Fonterra announces FY24 Annual Results and special dividend

Fonterra Co-operative Group Limited


Fonterra Co-operative Group Page 1

Results for Announcement to the Market
Results for announcement to the market
Name of issuer
Fonterra Co-operative Group Limited
Reporting Period 12 months to 31 July 2024
Previous Reporting Period 12 months to 31 July 2023
Currency NZD

Amount (000s) Percentage change
Revenue from continuing operations $22,822,000 (7 %)
Total Revenue $22,994,000 (1 2%)
Net profit from continuing operations $1,168,000 (6%)
Total net profit $1,128,000 (2 8%)
Final Dividend
Amount per Quoted Equity Security $0.40
Imputed amount per Quoted Equity Security Not Applicable
Record Date 2 October 2024
Dividend Payment Date 11 October 2024
Current period Prior comparable period
Net tangible assets per Quoted Equity
Security
$3.97 $3.82
A brief explanation of any of the figures
above necessary to enable the figures to be
understood

Authority for this announcement
Name of person authorised to make this
announcement
Anya Wicks
Contact person for this announcement Anya Wicks
Contact phone number (09) 374 9341
Contact email address Anya.wicks@fonterra.com
Date of release through MAP 25 September 2024
Audited financial statements accompany this announcement.

---

25 September 2024

Fonterra continues momentum in FY24, announces special dividend

• Profit after tax: NZ $1,168 million
• Continuing operations EBIT*: NZ $1,560 million
• Continuing operations earnings* per share: 70 cents per share
• Return on capital: 11.3%
• Total dividend: 55 cents per share, comprising:
o 15 cent interim and 25 cent final dividend
o 15 cent special dividend
• Full year milk collections: 1,471 million kgMS 
• Final 2023/24 season Farmgate Milk Price: NZ$7.83 per kgMS 

Fonterra Co-operative Group Ltd has today reported strong FY24 full year financial results, including a final
2023/24 season Farmgate Milk Price of $7.83 per kgMS and a total dividend of 55 cents per share.

CEO Miles Hurrell says the payout reflects both Fonterra’s continued strong earnings performance and the
long-term resilience of the Co-op.

“We’ve maintained the positive momentum seen in FY23 and delivered earnings at the top end of our
forecast range.

“Our total dividend of 55 cents per share is the second largest since Fonterra was formed. It includes a 15
cent interim dividend and a 25 cent final dividend driven by strong FY24 earnings.

“In addition, our capital management efficiency and ongoing balance sheet strength have enabled us to
return an extra 15 cents per share to farmer shareholders and unit holders through a special dividend.

“The final Farmgate Milk Price for the 2023/24 season finished at $7.83 per kgMS. This, combined with the
55 cents per share dividend, provides a total cash payout to a fully shared up farmer of $8.38 per kgMS.

“Our Co-op is in good shape, and I'm pleased to have delivered another year of solid returns to farmer
shareholders and unit holders.

“Looking ahead, we’re well placed to consider the next phase of our strategy to grow long-term value for
the Co-op,” says Mr Hurrell.

Business performance

The Co-op reported a return on capital for FY24 of 11.3%, above the target range for FY24.
Earnings (EBIT) from continuing operations were $1,560 million and continue to be well above previous
years, albeit down on FY23 which benefitted from elevated price relativities.

Fonterra’s profit after tax from continuing operations was $1,168 million, equivalent to 70 cents per share.
“Our FY24 earnings were driven by higher margins and increased sales volumes in our Foodservice and
Consumer channels. Our Ingredients channel also continued to deliver strong returns, although down
when compared to the record result seen in FY23,” says Mr Hurrell.

Fonterra Co-operative Group
Page 2


Sales volumes from continuing operations were down 1% to 3,470 kMT and gross margins were
maintained at 17%.


“We remain focused on making progress against our two efficiency metrics while also investing in the
areas that will improve long-term performance and the resilience of the Co-op.

“Our core operations manufacturing costs per kgMS reduced year-on-year by 2% to $2.58 per kgMS,
reflecting both operational improvements and improved input costs.

“Across the year we also achieved savings in our operating expenses which largely offset the impacts of
inflation. However, our cash operating expenses per kgMS are up mainly due to our investment in IT and
digital transformation projects.

“Our balance sheet position remains strong, providing optionality and flexibility for the future and resilience
against volatility.

“We have net debt of $2.6 billion, $600 million lower than last year, due to strong underlying operating
performance.


Our gearing ratio of 24% reflects our lower net debt position and higher equity from strong earnings,” says
Mr Hurrell.

Co-op strategy


This year, Fonterra completed a strategic review that reinforced the role of its Foodservice and Ingredients
channels and confirmed its strengths in partnering with customers to produce world-class, innovative dairy.


As a result of this work, in May the Co-op announced that it is exploring divestment options for its global
Consumer business, as well as Fonterra Oceania and Sri Lanka.

“Over the last few months, we have appointed advisors to assist with assessing divestment options for our
Consumer businesses and this work is ongoing,” says Mr Hurrell.

“As we can see from today’s result, the businesses in scope for potential divestment are performing well.
We remain committed to a pathway that would maximise value of these businesses for our farmer
shareholders and unit holders.


“Alongside this, we have revised our strategy to have a sharper focus on the Co-op’s strengths and where
we can best create value.

“We will be sharing this revised strategy, as well as the outcomes shareholders and unit holders can
expect from the Co-op, next week,” says Mr Hurrell.


*Excludes earnings from discontinued operations. In FY24 discontinued operations were DPA Brazil and in
FY23 discontinued operations were DPA Brazil, Soprole and China Farms.


ENDS



For further information contact: 

 
James Kaufman
Fonterra Communications 
Phone: +64 21 507 072 

Fonterra Co-operative Group
Page 3

About Fonterra 
 
Fonterra is a co-operative owned and supplied by thousands of farming families across Aotearoa New Zealand. Through the spirit
of co-operation and a can-do attitude, Fonterra’s farmers and employees share the goodness of our milk through innovative
consumer, foodservice and ingredients brands. Sustainability is at the heart of everything we do, and we’re committed to leaving
things in a better way than we found them. We are passionate about supporting our communities by Doing Good Together.

Non-GAAP financial information

Fonterra uses several non-GAAP measures when discussing financial performance. Non-GAAP measures are not defined or
specified by NZ IFRS.

Management believes that these measures provide useful information as they provide valuable insight on the underlying
performance of the business. They may be used internally to evaluate the underlying performance of business units and to
analyse trends. These measures are not uniformly defined or utilised by all companies. Accordingly, these measures may not be
comparable with similarly titled measures used by other companies. Non-GAAP financial measures should not be viewed in
isolation nor considered as a substitute for measures reported in accordance with NZ IFRS.

Non-GAAP measures are not subject to audit unless they are included in Fonterra’s audited annual financial statements.

---

Results overview3-9
Drivers of operating performance10-16
Financial outcomes17-26
Outlook27-31
Appendix32-68
Flexible Shareholding metrics69-72
Additional Information73-80

 from 95c
 from 1,577m
 from 1,755m
 from 12.4%
 from 50c
 from 28.8%
 from $8.22
 from 75c

•55 cents per share
–Full year dividend of 40c made up of 15c interim dividend and 25cfinal dividend
–Special dividend of 15c reflecting capital management efficiency and robust balance sheet
5
2020
50
55
6.6%6.6%
6.8%
12.4%
11.3%
20202021202220232024
Dividends (cents)
Return on capital
•Resilience provides optionality and flexibility for future investments and mitigates volatility
•Balance sheet strength
–$2.6b net debt, $0.6b lower due to strong underlying operating performance and lower working
capital. Year-end inventory was down 25k MT (4%), equivalent to $0.2b
–Gearing ratio of 24.0% reflecting lower net debt and higher equity due to strong earnings
•Continued investment in essential and sustainability capital projects and strategic opex, including
enterprise systems, energy and wastewater projects
5.2
4.3
5.3
3.2
2.6
44%
39%
42%
29%
24%
20202021202220232024
Net debt ($b)
Gearing
1.3
0.9
0.9
1.8
1.6
48
31
36
75
70
20202021202220232024
Operating profit ($b)
EPS (cents)
•$1.6b operating profit (EBIT) from continuing operations
–Ingredients EBIT of $898m, down $657m; price relativities easing from prior year record high
–Foodservice EBIT of $463m, up $138m; improved margins and higher allocation of milk solids
–Consumer EBIT of $199m, up $324m; improved margins and lower operating expenses
•70c earnings per share from continuing operations
–Equivalent to profit after tax of $1.17b
•(3) cents per share from discontinued operations
•11.3% return on capital
–Significantly above 5-year average and above FY24 target range

•Announced the potential divestment of some or all of
our global Consumer business plus Fonterra Oceania
and Fonterra Sri Lanka
−Appointed advisors to assist with assessing our
divestment options
•Announced three new investments for the future
−$75m in a high-value protein hub at Studholme
−$150m to build a new UHT cream plant
at Edendale
−$150m to build a new cool store at Whareroa site
in Taranaki
•Collaboration with customers to support and accelerate
best practice in sustainability
•18.5% reduction in Scope 1 & 2 emissions across our
operations
•12.4% reduction in water use and the implementation
of Water Improvement Plans at all our global sites
•Announced a target 30% intensity reduction in on-farm
emissions by 2030 (from a 2018 baseline) to support
the emissions reduction profile of products
•Developed and implemented an AI based fault
detection system that improved butter and powder
packaging efficiency, reducing plant downtime
•Manufacturing innovation using steam infusion
technology to increase run time and yields for UHT
cream
•Collaborated with QSR customers to develop a soft
style mozzarella that improved quality of home
delivered pizzas
•Inaugural Horizon Awards to celebrate the innovation
of our people across the co-op with 240 entries


1.0%

0.5%
•Outlook for dairy trade is positive
–Continued strong demand from key import
regions, particularly Southeast Asia, and
Middle East and Africa
–China import demand impacted by
prioritisation of domestic milk supply
–EU production recovered due to stable milk
price and lower on-farm costs
–US production impacted by lower herd sizes
due to favourable beef prices
–Australia production increased due to better
weather conditions, high milk prices and
lower on-farm costs
–New Zealand current season production has
started strong due to favourable weather
conditions and early calving
•Lower production by litres in US offset by
improved milk solids yield per cow
•Slower domestic demand growth and lower milk
price in China impacting its local milk
supply growth

1.1%

0.2%

14.7%

12.0%

12.3%

10.0%

9.6%

0.2%

3.2%

3.1%

4.3%

2.4%

6.6%

6.3%
Note: Refer to additional information for source data and date ranges

•The average price for the Reference portfolio declined USD 450 per MT or 12%, compared with the Non-Reference portfolio which
declined by USD 764 per MT or 15% year-on-year, narrowing the spread between the two
•Stronger demand in the Reference portfolio in the second half. Greater demand for butter and AMF due to the market stabilising post-
covid with growth in the bakery channel across all markets and continued strong demand for powders from Southeast Asia and Middle
East markets
•Non-Reference pricing has remained relatively stable through FY24 after a significant decline in Q1
FY22
(USD/MT)
Note: Refer to additional information for source data and date ranges
FY23
FY24
Reference Product shipment price
Non-Reference Product shipment price
Annual average Non-Reference and
Reference price
2,500
3,500
4,500
5,500
6,500

$6
$7
$8
$9
$10
JunJulAugSepOctNovDecJanFebMarAprMay
2022/23 season2023/24 season
•Reference Product prices that informed the 2023/24 season were lower than
prior season
•The lower product prices were partially offset by favourable currency hedge
movements, as the NZD:USD trended downwards
•14 cents, or $147 million, of inflationary increases in the cost of most inputs,
with significant increases in the cost of energy, staff costs, packaging and
motor vehicle
($ per kgMS)
2022/23 season monthly milk
prices average to $8.22, the
Farmgate Milk Price
2023/24 season monthly milk
prices average to $7.83, the
Farmgate Milk Price
($ per kgMS)
8.22
7.83
0.01
0.39
(0.65)
(0.14)
22/23 season
Farmgate
Milk Price
VolumePricesForeign
exchange
Net costs23/24 season
Farmgate
Milk Price
•38% of milk was collected and manufactured in September to November,
and product prices informing monthly milk prices during this period were 19%
lower than prior season
•FY24 Foodservice and Consumer gross margins during Q1 – Q3 are higher
relative to prior year due to lower cost of milk at start of financial year
•Monthly Milk Prices in April and May over $9 impacted Q4 gross margin

