New Zealand's Fonterra <FCG.NZ> said on Friday it expects to continue paying dividends as asset sales and focus on domestic business helped the world's largest dairy exporter return to profit in fiscal 2020 from a record loss last year.
The company reduced its debt by more than NZ$1 billion ($675.40 million) and paid a final annual dividend of 5 New Zealand cents per share, compared with no payout last year.
"This year marks a return to paying dividends, a position we expect to maintain in the future, assuming normal operating conditions," Chairman John Monaghan said.
Fonterra had unveiled a "back to basics" strategy last year that put a halt to the previous management's failed overseas expansion plans and pledged to cut debt by focusing on domestic production.
That helped the dairy exporter report net profit after tax of NZ$659 million for the year ended July 31, compared with a loss of NZ$605 million reported last year that was largely driven by asset write-downs.
For fiscal 2021, it retained its earlier guidance for farmgate milk price - the price it pays to farmers for milk - to between NZ$5.9 and NZ$6.9 per kilogram of milk solids.
It forecast normalized annual earnings per share between 20 NZ cents and 35 NZ cents, compared with 24 NZ cents per share a year earlier.
($1 = 1.4806 New Zealand dollars)
(Reporting by Sameer Manekar in Bengaluru; Editing by Krishna Chandra Eluri)
