Alliance Group displayed agility in an unprecedented year as a result of COVID-19 and adverse weather conditions, shareholders were told at the company’s Annual Meeting in Invercargill last week (December 17). 

Last month, Alliance Group announced an underlying profit of $27.4 million. Adjusted for a one-off event of ‘donning and doffing’, the annual profit result was $7.5 million before tax. 

New Zealand’s only 100 per cent farmer-owned major red meat co-operative achieved a record turnover of $1.8 billion for the year ending 30 September 2020.  

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“It was a challenging farming season with extreme drought in the northern and central regions and a very difficult spring and early summer in Southland and South Otago,” Alliance Group chairman Murray Taggart said. 

“The difficult conditions on farm were compounded by COVID-19, which directly impacted Alliance’s global markets and ultimately our farmers through volatile farm-gate prices. 

“These adverse events tested the resilience of the co-operative, however a major factor in ensuring we ended the year in a sound financial position was the agility demonstrated by our people. 

“Our sales team redirected products between markets as they opened and closed in the face of COVID-19, our plants changed the cut configurations to match changing markets and our logistics teams redirected containers and changed ships. 

Challenging conditions and Covid-19 tested farmers' resilience, chairman Murray Taggart said. PHOTO: Alliance Group

Alliance Group chief executive David Surveyor said the co-operative pursued a significant capital expenditure programme this year, despite the challenges. 

“We invested significantly in health and safety, improved plant efficiencies and rolled out our Enterprise Resource Planning technology project. Healthy operating cash flows at $50.3m give confidence to our continued investment profile. 

“We are focused on capturing the raft of opportunities we have to improve the business, lift profitability and return more value to our farmers. 

“We have finished the year with a solid profit of $27.4m from ongoing operations with our best underlying profit result in the last 10 years. We have relatively low inventory levels, given the impact of COVID-19 on markets, so the business is well positioned for the future. 

“Looking forward, world markets remain relatively stable, given global events. Access to China remains critical to maintaining farm-gate returns. The roll-out of the COVID-19 vaccine over the coming months will help life return towards some level of normality across our key markets. While prices have retreated from their highs, returns to farmers remain solid relative to historical pricing. 

“We are conscious of the pressure that has been placed on our people during this period as they have gone above and beyond for farmers, colleagues and local communities. We are grateful for their efforts.” 

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Directors’ election results 

The successful candidates to fill two vacancies on the board of Alliance Group were Dawn Sangster and Pat McEvedy. 

The directors’ election drew 46.96 per cent of eligible votes, with 27.48 per cent of shareholders exercising their vote.  

Mrs Sangster won 23,729,251 votes and Pat McEvedy won 20,538,214 votes. 

The unsuccessful candidates were Russell Drummond (20,335,533 votes) and Stuart Campbell (10,762,549 votes).