•Higher FY24 dividend reflects higher earnings over the last two
years and a robust balance sheet
•Strong balance sheet enabled further improvement in advance
rate payments
–In 2023/24, early season payments increased to 75% of the
total forecasted milk price, up from the historical 65%
–In 2024/25 milk payments for early in the season have
increased to 85%
$7.14
$7.54
$9.30
$8.22
$7.83
$0.05
$0.20
$0.20
$0.50
$0.55
$0.50
20202021202220232024
Farmgate Milk PriceDividendsCapital returns
1
1.Cash returns announced in a calendar year

8,8568,5818,4358,2828,141
155
246
222
159
110
20202021202220232024
Shareholding farmsNon-shareholding farms
164,402
170,836
167,437
171,249
174,261
Average production per farm (kgMS)
Fonterra milk collection market share in New Zealand
80.0%
79.0%
79.1%
79.0%
78.1%
•Higher average production per farm mainly due to improved production
per cow and an increase in average farm size
•Focus on quality over quantity resulted in greater solid availability in milk
•Milk collected from 8,141 shareholding and 110 non-shareholding farms
around New Zealand. Supplying farms numbers lower due to:
–smaller farms converting to other land uses
–increase in competitor activity
•Non-shareholding farms largely made up of farms supplying MyMilk and
expected to steadily decline as the Co-operative no longer accepts new
applications for MyMilk with the introduction of flexible shareholding
structure
•Majority of farmers who exited MyMilk programme before the end of
2023/24 season, joined the Co-operative as supplying shareholders
1. Includes shareholding farms that were supplying milk as at 31 July
1

2.4 2.4
2.8
3.1
3.2
20202021202220232024
Collection costs (cents/litre)
97.8%
98.6%
98.5%
97.7%
98.0%
20202021202220232024
Collected in full on time
•Cost of collecting milk increased due to rising Road
User Charges after the temporary reduction ended
in June 2023, partially offset by favourable
diesel prices
•Inflation impacted staff and vehicle maintenance
costs
•Use of data and analytics to monitor fuel efficiency
by tanker and driver enabled targeted training to
improve efficiency
•“Collected in full on time” (CIFOT) is the measure
of how well we have performed in collecting our
farmer owners’ milk within our planned collection
windows
•Performance has remained strong and stable
•The rollout of milk vat monitoring technology has
enhanced our planning and management of milk
collection
16,876
17,121
16,404
16,317
16,001
1,5171,539
1,4781,4801,471
20202021202220232024
Litres collected (million)kgMS collected (million)
1,4821,5031,4441,4441,437
30
31
30
33
31
5
5
4
3
3
20202021202220232024
FonterraDIRA Bulk LiquidOther Bulk Liquid

1,168
154
121
1,177
180
124
1,105
183
107
1,196
195
97
1,160
210
111
IngredientsFoodserviceConsumer
FY20FY21FY22FY23FY24
8.4%
8.4%
7.7%
6.5%
7.5%
Note: Data presented as sales by channel
10.7%
12.1%
13.1%13.1%
14.2%
80.9%
79.5%
79.2%
80.4%
78.3%
% milk solids sold
(kgMS millions)
IngredientsFoodserviceConsumer

•Higher proportion of solids allocated to Foodservice and Consumer to capture higher margins in these channels
•Increased allocation of solids in Foodservice was due to higher demand in Greater China, particularly UHT cream
•A higher proportion of Ingredients was sold in FY23 due to the additional inventory carried over from FY22

•Milk utilisation (the proportion of milk solids made into products)
improved due to favourable product mix and improved operational
performance
−Favourable product mix due to increased production of skim
and cream products that have lower processing losses
•Unplanned downtime has improved through implementing robust
maintenance strategies
−Strategic projects such as Run to Target have improved
manufacturing efficiencies, lifting performance and operational
efficiency through standardised activity across operations
96.4%96.4%
96.5%
96.3%
96.7%
20202021202220232024
94.0%
95.0%
94.5%
95.3%
95.8%
20202021202220232024
$58m $58m
$72m
$56m
$92m
20202021202220232024
6.9%
6.5%
6.4%
5.8%
5.0%
20202021202220232024
•Product made right first time measures the percentage of
products that pass grading tests immediately after manufacturing
−improved to 95.8% mainly due to process improvements
which includes efficiencies through Run to Target programme
•Cost of quality is one of our key measures of the effectiveness of
our manufacturing activity
−two events relating to a sensory matter and product discounts
which resulted in a $29m impact

($ million)
($/kgMS)
$2.53
$2.51
$2.49
$2.63
$2.58
$2.06
$2.11
$2.30
$2.62
$2.58
20202021202220232024
Inflation adjustedActual
Actual ($ million)
3,1283,2433,3973,883
3,789
Cumulative inflation
1
22.5%19.2%8.3%0.3%
Inflation adjusted ($ million)
3,8343,8643,6783,893
3,789
(kgMS million)
New Zealand
1,5171,5391,4781,480
1,471
1.Real costs have been calculated using CPI and inflation in manufacturing components
•Achieved a 2% reduction in FY24 in line with target
•Key drivers of reduction in FY24 include:
−procurement benefits for materials and inputs
−shift in the product mix to lower cost products
−efficiency gains through performance improvement programs partially
offsetting inflation and labour cost increases
•Core Operations manufacturing costs per kgMS is the efficiency component
of the Gross Profit from Core Operations metric – see slide 61
3,883
(221)48
51
28
3,789
FY23MaterialsLabourEnergy &
packaging
OtherFY24
2.62
$ / kgMS
0.14
0.04
2.58

0.04
0.02



$1.32
$1.29
$1.28
$1.35
$1.36
$1.09
$1.10
$1.17
$1.30
$1.36
20202021202220232024
Inflation adjustedActual
(m kgMS)
35 kgMS  $7m $0.02 /kgMS 
13 kgMS  $62m  $0.17 /kgMS 
14 kgMS  $25m  $0.25 /kgMS 
($m)
Operational expenses
1,7631,8101,8582,046
2,067
IT & Digital transformation
---2281
Total
1,7631,8101,8582,068
2,148
Compound CPI
21.3%17.5%9.5%3.3%
Inflation adjusted
2,139 2,127 2,034 2,136 2,148
(kgMS million)
New Zealand
1,5171,5391,4781,480
1,471
Australia
107106106106107
Total
1,6241,6451,5841,5861,578
•Cash opex savings achieved largely offset the impact of inflation (3.3%)
and product mix change to higher cost products
•Increase in total cash operating expenses reflect investment in IT and
digital transformation that is expensed, rather than capitalised
•Foodservice cash opex per kgMS increased by $0.17 per kgMS due to
increased selling and marketing, IT and staff costs to support business
growth. Gross profit increased by $0.65 per kgMS
•Consumer cash opex has reduced by $0.25 per kgMS, as increased
investment in selling and marketing resulted in a 9% lift in sales volumes
and a lift in gross profit of $0.34 per kgMS
Note: Data is a 12-month rolling average for continuing operations. Comparative information has been represented for consistency with the current period
($/kgMS)

17.8
18.0
20.1
21.4
19.1
10.32
10.22
11.99
12.32
11.72
20202021202220232024
21.0
21.1
23.4
26.0
23.0
12.16
12.00
13.98
14.96
14.11
20202021202220232024
(million MT)($ billion)($ billion)($ billion)
($ billion)($ billion)
1.Note: All figures are for the year ended 31 July. ‘Other’ not included in the charts and is the reconciliation difference in calculating EBIT from gross profit
4.1
4.1
3.9
4.0
3.5
1.73
1.76
1.68
1.74
1.63
20202021202220232024
2.5
2.3
2.5
2.8
2.5
1.44
1.33
1.47
1.61
1.51
20202021202220232024
3.2
3.1
3.3
4.6
3.9
1.83
1.78
1.99
2.64
2.39
20202021202220232024
1.1
1.0
1.0
2.2
1.5
0.66
0.54
0.58
1.27
0.94
20202021202220232024
Total Group $/kgMS
($ billion)
0.48
0.36
0.39
0.64
0.40
0.28
0.20
0.23
0.37
0.24
20202021202220232024
($ billion)
0.7
0.6
0.6
1.6
1.1
0.38
0.34
0.35
0.91
0.69
20202021202220232024
billion kgMS

Segments
2,218(463)
1,755(691)
363
1331,560(33)
1,527
FY23 Total Group
EBIT
Discontinued EBITFY23 Continuing
operations EBIT
Core OperationsGlobal MarketsGreater ChinaFY24 Continuing
operations EBIT
Discontinued EBITFY24 Total Group
EBIT
($ million)
Note: For the year ended 31 July
1. Net impact of impairments in Global Markets is $193m, with impairments of $5m in FY24 and $198m in FY23
Reflects the loss
on sale of DPA
Brazil in October
2023
Improvement in
Foodservice with
higher volumes
and better margins
Improvement in
Consumer channel,
including lower
impairments¹ in FY24
FY23 benefitted
significantly from
very favourable
price relativities
FY23 includes
the gain on sale
from Soprole

Ingredients
$657
Foodservice
$138
Consumer
$324
1,755(97)
(585)
25
25
166(53)
49
83
1921,560
FY23
Continuing
operations EBIT
VolumeMarginOperating
expenses
and other
VolumeMarginOperating
expenses
and other
VolumeMarginOperating
expenses
and other
FY24
Continuing
operations EBIT
•Significant shift in composition of operating earnings between channels compared to prior year:
─Ingredients earnings $657m lower, due to narrower price relativities impacting margins and allocation of milk to higher value channels
─Foodservice earnings up $138m, due to increased sales volumes and higher margins as product prices maintained while input costs were lower
─Consumer earnings up $324m, due to higher sales volumes and increased margins. Adjusting for net impairments of $213m (FY23, $244m and FY24, 31m), underlying operating
earnings improved $111m in FY24
($ million)
Note: For the year ended 31 July. Includes Core Operations attribution

29
(136)
58
(76)
116
61
72
(50)
-200
-100
0
100
200
300
400
500
600





Note: For the year ended 31 July. Prepared on a continuing operations basis. Comparative information has been re-presented for consistency with the current period
283
552
497
223
251
216
274
157
0
100
200
300
400
500
600
700
800
900
1000
41
95
107
82
208
134
109
12
0
100
200
300
400
500
600
700
800
900
1000

