Norco profits jump to more than $3m
Lismore-based dairy producer Norco has boosted its annual profit by more than $3 million on the back of several acquisitions, including a buyout of its former joint-venture partner Parmalat Australia.
The farmers co-operative posted a $3.8 million net profit for 2005/06, up from $196,000 in 2004/05. It was described as a strong performance by a jubilant chairman, Greg McNamara, after the companys annual general meeting on Tuesday.
This year Norco formed an alliance with the worlds fifth largest dairy company, the Fonterra Group, to market and distribute Norcos fresh milk in Australias eastern states from the end of next month.
He said the alliance should help Norco, which has more than 400 members and 190 farms supplying it with milk, to increase its milk volumes and distribution of its products, and ultimately profits.
Norcos success this year will allow it to pay its farmers an extra 4.1 cents per litre of milk from January, lifting the price to about 38 cents a litre.
Its probably the largest increase Ive ever seen its massive, Mr McNamara said.
The lift in price, he said, would help keep farmers in business by helping them meet increased costs of feed for their cows. He said the drought had seen grain prices leap from about $200 a tonne to around $350 a tonne.
He warned that continued increases in grain prices would eat away at the companys future profits.