic food market grows (stem cell meat, synthetic milk and wine etc).

 

 

 

Ian Proudfoot has a really nice video on this https://www.youtube.com/watch?v=G4UK2WXQUG0 


1396 posts

Uber Geek
+1 received by user: 201


  Reply # 2090750 14-Sep-2018 16:02
Send private message quote this post

blackjack17:

 

 

 

We export around $40 billion dollars worth of food product, by the time it is sold overseas it is worth over $250 billion dollars, we need to capture a greater portion of that pie if as a nation we want to grow as a nation.  This is going to become even more important as the synthetic food market grows (stem cell meat, synthetic milk and wine etc).

 

 

 

Ian Proudfoot has a really nice video on this https://www.youtube.com/watch?v=G4UK2WXQUG0 

 

 

Sadly the same thing has been said about the forestry industry for years and years - despite this timber mills, pulp&paper mills - lots of the downstream value-add industries have closed and we export record volumes of logs overseas.  Unless we have significant manufacturing scale (bottom quartiles costs) and are cost effective at delivering final products to market then the milk industry will go same way.  


2853 posts

Uber Geek
+1 received by user: 491


  Reply # 2090925 14-Sep-2018 22:25
Send private message quote this post

networkn:

So, they post a $200M loss. Also annouced is the fact *6000* staff earn over 100K. Seriously!?


No wonder dairy prices are insane here.


 



Two points.

The price Fonterra gets for the bulk of their product is set on the world stage. This price in turn determines what they get for their product locally.

The price you pay at the supermarket is set by the supermarket and I rather suspect has more to do with the retailers margins than the cost price.




Sony Xperia X running Sailfish OS. https://sailfishos.org The true independent open source mobile OS 
Samsung Galaxy Tab S3
Nokia N1
Dell Inspiron 14z i5


1 | 2 | 3 
View this topic in a long page with up to 500 replies per page Create new topic

Twitter »

Follow us to receive Twitter updates when new discussions are posted in our forums:



Follow us to receive Twitter updates when news items and blogs are posted in our frontpage:



Follow us to receive Twitter updates when tech item prices are listed in our price comparison site:



Geekzone Live »

Try automatic live updates from Geekzone directly in your browser, without refreshing the page, with Geekzone Live now.



Are you subscribed to our RSS feed? You can download the latest headlines and summaries from our stories directly to your computer or smartphone by using a feed reader.

Alternatively, you can receive a daily email with Geekzone updates.