Note: Figures are for the year ended 31 July and do not include normalisations. All tables exclude other operating
income, net foreign exchange gains/(losses) and share of profit/loss on equity accounted investees
1.Soprole was classed as a discontinued operation in 2023. Consequently, 2020, 2021 and 2022 was re-presented
2.2023 channel view has been re-presented for consistency with the current period
3.Impairment of $1.65 per kgMS and $0.19 per kgMS in FY23 and FY24, respectively
4.Other not included in the tables and is the reconciliation difference in calculating EBIT from Gross Profit
1,240
816
946
1,755
1,560
0.76
0.50
0.61
1.08
0.97
20202021202220232024
($ million)$/kgMS
1,026
347
813
1,555
898
0.81
0.27
0.69
1.23
0.74
20202021202220232024
$ per kgMS soldFY20FY21FY22FY23FY24
Revenue
10.82 10.72 13.1113.7712.36
Gross profit
1.180.901.422.101.61
Opex
0.740.700.850.900.93
EBIT
4
0.810.270.691.230.74
kgMS sold
1,2651,2671,1851,2651,221
Revenue
13.7314.4816.2117.6617.60
Gross profit
2.773.342.433.424.08
Opex
1.771.721.931.952.14
EBIT
4
1.041.680.571.482.01
kgMS sold
195201204219230
203
338
117
325
463
1.04
1.68
0.57
1.48
2.01
20202021202220232024
11 131 16
(125)
199
0.06
0.76
0.10
(0.85)
1.23
20202021202220232024
Revenue
16.6518.27 19.66 22.3622.80
Gross profit
4.40 5.15 4.70 5.29 5.66
Opex
3
4.27 4.42 4.30 6.28 4.55
EBIT
4
0.06 0.760.10(0.85)1.23
kgMS sold
180172156148161
•EBIT per kgMS over the last 5 years reflects
the overall lift in earnings on lower total kgMS
•In FY24 the change in EBIT per kgMS reflects
the lower volumes and price relativities in
Ingredients, partially offset by improved
margins and volumes in Foodservice
and Consumer
•The higher Consumer opex per kgMS in FY23
reflects the impairments

Continuing operations
1,577
(336)
1,241
(195)
54
68
1,168
(40)
1,128
Lower debt and
cost of funding
Decrease in tax due to
lower earnings and
higher dividend payment
FY23
Total Group
profit after tax
Discontinued
operations
profit after tax
FY23
Continuing
operations
profit after tax
Operating
earnings
Net finance
costs
TaxFY24
Continuing
operations
profit after tax
Discontinued
operations
loss after tax
FY24
Total Group
profit after tax
95c EPS
($ million)
75c EPS
70c EPS
67c EPS
Note: For the year ended 31 July. Profit after tax presented in the graph includes profit attributable to non-controlling interests. EPS presented is for profit attributable to equity holders of the Co-operative
Operating earnings down $387m
after adjusting for $192m less
impairments in FY24
$73

50.2
45.7
44.8
39.4
32.7
44.2
38.5
42.4
28.8
24.0
3.3
2.7
3.2
1.3
1.2
20202021202220232024
85
92
98
91
89
20202021202220232024
S&P Global Ratings A-Stable outlook
Fitch RatingsAStable outlook
($ billion)
6.5
5.75.7
5.1
3.9
5.2
4.3
5.3
3.2
2.6
20202021202220232024
Average debtYear-end debt
Figures presented for the Total Group
Gearing ratio (%) – Year-endGearing ratio (%) – Average
Year-end Debt to EBITDA (x)

811
805
837
1,586
1,348
12,313
12,281
12,356
12,774
11,904
20202021202220232024
Total Group net operating profit after tax ($m)Average capital employed ($m)
Return on Capital
6.6%6.6%
6.8%
12.4%
11.3%
Note: Figures presented for the Total Group
1.Comparative information has been re-presented for consistency with the current period
2.Ingredients and Consumer channels include impairments in FY22, FY23 and FY24
•Return on capital of 11.3% significantly above the 5-year average and above
the FY24 target range of 8-9%
•Average capital employed reduced due to lower working capital and
divestments and associated capital return
²
 from 16.3%
 from 15.7%
²
 from (3.9)%
¹
($ million)
Average capital employed
7,5277,9907,480
Net operating profit after tax
6761,302765
Return on Capital (%)
9.0%16.3%10.2%
Average capital employed
1,649 1,7741,984
Net operating profit after tax
91 279388
Return on Capital (%)
5.5% 15.7%19.6%
Average capital employed
2,492 2,4772,386
Net operating profit after tax
(10) (96)162
Return on Capital (%)
(0.4)% (3.9)%6.8%

Oceania
•Fonterra Oceania
Oceania
•FBNZ and
Fonterra Australia
Foodservice
Oceania
•Fonterra Australia
Ingredients
Sri Lanka
Sri Lanka
Southeast Asia
•Indonesia
•Malaysia
•Philippines
•Singapore
•Thailand
•Vietnam
Greater China
•China
•Taiwan
•Hong Kong
Rest of the World
•Americas
•Middle East
•Africa
We are exploring divestment options for Consumer and associated businesses




 
Note: For the year ended 31 July, comparative is FY23. Prepared on a continuing operations basis
Comparative changes are to FY23, and excludes impairments
In preparing the In Scope and Out of Scope breakdowns, we have applied the same principles and assumptions used in our externally published channel and segment reporting.
They reflect existing transfer pricing arrangements and Core Operations is fully attributed to the Out of Scope businesses. These breakdowns are unaudited.

-
1,000
2,000
3,000
4,000
5,000
6,000
May-22May-23May-24
per kgMS
$8.22
USD/MT
2022/23 Season
Fonterra Reference Product shipment price
The range reflects:
•recent strengthening in GDT prices and constrained milk supply in key producing regions
•maintaining wide range given early stage of the season
Note: Refer to additional information for source data and date ranges
$7.83
2023/24 Season
Average Reference Product shipment price for the season

-
1,000
2,000
3,000
4,000
5,000
6,000
Jul-22Jan-23Jul-23Jan-24Jul-24
Fonterra Non-Reference shipment priceFonterra Reference shipment price
,
,
,
USD/MT
FY24
FY23
per share
Note: Refer to additional information for source data and date ranges
The range reflects:
•an expectation that underlying performance will be similar to last year. Consumer operating profit forecast to increase through improved margins; Ingredients and Foodservice
performance expected to be stable
•higher investment in IT & digital transformation and a higher tax expense, which will generate imputation credits

•In FY24, Fonterra exhausted its New Zealand tax losses that have been used to offset its tax payable to date
•From FY25, Fonterra expects to be paying tax in New Zealand and as a result generating imputation credits
•To enable all shareholders to receive imputation credits, Fonterra is changing how it treats supply backed shares for tax purposes:
-prior to FY25, dividends on supply backed shares were treated as a business expense paid by Fonterra to farmer suppliers. This tax deduction reduces the amount of tax
payable by Fonterra but means imputation credits are not able to be attached to supply back shares
-from FY25 onwards, dividends on supply backed shares will not be deducted for tax purposes by Fonterra. This change will increase the amount of tax payable by
Fonterra but means that imputation credits will be able to be attached to dividends on all Fonterra shares and available to offset tax payable by shareholders
•These tax changes are not expected to impact the operating performance of the business, that is, no impact is expected on EBIT
•Fonterra’s higher tax expense will correspondingly reduce the reported earnings per share, that is, profit after tax per share
•The imputation credits can be attached to dividends on all shares and will be available to be used to offset tax payable at the shareholder level
•The benefit of the imputation credits will also be passed through to the Fonterra Shareholders’ Fund, and thereby to unit holders
An illustrative example is presented on the following slide

Co-operative
Profit before tax1,0001,000
Tax (28%)-(280)
Profit after tax1,000720
Earnings per share100 cents72 cents
Imputation credits-28 cents
Dividend Payout ratio100%100%
Shareholder
Gross dividend100 cents100 cents
Imputation credits-28 cents
Cash dividend100 cents72 cents
Tax payable (28%)(28) cents(28) cents
Imputation credits28 cents
Net cash for shareholder72 cents72 cents*
Higher tax reduces profit after
tax and EPS
Gross dividend is assessable for
tax. It is the sum of cash
dividend and imputation credits
Imputation credits available to
be offset against tax payable
•This example makes simplifying assumptions to
illustrate the impact of paying more tax at the Co-
op and generating imputation credits
• The example assumes:
-there are 10,000 shares
-100% of profit after tax is paid as a cash
dividend and can fully impute the dividend
-Before FY25, tax losses offset all tax
payable at the Co-op
-FY25 onwards, the Co-op pays tax at 28%
-The shareholder has an effective tax rate of
28% and can use imputation credits to offset
tax payable
•An individual shareholder’s tax position may
result in a different outcome to this example
*Tax paying shareholder with 28% tax rate receives 72
cents in both cases
Before FY25, receives higher cash dividend but pays tax
FY25 onwards, receives lower cash dividend but can use
imputation credit to offset tax payable
Generated from tax paid by the
Co-op
No change in operating
performance

Note: Figures are for the year ended 31 July and do not include normalisations, unless otherwise stated
1. Total payout for ‘a fully shared up supplier’
3,160
3,137
3,340
4,599
3,888
20202021202220232024
($ million)
4,069
4,102
3,924
3,973
3,529
20202021202220232024
('000 MT)
21.0
21.1
23.4
26.0
23.0
20202021202220232024
($ billion)
2,475
2,344
2,455
2,799
2,468
20202021202220232024
($ million)
1,517
1,539
1,478
1,480
1,471
20202021202220232024
Million kgMS
$7.14$7.54$9.30$8.22$7.83
$0.05
$0.20
$0.20
$0.50
$0.55
20202021202220232024
Milk PriceDividend
$7.19
$7.74
$9.50
$8.72
$8.38

419
545
587
668
614
106
63
30
79
106
525
608
617
747
720
20202021202220232024
CapexOther
Note: Figures are for the year ended 31 July and do not include normalisations, unless otherwise stated
1. Gearing ratio is at 31 July
1,147
959
976
2,218
1,527
20202021202220232024
($ million)
879
952
991
1,881
1,593
20202021202220232024
($ million)
659
599
583
1,577
1,128
20202021202220232024
($ million)
398
588
591
1,329
1,194
20202021202220232024
($ million)
44%
39%
42%
29%
24%
3.3x
2.7x
3.2x
1.3x
1.2x
20202021202220232024
Gearing RatioDebt to EBITDA
1

Note: Figures are for the year ended 31 July and do not include normalisations
1.Comparative information has been re-presented for consistency with the current period
2.Working capital days are presented on a 13-month rolling average basis. Inventory has been restated to reflect the inclusion of emissions trading units which were previously held as intangible assets
6.66.6
6.8
12.4
11.3
20202021202220232024
(%)
1,828
1,417
(324)
3,650
1,583
20202021202220232024
($ million)
85
92
98
91
89
20202021202220232024
(Days)
43
36 36
95
67
20202021202220232024
(cents)
24
34
35
80
71
20202021202220232024
(cents)

∆∆∆
Sales volume ('000 MT)
3,973 3,529
(11)%
3,497
3,470
(1)%
476
59
(88)%
Sales volume (million kgMS)
1,631 1,613
(1)%
1,631
1,613
(1)%
-
-
-
Revenue
26,046
22,994
(12)%
24,580
22,822
(7)%
1,466
172
(88)%
Cost of goods sold
(21,447)
(19,106)
11%
(20,399)
(19,000)
7%
(1,048)
(106)
90%
Gross profit
4,599
3,888
(15)%
4,181
3,822
(9)%
418
66
(84)%
Gross margin (%)
17.7%
16.9%
17.0%
16.7%
28.5%
38.4%
Operating expenses
(2,799)
(2,468)
12%
(2,496)
(2,369)
5%
(303)
(99)
67%
Other
3
418
107
(74)%
70
107
53%
348
-
-
EBIT
2,218
1,527 (31)%
1,755
1,560 (11)%
463
(33)-
Net finance costs
(261)
(164)
37%
(211)
(157)
26%
(50)
(7)
86%
Tax expense
(380)
(235)38%
(303)
(235)22%
(77)
- -
Profit after tax
4
1,577
1,128
(28)%
1,241
1,168
(6)%
336
(40)
-
Earnings per share (cents)
9567(29)%75
70(7)%
20
(3)-
Normalisations
5
(248)66--
--
(248)
66-
Normalised profit after tax
1,3291,194(10)%1,241
1,168(6)%
88
26(70)%
Normalised EPS (cents)
8071(11)%75
70(7)%
5
1(80)%
1.Refer to note 1a and 2c of FY24 Financial Statements
2.Percentages as shown in table may not align to the calculation of percentages based on numbers in the table
due to rounding of figures
3.Consists of other operating income, net foreign exchange gains/(losses) and share of profit or loss of equity
accounted investees
4.Includes amounts attributable to non-controlling interests
5.Normalisations in FY24 comprise of $(66)m in relation to the sale of DPA Brazil (FY23 comprises of $260m
gain on sale of Soprole, and $(12)m in relation to exiting our Hangu China farm)

1.Performance is prepared on a continuing operations basis. Comparative information has been re-presented for
consistency with the current period
2.Percentages as shown in table may not align to the calculation of percentages based on numbers in the table
due to rounding of figures
3.Consists of other operating income, net foreign exchange gains/(losses) and share of profit or loss of equity
accounted investees
∆
Sales volume ('000 MT)
3,4973,470(1)%3,0713,028426442
Sales volume (million kgMS)
1,6311,613(1)%1,4881,481143132
Revenue
24,58022,822(7)%21,79120,2222,7892,600
Cost of goods sold
(20,399)(19,000)7%(17,941)(16,664)(2,458)(2,336)
Gross profit
4,1813,822(9)%3,8503,558331264
Operating expenses
(2,496)(2,369)5%(2,252)(2,109)(244)(260)
Other
3
7010753%6993114
EBIT
1,7551,560(11)%1,6671,5428818
Net finance costs and tax expense
(514)(392)24%(464)(356)(50)(36)
Profit after tax from continuing operations
1,2411,168(6)%1,2031,18638(18)
Profit after tax from discontinued operations
336(40)---336(40)
Gross margin
17.0%16.7%17.7%17.6%11.9%10.2%
EBIT margin
7.1%6.8%7.6%7.6%3.2%0.7%

∆
1
Staff expenses²
962
9852%
Storage and distribution
263
2682%
Advertising and promotion
219
24010%
Information technology
198
2127%
IT & Digital transformation
22
81268%
Technical and professional
153
19829%
Depreciation & amortisation
180
1874%
Impairments
248
34(86)%
Other
251
164(35)%
Continuing operations operating
expenses
2,4962,369
(5)%
Discontinued operations operating
expenses
303
99(67)%
Total Group operating expenses
2,7992,468
(12)%
Note: For operating expenses by function, refer to note 3a of the 2024 Annual Financial Statements
1.Percentages as shown in table may not align to the calculation of percentages based on numbers in the table due to rounding of figures
2.Staff expenses displayed do not align to reported staff expenses in Financial Statements due to additional breakdown of IT & Digital transformation displayed in the table

•Operating expenses from continuing operations decreased $127m
•Two significant changes in FY24 relative to FY23 were the lower level of
impairments and the increased investment in IT and Digital transformation:
-impairments were $214m lower in FY24; partially offset by
-investment in IT and Digital transformation increased $59m, supporting future
efficiencies and resilience of the enterprise systems
•Removing the impact of the changes in impairments and investment in IT &
Digital transformation, operating expenses from continuing operations increased
$28m, or 1.3%, with cost savings partially offsetting the impact of inflation
Changes included:
-staff expenses increased $23m, or 2%, due to inflationary pressures and
redundancies costs;
-advertising and promotion increased $21m and supported increased sales
through the higher margin Foodservice and Consumer channels;
-technical and professional fees increased $45m mainly related to upfront
costs of delivering future efficiencies and initiatives; and
-‘Other’ expenses were down $87m due to various savings initiatives and
lower doubtful debts. FY23 was higher than previous years and reflected
higher travel and in-person engagement costs following easing of COVID
restrictions
•Operating expenses for discontinued operations decreased $204m mainly due
to the inclusion of Soprole in FY23 but not in FY24
•Research and development costs table shows a $12m decrease, mainly due to
timing of expenses in FY24. These costs are included in both operating
expenses and cost of good sold
∆
1
Total Group research and
development costs ($m)
119107(10)%

Staff expenses in cost of goods sold
1,0621,1171,1741,2671,350
Staff expenses in operating expenses
901880860963995
Total
1,9631,9972,0342,2302,345
Global milk solids collected (million kgMS)
1,6241,6451,5841,5861,578
Note: For operating expenses by function, refer to note 3a of the 2024 Annual Financial Statements
$1.47
$1.43
$1.41
$1.45
$1.49
$1.21
$1.21
$1.28
$1.41
$1.49
20202021202220232024
RealNominal
9,713
9,810
9,877
10,027
9,958
4,926
5,008
5,011
4,975
4,881
845
848
905
933
894
688
741
760
657
638
20202021202220232024
Core OperationsGlobal Markets
Group FunctionsGreater China
•The number of full time equivalent (FTE) employees has reduced as the
businesses continue to drive improved efficiencies and performance
•Total staff expenses have increased reflecting the impact of inflation
•Staff expenses per kgMS has increased reflecting the higher staff expenses
and lower kgMS collected

EBIT
1
2,218 1,527
Net finance costs
(261)(164)
Tax expense
(380)(235)
Reported profit after tax
1,577 1,128
Normalisation adjustments
2
(337)66
Tax on normalisation adjustments
89 -
Normalised profit after tax
1,329 1,194
Less: Profit attributable to non-controlling interests
(40)(54)
Normalisation adjustments attributable to non-controlling interests
- 3
Normalised profit after tax attributable to equity holder of the Co-operative
1,289 1,143
Normalised earnings per share (cents)
80 71
Final dividend per share (cents)
50 55
1.Includes continuing and discontinued operations
2.Refer to Non-GAAP Measures section in the Annual Report 2024

Other operating income
-349349--
Other operating expenses
(12)-(12)
(66)(66)
Profit before net finance costs and tax
(12)349337
(66)(66)
Net finance costs and tax
-(89)(89)
--
Profit after tax
(12)260248
(66)(66)
Profit attributable to non-controlling interests
---
(3)(3)
Profit after tax attributable to equity holders of the Co-operative
(12)260248
(69)(69)

Reported profit after tax1,5771,128
Less: Profit attributable to non-controlling interests(40)(54)
Reported profit after tax attributable to equity holders of the Co-operative1,5371,074
Reported earnings per share (cents)9567
Normalised profit after tax1,3291,194
Less: Profit attributable to non-controlling interests(40)(54)
Add: Normalisation adjustments attributable to non-controlling interests-3
Normalised profit after tax attributable to equity holder of the Co-operative 1,289
1,143
Normalised earnings per share (cents)
8071

Reported earnings¹
9567
Less: abnormal gains
(16)-
Net earnings for dividend payment²
7967
Dividend payment percentage (%) for Interim and Final
63%60%
Total dividend
5055
Interim dividend
1015
Final dividend
4025
Special dividend
-15
•Total dividend of 55 cents per share:
–Interim dividend of 15 cents,
–Final dividend of 25 cents
–Special dividend 15 cents
•The 40 cent dividend (Interim and Final) reflects a payout
ratio of 60%
•The FY24 15 cent special dividend reflects the higher
earnings over the last two years, and strengthened
balance sheet and our leverage metrics being well within
target levels
1.Attributable to equity holders of the Co-operative, excludes non-controlling interest
2.Represents net earnings as specified in the Dividend Policy and is calculated as reported profit after tax less abnormal gains
55
10
15
5
1515
40
25
15
20202021202220232024
InterimFinalSpecial

Total Group normalised EBIT
1,881
1,593
Finance income on long-term advances
11
14
Notional tax charge
(305)
(259)
Total Group normalised EBIT plus finance income on
long-term advances less notional tax charge
1,587
1,348
Capital employed at 31 July
11,121
10,912
Impact of seasonal capital employed
1,653
992
Average capital employed
12,774
11,904
Return on capital
12.4%11.3%
•FY24 return on capital of 11.3% significantly above the 5-
year average and above FY24 target range of 8-9%
•The change relative to FY23 reflects:
−lower after-tax earnings with the lower price relativities
only partially offset by improved margins in
Foodservice and Consumer and lower interest and
tax; and
−the lower earnings were partially offset by lower
average capital employed as a result of lower working
capital and divestments and the associated return
of capital

Note: Comparative information has been re-presented for consistency with the current period
Cash generated from operations​2,744​2,201​
Net change in working capital​774​112​
A. Net cash flows from operating activities​3,518​2,313​
Cash flows from investing activities​
Divestments and asset sales​841​11​
Capital expenditure and other​(709)​(741)​
B. Net cash flows from investing activities​132​(730)​
Free cash flow (A+B)3,6501,583
Dividends paid to equity holders of the Co-operative​(403)​(884)​
Capital return paid​-(804)​
Other financing cash flows​(273)​(236)​
Capital return payable accrual/reversal​(804)​804​
Other non-cash changes in net debt​(38)​139​
Decrease/(increase) in net debt2,132602
•Decrease in net debt of $0.6b reflects
continued strong operating earnings​,
disciplined capital expenditure and lower
working capital
•Free cash flow of $1.6b was $2.1b lower than
last year, which largely reflects
−underlying cash flows from earnings
decreasing by $0.5b,​
−a reduction in working capital cash flows
of $0.7b, and​
−a decrease in net cash from divestments
of $0.8b due to sale of Soprole in 2023

•The lower free cash flow in FY24 relative to FY23 reflects the lower cash earnings, change in working capital and less cash from divestments with FY23 including the sale
of Soprole. Further details are provided on the previous slide
•Year-end trade working capital (excluding suppliers’ payable) was down in FY24 with the main changes being:
−lower Receivables reflecting a reduction in days sales outstanding (DSO) with lower overdues and less sales on extended terms; and
−higher trade payables in offshore markets
•The volume of year-end inventory was down 25k MT, or 4%. The value at year-end was higher in FY24 due to the higher closing price per MT offsetting the lower volume
3,650(543)
(253)
(409)
(862)
1,583
FY23
free cash flow
EarningsSuppliers
payable
Trade and
other working
capital
Capex and
other
investing
FY24
free cash flow
($ million)
4.5
(0.2)
0.1
(0.3)
4.1
FY23ReceivablesInventoryPayablesFY24
($ billion)
Note: Comparative information has been re-presented for consistency with the current period

Note: Figures are for as at 31 July 2024
1.Includes undrawn facilities and commercialpaper. DCM is debt capital markets
2.Excludes commercial paper
3.Weighted average term to maturity (WATM)
¹
²
0.01.02.03.0
FY23
FY24
FY25
FY26
FY27
FY28
FY29
FY30
FY31
$ billion
WATM
3
: 3.0 years
Maturity Profile
0.01.02.03.0
FY23
FY24
FY25
FY26
FY27
FY28
FY29
FY30
FY31
$ billion
WATM
3
: 2.7 years
Maturity Profile
Undrawn
Facilities
$4.0bn
98%
Drawn Facilities
$0.08bn
2%
EUR DCM 8%
AUD DCM 8%
CNY DCM
3%
NZD DCM 3%
USD DCM 18%
Bank Facilities
60%

382
466
534
621
558
37
79
53
47
56
106
63
30
79
106
525
608
617
747
720
20202021202220232024
Other capital investedGrowth capital expenditure
Essential capital expenditure
249
285
281
333
291
14
36
54
51
54
15
26
78
85
40
104
119
121
152
173
382
466
534
621
558
20202021202220232024
Essential capital for other operationsDecarbonisation
WastewaterEssential capital for NZ operations
($ million)
($ million)
•Total Capital Invested was $720 million for the 2024 financial year, made up of capital expenditure of $614 million and other capital invested of $106 million
•Capital expenditure comprised $558 million of essential capital expenditure. This includes $40 million on decarbonisation projects to meet commitments to
sustainability, $54 million on wastewater assets to improve environmental footprint and $464 million on maintaining and improving our asset network in New Zealand
and globally
•$56 million was invested to supportbusinessgrowth for the Foodservice & Ingredients businesses, including capacity expansion for high value products such as
lactoferrin,probiotics and hydrolysates
•Our “Other capital invested” included our Ki Tua Equity Investment Fund, right-of-use assets and other equity investments
1.Comparative information has been re-presented for consistency with the current period

Waitoa
•Investment in biomass boiler to replace coal
Tirau
•Upgraded infrastructure to better
manage wastewater
Te Rapa
•Milk powder product transfer improvements
Hautapu
•Upgraded infrastructure to better manage
wastewater
•Change from R22 based refrigeration to a
sustainable alternative
Lichfield
•Upgrade refrigeration plant to improve
performance
Whareroa
•Improved milk powder
manufacturing and process to
reduce losses and manage
product quality risk
Stirling
•Invested in biomass boiler to replace coal
Edendale
•Investment in electrode boiler to replace coal
Sites displayed are not a full representation of all Fonterra factories
•Milk tanker replacements annual
program
•Farm vats replacements annual
program
•National distribution centers
equipment replacements annual
program
2.81
2.83
2.87
2.89
2.92
1
2
3
4
5
20202021202220232024
•Ongoing review and assessment of
asset condition and risk profile, with
targeted investment to improve
condition and manage risk
•Implementing robust maintenance
strategies with an emphasis on
quality of execution to ensure
regulatory compliance, and improve
asset stability and performance
1.Asset health indicates the assessed condition of our manufacturing assets on a scale of 1 – 5, with 1 indicating the asset is in the best condition possible

1,041
411
1,026
445
994
425
973
446
977
433
FY20FY21FY22FY23FY24
71.7%
69.7%
70.1%
68.6%
69.3%
28.3%
30.3%
29.9%
31.4%
30.7%
Reference Products
Non-Reference Products
% milk solids manufactured
(kgMS millions)
•Materially less milk was allocated to Reference portfolio in 2023 due to high whole milk
powder inventory levels and strong domestic milk production in China. 2024 allocation is a
return to a more gradual reduction in Reference portfolio allocation
•Long-term trend remains positive, allocating a greater proportion of milk solids to higher
value products in the Non-Reference portfolio
•Lower milk collections over the past 5 years has meant total milk solids processed within
the Non-Reference portfolio is relatively flat, despite the increased proportion of solids
allocated

6.8%
6.6%
6.5%
6.7%
6.9%
4.7%
5.1%
5.3%
5.2%
4.7%
4.1%
5.1%
5.2%
5.2%
6.2%
24.7%
23.0%
24.0%
25.6%
24.8%
7.7%
6.5%
7.2%
8.5%
9.1%
38.4%
39.5%
38.1%
33.7%
34.5%
•FY23 and FY24 production significantly lower than prior years due to a conscious product mix decision to
allocate away from WMP into product streams with higher value and more stable demand
•Overall, WMP demand growth has remained relatively stable over the last 3 years and the outlook
remains similar
•Strong demand for cream in the Greater China Foodservice business, particularly UHT cream, has driven
an increase in solids allocated to Non-Reference cream
•Reduced allocation of cheese due to the value of these portfolios reduces relative to the WMP and cream
portfolios, and that have experienced better pricing during the year
•Strong demand relative to supply inside the US & EU have pushed prices higher in the regions with
expectations for export demand to shift the way of Oceania, presenting a positive outlook for Oceania
prices as we move past peak supply months
•Held inventory going into the financial year. Production of casein is expected to remain at similar levels
and near-term demand sentiment remains positive
Reference Products
Non-Reference Products
(kgMS millions)
10.9%
11.4%
11.2%
12.3%
11.3%
% milk solids manufactured
Note: Excludes Butter Milk Powder, and other smaller Non-Reference commodity groups
557
112
359
159
60
68
98
581
96
338
168
75
75
98
541
102
340
159
73
75
92
478
120
363
175
74
74
95
487
128
349
159
88
66
98
Whole Milk PowderSkim Milk PowderCream
(Butter and AMF)
CheeseCream (other)CaseinOther Proteins
FY20FY21FY22FY23FY24

∆
Sales volume ('000 MT)
2,319 2,234 (4)%2,191 2,119 1,732 1,690 632 579 (2,236)(2,154)
Sales volume (million kgMS)
1,265 1,221 (3)%1,260 1,217 943 927 332 298 (1,270)(1,221)
Revenue
17,416 15,087 (13)%15,692 13,355 13,516 11,648 4,460 3,598 (16,252)(13,514)
Cost of goods sold
(14,765)(13,118)11%(14,207)(12,563)(12,584)(10,708)(4,226)(3,361)16,252 13,514
Gross profit
2,651 1,969 (26)%1,485 792 932 940 234 237 --
Operating expenses
(1,143)(1,141)-(678)(655)(403)(408)(62)(78)--
Other
3
47 70 49%16 28 31 41 - 1 --
EBIT
4
1,555 898 (42)%823 165 560 573 172 160 --
Net finance costs and tax expense
(409)(230)44%(221)(87)(149)(111)(39)(32)--
Profit after tax
1,146 668 (42)%602 78 411 462 133 128 --
Gross margin
15.2%13.1%9.5%5.9%6.9%8.1%5.2%6.6%--
EBIT margin
8.9%6.0%5.2%1.2%4.1%4.9%3.9%4.4%--
1.Ingredients performance is prepared on a continuing operations basis and includes sales to other segments.
Comparative information has been re-presented for consistency with the current period
2.Percentages as shown in table may not align to the calculation of percentages based on numbers in the table
due to rounding of figures
3.Consists of other operating income, net foreign exchange gains/(losses) and share of profit or loss of equity
accounted investees
4.Includes corporate costs for Total, Core Operations, Global Markets and Greater China of $229m, $133m,
$69m and $27m ($138m, $79m, $43m and $16m for the comparative period), respectively.

1,555(658)
(43)
54(10)
898
FY23
EBIT
Core
Operations
VolumeMarginOperating
expenses and
other
FY24
EBIT
EBIT ($ million)
Within the regions
283
552
497
223
251
216
274
157
13.9%
16.4%
17.6%
12.5%
16.2%
11.9%
13.7%
11.3%
-80.0%
-70.0%
-60.0%
-50.0%
-40.0%
-30.0%
-20.0%
-10.0%
0.0%
10. 0%
20. 0%
0
100
200
300
400
500
600
700
800
900
1000
FY23 Q1FY23 Q2FY23 Q3FY23 Q4FY24 Q1FY24 Q2FY24 Q3FY24 Q4
EBIT ($ million)Gross margin (%)
FY24
•Ingredients EBIT is down $657m, mainly due to:
–lower margins achieved in Core Operations reflecting product prices declining at a
higher rate for the Non-Reference portfolio relative to the Reference portfolio
–the FY24 lactose price declining. As a result, the benefit to Core Operations of
relatively higher lactose costs in the Milk Price calculation (due to requiring more
lactose for standardisation of WMP, SMP and BMP) has significantly reduced
–lower volumes within the regions due to providing less volume to the ONIL tender in
Middle East and Africa and cream and Whole Milk Powder to China. This was partially
offset by higher volumes of Skim Milk Powder to Atlantic and proteins to North Asia
•Gross margins tightened in the second half of FY24 reflecting the increase in the price of
Reference Products relative to Non-Reference prices
•Higher margins within the regions, mainly due to improved demand for MPC in the US
and cheese and proteins in Latin America partially offset by higher Australia milk price
Note: Prepared on a continuing operations basis. Comparative information has been re-presented for consistency with the current period

(‘000 MT)
Reference Products1,7821,744
(2)%
Non-Reference Products883891
1%
(NZD)
Reference Products ($ billion) 11.110.1
(9)%
Non-Reference products ($ billion) 7.16.4
(10)%
Reference Products ($ per MT) 6,2575,764
(8)%
Non-Reference products ($ per MT) 8,0897,145
(12)%
(NZD)
Reference Products ($ billion) 8.47.5
(11)%
Non-Reference Products ($ billion) 3.53.3
(6)%
Reference Products ($ per MT)4,6964,313
(8)%
Non-Reference Products ($ per MT)3,9743,693
(7)%
Note: Table includes Ingredients’ products that are on-sold to the Foodservice and Consumer channels and excludes bulk liquid milk. Bulk liquid milk for 2024 was 71,000 MT of kgMS equivalent (for the comparative period it was
73,000 MT of kgMS equivalent). Milk solids used in the Reference Products sold were 962 million kgMS and 458 million kgMS in the Non-Reference Products (for the comparative period 1,004 million kgMS in Reference Products and
442 million kgMS in Non-Reference Products)
•Sales volume 30,000 MT lower due to:
–38,000 MT less of Reference products due to lower milk
collections and less inventory sell down relative to prior year
–8,000 MT increase in higher value Non-Reference due to
increased allocation of milk solids
•Product prices in the Non-Reference portfolio have declined from
the highs of FY23 across most product groups, and by more,
relative to the Reference portfolio, due to cream prices increasing in
the reference portfolio
•Non-Reference portfolio cost of milk did not decline as much as the
Reference Portfolio
–The cream products in the Non-Reference portfolio are
manufactured and sold on a shorter timeframe due to their
shorter shelf life, therefore, they get expensed at a more current
milk cost
–The cost of fat, which is the primary component of the milk cost
in cream products, has increased significantly over the past
12 months

∆
Sales volume ('000 MT)
546 564 3%334 354 280 281 274 292 (342)(363)
Sales volume (million kgMS)
219 230 5%156 174 98 96 124 137 (159)(177)
Revenue
3,865 4,057 5%1,994 2,213 1,845 1,805 2,236 2,377 (2,210)(2,338)
Cost of goods sold
(3,116)(3,117)-(1,908)(2,148)(1,582)(1,463)(1,836)(1,844)2,210 2,338
Gross profit
749 940 26%86 65 263 342 400 533 --
Operating expenses
(427)(494)(16)%(89)(93)(201)(231)(137)(170)--
Other
3
3 17 467%- 6 3 11 - - --
EBIT
4
325 463 42%(3)(22)65 122 263 363 --
Net finance costs and tax expense
(92)(98)(7)%(9)(8)(23)(26)(60)(64)--
Profit after tax
233 365 57%(12)(30)42 96 203 299 --
Gross margin
19.4%23.2%4.3%2.9%14.3%18.9%17.9%22.4%--
EBIT margin
8.4%11.4%(0.2)%(1.0)%3.5%6.8%11.8%15.3%--
1.Foodservice performance is prepared on a continuing operations basis and includes sales to other segments.
Comparative information has been re-presented for consistency with the current period
2.Percentages as shown in table may not align to the calculation of percentages based on numbers in the table
due to rounding of figures
3.Consists of other operating income, net foreign exchange gains/(losses) and share of profit or loss of equity
accounted investees
4.Includes corporate costs for Total, Core Operations, Global Markets and Greater China of $57m, $8m, $23m
and $26m ($58m, $36m, $5m and $17m for the comparative period), respectively.

FY24
EBIT ($ million)
Within the regions
41
95
107
82
208
134
109
12
14.4%
19.3%
21.7%
22.0%
29.4%
23.3%
23.5%
16.0%
-80.0%
-60.0%
-40.0%
-20.0%
0.0%
20. 0%
40. 0%
0
100
200
300
400
500
600
700
800
900
1000
FY23 Q1FY23 Q2FY23 Q3FY23 Q4FY24 Q1FY24 Q2FY24 Q3FY24 Q4
EBIT ($ million)Gross margin (%)
•Foodservice EBIT is up $138m, due to:
–reduced margins within Core Operations as the rise in milk component costs during
the second half outpaced the transfer price to in-market business units
–sales volume growth of 3%, mainly driven by UHT cream sales in Greater China
–favourable in-market margins predominately driven by the lower cost of milk, as well
as the benefit from higher in-market pricing particularly in our Southeast Asia
markets
•Lower cost of milk during the first half of FY24, coupled with favourable pricing resulted
in a strong FY24 gross margin and EBIT relative to FY23
•Gross margins tightened in the second half of FY24 due to a combination of lower
prices achieved in-market and higher cost of goods sold as cost of milk increased
•As expected, gross margins tightened further in the final quarter of FY24 reflecting the
increasing price of Reference Products
•Following strong sales volumes in H1, H2 volumes reflect historical averages
Note: Prepared on a continuing operations basis. Comparative information has been re-presented for consistency with the current period
325(19)
27
185(55)
463
FY23 EBITCore
Operations
VolumeMarginOperating
expenses and
other
FY24 EBIT

∆
Sales volume ('000 MT)
632 672 6%259 268 563 606 72 73 (262)(275)
Sales volume (million kgMS)
148 161 9%108 113 135 149 13 14 (108)(115)
Revenue
3,299 3,678 11%1,456 1,409 3,040 3,365 376 394 (1,573)(1,490)
Cost of goods sold
(2,518)(2,765)(10)%(1,398)(1,363)(2,399)(2,604)(294)(288)1,573 1,490
Gross profit
781 913 17%58 46 641 761 82 106 --
Operating expenses
(926)(734)21%(73)(78)(706)(529)(147)(127)--
Other
3
20 20 -1 4 19 15 - 1 --
EBIT
4
(125)199 -(14)(28)(46)247 (65)(20)--
Net finance costs and tax expense
(13)(64)(392)%(4)(2)(22)(67)13 5 --
Profit after tax
(138)135 -(18)(30)(68)180 (52)(15)--
Gross margin
23.7%24.8%4.0%3.3%21.1%22.6%21.8%26.9%--
EBIT margin
(3.8)%5.4%(1.0)%(2.0)%(1.5)%7.3%(17.3)%(5.1)%--
1.Consumer performance is prepared on a continuing operations basis and includes sales to other segments.
Comparative information has been re-presented for consistency with the current period
2.Percentages as shown in table may not align to the calculation of percentages based on numbers in the table
due to rounding of figures
3.Consists of other operating income, net foreign exchange gains/(losses) and share of profit or loss of equity
accounted investees
4.Includes corporate costs for Total, Core Operations, Global Markets and Greater China of $67m, $17m, $42m
and $8m ($64m, $33m, $24m and $7m for the comparative period), respectively.

(125)
(14)50
94
194199
FY23 EBITCore
Operations
VolumeMarginOperating
expenses and
other
FY24 EBIT
EBIT ($ million)
Within the regions
•Consumer EBIT increased $324m, due to:
–sales volume growth of 6%, with continued demand in Sri Lanka for consumer
powders, and FBNZ demand increasing as competitors exit the mainstream yoghurt
category and tourism returned in the Pacific
–improved product mix and favourable pricing across most regions
–lower operating expenses due to $213m less impairments in FY24
•Adjusting for impairments, Consumer EBIT increased by $111m
•Lower cost of milk during FY24 Q1, coupled with favourable pricing meant a strong
FY24 Q1 gross margin and EBIT relative to FY23
•FY24 Q2 gross margins tightened relative to Q1 due to a combination of lower in-
market prices and higher cost of milk
•FY24 Q3 gross margins increased due to an improved product mix with more premium
products sold compared to Q2
•As expected, gross margins tightened in the final quarter of FY24 reflecting increasing
price of Reference Products
Note: Prepared on a continuing operations basis. Comparative information has been re-presented for consistency with the current period
29
(136)
58
(76)
116
61
72
(50)
23.8%
21.2%
25.8%
24.0%
28.8%
25.2%
26.5%
18.5%
-70.0%
-50.0%
-30.0%
-10.0%
10. 0%
30. 0%
-200
-100
0
100
200
300
400
500
600
FY23 Q1FY23 Q2FY23 Q3FY23 Q4FY24 Q1FY24 Q2FY24 Q3FY24 Q4
EBIT ($ million)Gross margin (%)
FY24

∆
Sales volume ('000 MT)
2,784 2,741 (2)%2,191 2,119 334 354 259 268
Sales volume (million kgMS)
1,524 1,504 (1)%1,260 1,217 156 174 108 113
Revenue
19,142 16,977 (11)%15,692 13,355 1,994 2,213 1,456 1,409
Cost of goods sold
(17,513)(16,074)8%(14,207)(12,563)(1,908)(2,148)(1,398)(1,363)
Gross profit
1,629 903 (45)%1,485 792 86 65 58 46
Operating expenses
(840)(826)2%(678)(655)(89)(93)(73)(78)
Other
3
17 38 124%16 28 - 6 1 4
EBIT
4
806 115 (86)%823 165 (3)(22)(14)(28)
Net finance costs and tax expense
(234)(97)59%(221)(87)(9)(8)(4)(2)
Profit after tax
57218(97)%60278(12)(30)(18)(30)
Gross margin8.5%5.3%9.5%5.9%4.3%2.9%4.0%3.3%
EBIT margin4.2%0.7%5.2%1.2%(0.2)%(1.0)%(1.0)%(2.0)%
1.Core Operations performance is prepared on a continuing operations basis and includes sales to other
segments. Comparative information has been re-presented for consistency with the current period
2.Percentages as shown in table may not align to the calculation of percentages based on numbers in the table
due to rounding of figures
3.Consists of other operating income, net foreign exchange gains/(losses) and share of profit or loss of equity
accounted investees
4.Includes corporate costs for Total, Ingredients, Foodservice and Consumer of $158m, $133m, $8m and $17m
($148m, $79m, $36m and $33m for the comparative period), respectively.

$/kgMS
$7.64
$7.52
$9.42
$9.21
$8.12
$9.27
$8.83
$10.32
$9.51
$8.12
20202021202220232024
ActualInflation adjusted
Actual ($ million)
11,16811,54813,26614,019
12,189
Compound CPI %
21.3%17.5%9.5%3.3%
Inflation adjusted ($ million)
13,55113,56814,52614,482
12,189
Core Operations sales (kgMS)
1,4611,5361,4081,523
1,501
•The gross profit from Core Operations per kgMS is calculated by
dividing the gross profit from Core Operations (excluding Farm
Source and cost of milk) by kgMS of Core Operations’ sales
•This measure of ‘gross profit’ is effectively equivalent to revenue
less the manufacturing and other costs included in COGS (as
milk cost is excluded). Therefore, the change year-on-year
reflects the change in the combination of:
-commodity prices (reflected in Revenue per kgMS); and
-manufacturing performance (reflected in Manufacturing
costs per kgMS)
-‘Other’ including net recoveries, non-cash costs and COO
farm returns.
•The chart below illustrates that almost all of the change from
FY23 to FY24 is due to the change in commodity prices and a
small improvement in Manufacturing costs per kgMS
•When evaluating the efficiency metrics, the change in
Manufacturing cost per kgMS is shown separately – see slide 15
9.21(1.19)
0.04
0.068.12
FY23 GP
per kgMS
RevenueManufacturing
cash costs
OtherFY24 GP
per kgMS

Note: Figures are prepared on a continuing operations basis.
1.Percentages as shown in table may not align to the calculation of percentages based on numbers in the
table due to rounding of figures
2.Consists of other operating income and net foreign exchange gains/(losses)
∆¹
Sales volume (‘000 MT)
379384
1%
Sales volume (million kgMS)
139135
(3)%
Revenue
2,5312,457
(3)%
Cost of goods sold
(2,237)(2,188)
2%
Gross profit ($)
294269
(9)%
Gross margin (%)
11.6%10.9%
-
Operating expenses ($)
(219)(198)
10%
Other² ($)
-8
-
EBIT ($)
7579
5%
Net finance costs and tax expense
(52)(49)
6%
Profit after tax ($)
2330
30%
•Gross profit was down reflecting the higher milk price and particularly its impact
on Ingredients, partially offset by the continued strong performance in Consumer
and Foodservice
•Revenue was down 3% due to channel mix and lower commodity prices
•Breaking down by channel:
-Consumer revenue increased by 10% year-on-year, with sales volume
increasing by 5.4% (MT) and 7.6% (kgMS), respectively
-Foodservice maintained gross profit levels, up 0.4%, in a challenging market
due to increases in inflation and less people eating out of home
-Ingredients margins were adversely impacted due to the disconnect between
global commodity prices and domestic Australian milk price through the year
•EBIT increased by 5% to $79 million due to sales volume increases and a
reduction in one-off costs in operating expenses
•In FY23, operating expenses included the $27m impact of the class action
settlement agreement with Fonterra Australia milk suppliers in relation to milk
price in the 2015/16 season
•Focused on production efficiency at manufacturing sites throughout the year. For
example, Overall Equipment Effectiveness (OEE) increased by 9% in FY24 at the
Cobden site (South West Victoria), which produces our Western Star range
of products
•Investment in automation at manufacturing sites across Victoria and Tasmania
reduced manual handling and improved efficiency
•Energy-saving initiatives delivered a 9% reduction in gas consumption in FY24

1,389
1,366
1,360
1,365
1,359
108
106106106
107
20202021202220232024
Litres (million) collectedMilk Solids Collected (kgMS)
15.8%
15.4%
15.9%
16.7%
16.2%
•Stable Australian milk collection market share and milk collection volume
throughout the year
•Optimised volumes of milk collected to meet the accurate level of demand,
while managing the volatility in the global commodity prices
•Continued to provide additional value to dairy farmers in Australia through
Fonterra’s Farm Source model
•Focused attention on supporting farmers to understand the benefits of
operating sustainably, with more than 50% now completing Farm
Environment Plans
Fonterra Australia milk collection market share %
26.0%
27.3%
27.5%27.5%
27.2%
12.0%
11.5%
12.0%
13.7%
13.3%
6.5%
6.8%6.8%
6.7%
7.0%
20202021202220232024
Western StarBegaPerfect Italiano
(by value market share
1
)
•Fonterra held the #1 position for volume and value in key branded consumer
products throughout FY24
•43% of Australian households buy Western Star, with a pack sold every
second across the country
•Bega cheese is the #1 branded cheese in Australia, followed by Perfect
Italiano at #2
1.Nielsen RMS, Total AU grocery scan MAT Aug-20 to MAT Aug-23. Comparative information has been re-presented for consistency with the current period

∆
Sales volume ('000 MT)
2,575 2,577 -1,732 1,690 280 281 563 606
Sales volume (million kgMS)
1,176 1,172 -943 927 98 96 135 149
Revenue
18,401 16,818 (9)%13,516 11,648 1,845 1,805 3,040 3,365
Cost of goods sold
(16,565)(14,775)11%(12,584)(10,708)(1,582)(1,463)(2,399)(2,604)
Gross profit
1,836 2,043 11%932 940 263 342 641 761
Operating expenses
(1,310)(1,168)11%(403)(408)(201)(231)(706)(529)
Other
3
53 67 26%31 41 3 11 19 15
EBIT
4
579 942 63%560 573 65 122 (46)247
Net finance costs and tax expense
(194)(204)(5)%(149)(111)(23)(26)(22)(67)
Profit after tax
385 738 92%411 462 42 96 (68)180
Gross margin
10.0%12.1%6.9%8.1%14.3%18.9%21.1%22.6%
EBIT margin
3.1%5.6%4.1%4.9%3.5%6.8%(1.5)%7.3%
1.Global Markets performance is prepared on a continuing operations basis and includes sales to other
segments. Comparative information has been re-presented for consistency with the current period
2.Percentages as shown in table may not align to the calculation of percentages based on numbers in the table
due to rounding of figures
3.Consists of other operating income, net foreign exchange gains/(losses) and share of profit or loss of equity
accounted investees
4.Includes corporate costs for Total, Ingredients, Foodservice and Consumer of $134m, $69m, $23m and $42m
($72m, $43m, $5m and $24m for the comparative period), respectively.

∆
Sales volume ('000 MT)
978944(3)%6325792742927273
Sales volume (million kgMS)
469449(4)%3322981241371314
Revenue
7,0726,369(10)%4,4603,5982,2362,377376394
Cost of goods sold
(6,356)(5,493)14%(4,226)(3,361)(1,836)(1,844)(294)(288)
Gross profit
71687622%23423740053382106
Operating expenses
(346)(375)(8)%(62)(78)(137)(170)(147)(127)
Other
3
-2--1---1
EBIT
4
37050336%172160263363(65)(20)
Net finance costs and tax expense
(86)(91)(6)%(39)(32)(60)(64)135
Profit after tax
28441245%133128203299(52)(15)
Gross margin
10.1%13.8%5.2%6.6%17.9%22.4%21.8%26.9%
EBIT margin
5.2%7.9%3.9%4.4%11.8%15.3%(17.3)%(5.1)%
1.Greater China performance is prepared on a continuing operations basis and includes sales to other segments.
Comparative information has been re-presented for consistency with the current period
2.Percentages as shown in table may not align to the calculation of percentages based on numbers in the table
due to rounding of figures
3.Consists of other operating income, net foreign exchange gains/(losses) and share of profit or loss of equity
accounted investees
4.Includes corporate costs for Total, Ingredients, Foodservice and Consumer of $61m, $27m, $26m and $8m
($40m, $16m, $17m and $7m for the comparative period), respectively.

∆
Sales volume ('000 MT)
2,517 2,526 -1,686 1,655 272 272 559 599
Sales volume (million kgMS)
1,162 1,164 -933 923 95 93 134 148
Revenue
17,926 16,665 (7)%13,218 11,628 1,758 1,737 2,950 3,300
Cost of goods sold
(14,911)(13,978)6%(11,176)(10,142)(1,486)(1,353)(2,249)(2,483)
Gross profit
3,015 2,687 (11)%2,042 1,486 272 384 701 817
Operating expenses
(1,882)(1,741)7%(904)(898)(221)(254)(757)(589)
Other
3
63 89 41%40 59 3 12 20 18
EBIT
4
1,196 1,035 (13)%1,178 647 54 142 (36)246
Net finance costs and tax expense
(366)(276)25%(312)(171)(24)(33)(30)(72)
Profit after tax
830 759 (9)%866 476 30 109 (66)174
Gross margin
16.8%16.1%15.4%12.8%15.5%22.1%23.8%24.8%
EBIT margin
6.7%6.2%8.9%5.6%3.1%8.2%(1.2)%7.5%
1.Global Markets performance is prepared on a continuing operations basis. Comparative information has been
re-presented for consistency with the current period
2.Percentages as shown in table may not align to the calculation of percentages based on numbers in the table
due to rounding of figures
3.Consists of other operating income, net foreign exchange gains/(losses) and share of profit or loss of equity
accounted investees
4.Includes corporate costs for Total, Ingredients, Foodservice and Consumer of $238m, $146m, $29m and $63m
($163m, $95m, $17m and $51m for the comparative period), respectively.

∆
Sales volume ('000 MT)980 944 (4)%
633579 274 292 73 73
Sales volume (million kgMS)469 449 (4)%
332 298 124 137 13 14
Revenue6,654 6,157 (7)%
4,198 3,459 2,107 2,320 349 378
Cost of goods sold(5,488)(5,022)8%
(3,589)(2,976)(1,630)(1,764)(269)(282)
Gross profit 1,166 1,135 (3)%
609 483 477 556 80 96
Operating expenses(614)(628)(2)%
(239)(243)(206)(240)(169)(145)
Other
3
7 18 157%
7 11 - 5 - 2
EBIT
4
559 525 (6)%
377 251 271 321 (89)(47)
Net finance costs and tax expense(148)(116)22%
(97)(59)(68)(65)17 8
Profit after tax411 409 -
280 192 203 256 (72)(39)
Gross margin17.5%18.4%
14.5%14.0%22.6%24.0%22.9%25.4%
EBIT margin8.4%8.5%
9.0%7.3%12.9%13.8%(25.5)%(12.4)%
1.Greater China performance is prepared on a continuing operations basis. Comparative information has been
re-presented for consistency with the current period
2.Percentages as shown in table may not align to the calculation of percentages based on numbers in the table
due to rounding of figures
3.Consists of other operating income, net foreign exchange gains/(losses) and share of profit or loss of equity
accounted investees
4.Includes corporate costs for Total, Ingredients, Foodservice and Consumer of $114m, $68m, $39m and $7m
($95m, $41m, $43m and $11m for the comparative period), respectively.

∆
¹
Sales volume ('000 MT)47659 (88)%
1
-
224
59
251
-
Sales volume (million kgMS)---
-
-
-
-
-
-
Revenue
1466
172 (88)%
15
-
599
172
852
-
Cost of goods sold
(1,048)
(106)90%
(27)
-
(405)
(106)
(616)
-
Gross profit
418
66(84)%
(12)
-
194
66
236
-
Operating expenses
(303)
(99)67%
(12)
-
(137)
(99)
(154)
-
Other
3
348
--
(1)
-
-
-
349
-
EBIT
463
(33)-
(25)
-
57
(33)
431
-
Net finance costs and tax expense
(127)
(7)94%
-
-----
Profit after tax
336
(40) -(25)-16(40) 345-
Gross margin28.5%38.4%(80.0)%-32.4%38.4%27.7%-
EBIT margin31.6%(19.2)%(166.7)%-9.5%(19.2)%50.6%-
1.Percentages as shown in the table may not align to calculations of percentages based on numbers in the table
due to rounding of figures.
2.Consists of other operating income and net foreign exchange gains/(losses)
3.Depreciation is not recognised in discontinued operations from the date at which the operations are classified
as held for sale

As at 31 July 2024, the Co-operative was within the specified thresholds for all three Flexible Shareholding metrics
•The percentage of Co-operative Shares on issue
above or below the combined Share Standard of
all Shareholders
•The threshold range is set at total Co-operative
Shares on issue being within +/- 15% of the
Share Standard
•The percentage of shares held by shareholders
who have ceased supplying milk to the
Co-operative, and/or transferred their shares to a
non-supplying person or entity in accordance
with the permitted transferee rules
•The threshold is set at no greater than 25%
•The size of the Fonterra Shareholders’ Fund has
been capped at 10% of shares on issue to
protect farmer ownership and control of
the Co-operative
Note: Movements are compared to figures as at 31 July 2023, the first publication of Flexible Shareholding metrics in the 2023 Business Performance Report
 from 12.22%
No change
 from 9.23%

Supplying Shareholders
1,329,997,79782.65%
Secondary Shareholders
3,196,4850.20%
Associated Shareholders
1,514,1500.09%
Ceased Shareholders
144,441,9028.98%
Permitted Transferees
19,609,5111.22%
Custodian shares, on behalf of the Fund
107,410,9846.67%
Custodian shares, on behalf of the Market Makers
3,019,7260.19%
Total shares on Issue1,609,190,555100.00%
To be bought
4,673,9074,846,8915,091,7894,647,6013,632,1261,819,316
-
To be sold
4,092,502-22,81845,381755,875-
-
To be bought- - - - - -
24,711,629
To be sold- - - - -
158,881,103
163,797,679

Note:
•Shareholding farms presented exclude Ceased Shareholders, Permitted Transferees, Associated
Shareholders, shareholding farms over 4x the Share Standard and includes entering supply shareholders
•Shareholdings can be less than 33% of Share Standard, under Flexible Shareholding new supplying entities
have six years to reach 33% of Share Standard
1.Milk Supply is derived from each shareholding farm’s Share Standard
# of shareholding farms
5621,0335,1371,4268,158
Milk Supply
1
(kgMS)
101,180,361201,632,511949,852,792171,735,5121,424,401,176
-
50
100
150
200
250
Number of Shareholding Farms
Percentage of Shares Held Relative to Share Standard
Shareholding farms
holding 33% of the
Share Standard
(Minimum Holding)
Shareholding farms
holding 100% of the
Share Standard
Shareholding farms
holding 4x the
Share Standard
(Maximum Holding)
-%33%66%100%150%200%250%300%350%
400%
-
5
10
15
20
25
30
35
40
45
Milk Supply
1
(million kgMS)
Percentage of Shares Held Relative to Share Standard
-%33%66%100%150%200%250%300%350%
400%
Milk supply at 33% of the
Share Standard
(Minimum Holding)
Milk supply at 100% of the
Share Standard
Milk supply at 4x the
Share Standard
(Maximum Holding)

Serious harm
8534
Genderdiversity(Band12+)
37.6%39.5%40.1%40.0%
CultureMeasure
–7979–¹
GHGemissions(Scope1,2)²
(11.2)%(14.1)%(18.5)%(15.6)%
FEPadoption(NewZealand)
71%85%93%92%
WaterImprovementPlansinplace
–44.0%100%100.0%
ShareofNewZealandmilkcollectedfortheseasonto31May79.1%79.0%78.1%79.0%
Delivered infull,ontime(DIFOT,ex-NewZealand)51.6%53.2%70.8%80.0%
CashoperatingexpensesperkgMS(real)³1.391.441.461.37
CoreOperationsgrossprofitperkgMS(real)⁴
10.329.518.128.52
Returnoncapital(FY)6.8%12.4%11.3%8.0%-9.0%
FarmgateMilkPrice($)$9.30$8.22$7.83
$7.25-$8.75⁵
Total shareholder return
(closing share price plus dividend)
$2.73
$0.20
$3.20
$1.00⁶
$2.97⁷
$0.55
NotAvailable
On-farmprofitability($perhectare)⁸
4,1503,017NotAvailableNotAvailable
1.NotargetsetforFY24.
2.RelativetoFY18Baseline.Scope1&2includingfarmsunderouroperationalcontrol.
3.Based on New Zealand milk solids.
4.Excludes the cost of milk. Based on New Zealand milk solids.
5.FY24 Scorecard reflects opening forecast price for F24 season.
6.Includes50-centpersharecapitalreturn.
7.FCG closing share price on 31 July 2024.
8.DairyNZEconomicSurvey2022-2023(Owner-Operator).

Serious harm¹181612
Percentage of Health, Safety and Wellbeing priority actions fully completed by duedate76%77%95%
Culture Measure797981
GHGemissions(Scope1,2)²(14.1)%(18.5)%(21.1)%
Absolute water reduction across manufacturing sites (15% by FY30)²(6.7)%(12.4)%(13.1)%
ShareofNewZealandmilkcollectedfortheseasonto31May79.0%78.1%78%
Delivered infull,ontime(DIFOT,ex-NewZealand)53.2%70.8%80%
CashoperatingexpensesperkgMS(real)³1.351.361.43
Core Operations manufacturing cash costs perkgMS(real)⁴
2.632.582.57
Returnoncapital(FY)12.4%11.3%8%-10%
FarmgateMilkPrice($)$8.22$7.83$7.75-$9.25
Total shareholder return
(12-month Value Weighted Average Price of Fonterra Co-operative Unit plus dividend)⁵
$2.82
$1.00
$2.58
$0.55
Not Available
On-farmprofitability($perhectare)⁶
3,017NotAvailableNot Available
1.A broader definition, which also includes Contractors, has been adopted for FY25 resulting in an increased
number of injuries captured under the revised definition.
2.RelativetoFY18Baseline.Scope1&2including farmsunderouroperationalcontrol.
3.Based on New Zealand and Australia milk solids. FY25 includes IT and digital transformationcosts.
4.Based on New Zealand milk solids collected. Excludesthecostofmilk.
5.Value Weighted Average Price (VWAP) for the period 1 October to 30 September. As an indicator for FY25, VWAP for
the 12months to 31 August 2024 was $2.58. FY23 dividend includes 50-cent per share capital return.
6.DairyNZEconomic Survey 2022-2023(Owner-Operator).

•Dairy Production and Imports
–12-month production
▪NZ, US (Aug 2023 to Aug 2024) DCANZ, USDA
▪EU, Aus (Jun 2023 to Jun 2024) Eurostat, Dairy Australia
─3-month production
▪NZ, US (Jun 2023 – Aug 2023 to Jun 2024 – Aug 2024) DCANZ, USDA
▪EU, Aus (Apr 2023 – Jun 2023 to Apr 2024 – Jun 2024) Eurostat
─12-month imports
▪LATAM, Asia (excl. China), Middle East & Africa, China (Jul 2023 to Jul 2024) S&P Global
─3-month imports
▪LATAM, Asia (excl. China), Middle East & Africa, China (May 2023 – July 2023 to May 2024 – Jul 2024) S&P Global
•Price Relativities, Forecast 2023/24 season Farmgate Milk Price and FY24 continuing operations’ earnings outlook
–Reference and Non-Reference actuals: Fonterra Free Alongside Ship (FAS) prices of the New Zealand Ingredients portfolio

Is a Shareholder that is a Farm Lessor, Sharemilker or Contract Milker
is used to indicate that a measure or sub-total excludes amounts attributable
to non-controlling interests

is a 13-month rolling average of capital employed
means bulk raw milk that has not been processed and bulk separated cream
is adjusted net debt less the cash adjustment (used in calculating adjusted
net debt), plus cash and cash equivalents held by subsidiaries for working
capital purposes, plus equity excluding hedge reserves and net deferred tax
assets

is capital expenditure plus right of use asset (e.g. leases) additions and
business acquisitions, including equity contributions, long-term advances,
and other investments

is continuing operations operating expenses, less non-cash costs
(depreciation, amortization and impairments). Shown by kilogram of New
Zealand and Australia milk solids collected

represents the channel of branded consumer products, such as powders,
yoghurts, milk, butter, and cheese

means operations of the Group that are not discontinued operations

represents core operating functions including New Zealand milk collection
and processing operations and assets, supply chain and sustainability,
Fonterra Farm Source retail stores, and the Strategy and Optimisation
function
is the cost of sales, variable and fixed costs of the COO business unit less
non-cash costs (depreciation, amortisation and impairment) shown by
kilogram of New Zealand milk solids collected. Excludes, milk, ocean freight
and farm costs

means the Fonterra Farmer Custodian, which is the legal holder of the
shares in respect of which economic rights are held for the Fonterra
Shareholders’ Fund and any Market Makers

is adjusted net debt divided by Total Group normalised earnings before
interest, tax, depreciation and amortisation (Total Group normalised EBITDA)
excluding share of profit/loss of equity accounted investees, net foreign
exchange gains/losses and any normalised EBITDA relating to entities
divested during the year

means the Dairy Industry Restructuring Act 2001, which authorised
Fonterra’s formation and regulates its activities, subsequent amendments to
the Act, and the Dairy Industry Restructuring (Raw Milk) Regulations 2012

means a component of the Group that is classified as held for sale (or has
been sold) and represents, or is part of a single coordinated plan to dispose
of, a separate major line of business or geographical area of operations, or is
a subsidiary acquired exclusively with a view to resale

represents eliminations of inter-business unit sales

means the average price paid by Fonterra in New Zealand for each kgMS
supplied by Fonterra’s farmer shareholders under Fonterra’s standard terms
of supply. The Farmgate Milk Price is set by the Board, based on the
recommendation of the Milk Price Panel. In making that recommendation,
the Panel provides assurance to the Board that the Farmgate Milk Price has
been calculated in accordance with the Farmgate Milk Price Manual
represents the channel selling to businesses that cater for out-of-home
consumption; restaurants, hotels, cafés, airports, catering companies etc.
The focus is on customers such as; bakeries, cafés, Italian restaurants, and
global quick-service restaurant chains. High performance dairy ingredients
including whipping creams, mozzarella, cream cheese and butter sheets, are
sold in alongside our business solutions under the Anchor Food
Professionals brand.

is adjusted net debt divided by total capital. Total capital is equity excluding
hedge reserves, plus adjusted net debt

represents the Ingredients, Foodservice and Consumer channels outside of
Greater China

represents the Ingredients, Foodservice and Consumer channels in Greater
China

is investments to drive business expansion or improvement toward our
strategy and generate incremental revenue. This includes organic growth
(existing business projects) and inorganic growth (mergers and acquisitions)

is Core Operations business unit gross profit excluding Farm Source and the
cost of New Zealand milk sold. Shown per kilogram of New Zealand milk
solids sold by Core Operations (continuing business)

represents the channel comprising bulk and specialty dairy products such as
milk powders, dairy fats, cheese and proteins manufactured in New Zealand,
Australia and Europe, or sourced through our global network, and sold to
food producers and distributors
means kilograms of milk solids, the measure of the amount of fat and protein
in the milk supplied to Fonterra

is a third party appointed by the Co-op who is active in making bids and
offers on a minimum number of Fonterra Co-operative Group Shares

is the maximum number of shares a Supplying Shareholder can hold, which
is equal to 4 times the Share Standard

is the minimum number of shares a Supplying Shareholder is required to
hold, which is equal to 33% of the Share Standard. New entrants have up to
six seasons to meet this

is calculated as total borrowings, plus bank overdraft, less cash and cash
equivalents, plus a cash adjustment for 25% of cash and cash equivalents
held by the Group’s subsidiaries, adjusted for derivatives used to manage
changes in hedged risks on debt instruments. Amounts relating to disposal
groups held for sale are included in the calculation

is calculated as total Group normalised EBIT plus finance income on long-
term advances less a notional tax charge
means all NZ milk solids processed by Core Operations, except for
Reference Commodity Products
means a farm where the owning entity is not entitled to hold shares in the
Cooperative. As an example, farms supplying MyMilk

means all shareholdings that are not Supplying Shareholders

means adjustments made for certain transactions that meet the requirements
of the Group’s Normalisation Policy. These transactions are typically unusual
in size and nature. Normalisation adjustments are set out in the Non-GAAP
Measures section of the financial statements.
is a person who has been approved by the Co-op and who is (and remains)
related to or associated with a Ceased Shareholder

refers to the difference in the weighted average price (in USD) between the
Reference Product portfolio and Non-Reference Product portfolio. The
difference between these two weighted average prices is a key driver of the
Ingredients’ gross margin

are the five commodity groups used to calculate the Farmgate Milk Price,
being Whole Milk Powder (WMP) and Skim Milk Powder (SMP), and their
by-products Butter, Anhydrous Milk Fat (AMF) and Buttermilk Powder (BMP)

is calculated as Total Group normalised EBIT including finance income on
long-term advances less a notional tax charge, divided by average capital
employed

New Zealand: A period of 12 months from 1 June to 31 May
Australia: A period of 12 months from 1 July to 30 June

is a sharemilker as defined in section 34 of the Co-operative Companies Act
that holds shares as if they were a Supplying Shareholder, pursuant to
section 44 of the Co-operative Companies Act and clause 30.5 of the
Constitution

means one share per one kgMS of milk supplied, used to calculate a
Supplying Shareholder's Minimum Holding and Maximum Holding

means a farm where the owning entity of the farm has a minimum required
shareholding of at least 1,000 shares in the Co-operative. This includes
farms where the owning entity is in the process of sharing up on a Share Up
Over Time contract
is a shareholder supplying milk to the Co-op

represents investments to maintain the capability of our existing assets from
risk management, legislation/regulation commitments, business continuity
and capital replacement, as well as projects that drive the Co-operative's
sustainability targets

is used to indicate that a measure or sub-total comprises continuing
operations, discontinued operations and non-controlling interests. E.g. ‘Total
Group EBIT’

means the total cash payment per milk solid that is backed by a share, being
the sum of the Farmgate Milk Price per kgMS and the dividend per share
represents shares on issue that are in excess of aggregate minimum
shareholding

is total trade and associate receivables plus inventories, less trade and
associate payables and accruals. It excludes amounts owing to suppliers
and employee entitlements and includes trade working capital classified as
held for sale

is calculated as 13-month rolling average trade working capital divided by
revenue from the sale of goods (excluding impact of derivative financial
instruments) multiplied by the number of days in the period

This presentation may contain forward-looking statements, financial targets and ambitions (“Forward Statements”), each of which is based on a range of assumptions, including (in the case of our 2030
strategy) the assumptions noted in the Appendix of the booklet titled Our Path to 2030 which is available on our website. None of the Forward Statements is intended as a forecast, estimate or projection
of the outcome that will, or is likely to, eventuate. They should not be taken as forecasts or a guarantee of returns to shareholders.
There can be no certainty of outcome in relation to the matters to which the Forward Statements relate. Our ability to achieve the outcomes described in the Forward Statements is subject to a number of
assumptions, each of which could cause the actual outcomes to be materially different from the events or results expressed or implied by such Forward Statements.
The Forward Statements also involve known and unknown risks, uncertainties and other important factors that could cause the actual outcomes to be materially different from the events or results
expressed or implied by such Forward Statements. Those risks, uncertainties, assumptions and other important factors are not all within the control of Fonterra Co-operative Group Limited (“Fonterra”)
and its subsidiaries (the “Fonterra Group”) and cannot be predicted by the Fonterra Group. The Forward Statements in this presentation reflect views held only at the date of this presentation.
While all reasonable care has been taken in the preparation of this presentation, none of Fonterra, the Fonterra Group, or any of their respective subsidiaries, affiliates and associated companies (or any
of their respective officers, employees or agents) (together “Relevant Persons”) makes any representation or gives any assurance or guarantee as to the accuracy or completeness of any information in
this presentation or the likelihood of fulfilment of any Forward Statement or any outcomes expressed or implied in any Forward Statement. Accordingly, to the maximum extent permitted by law, none of
the Relevant Persons accepts any liability whether direct or indirect, express or implied, contractual, tortious, statutory or otherwise, in respect of any Forward Statements or for any loss, howsoever
arising, from the use of this presentation.
Statements about past performance are not necessarily indicative of future performance.
Except to the extent (if any) as required by applicable law or any applicable Listing Rules (including the Fonterra Shareholders’ Market Rules), the Relevant Persons disclaim any obligation or
undertaking to update any information in this presentation.
This presentation does not constitute investment advice or opinions, or an inducement, recommendation or offer to buy or sell any securities in Fonterra or the Fonterra Shareholders’ Fund.
Fonterra uses several non-GAAP measures when discussing financial performance. Non-GAAP measures are not defined or specified by NZ IFRS.
Management believes that these measures provide useful information as they provide valuable insight on the underlying performance of the business. They may be used internally to evaluate the
underlying performance of business units and to analyse trends. These measures are not uniformly defined or utilised by all companies. Accordingly, these measures may not be comparable with
similarly titled measures used by other companies. Non-GAAP financial measures should not be viewed in isolation nor considered as a substitute for measures reported in accordance with NZ IFRS.
Non-GAAP measures are not subject to audit unless they are included in Fonterra’s audited annual financial statements.
Please refer to the non-GAAP measures section in Fonterra’s 2024 Annual Report for reconciliation of NZ IFRS to non-GAAP measures, and the Glossary for definitions of non-GAAP measures referred
to by Fonterra.

---

Annual Report 2024
Pūrongo-ā-tau Te Mātāpuna

About this report
Welcome to our Annual Report, which forms part of our end-of-year
reporting suite.
We know there are a wide range of stakeholders who are interested in
our Co-op. This year our Annual Report follows a new approach by taking
an end-to-end view of our business and how we create value for farmer
shareholders and unit holders at every step of the value chain.
This starts with our farmers’ world class milk, which our operations collect
and process for sale through our Ingredients, Foodservice and Consumer
channels. Through our focus on sustainability and innovation we aim to add
value to farmers’ milk, solve challenges, and build a more resilient Co-op.
This year our Annual Report includes the audited Financial Statements,
the Corporate Governance Statement and our first mandatory
Climate-related Disclosures.
To supplement the disclosures in the Annual Report, we have prepared a
separate Sustainability Reporting Data Pack. The Sustainability Reporting
Data Pack does not form part of the Annual Report.
In addition to the Annual Report, we have also released our
Milk Price Statement and Modern Slavery Statement.
This report covers the activities of Fonterra Co-operative Group Limited for
Financial Year 2024, commencing 1 August 2023 and ending 31 July 2024.
More information about Fonterra and our previous years’ performance can
be found here: www.fonterra.com
Brown Farm, Bay of Plenty

Contents
Annual Review4
About us
4
Chair Letter
5
CEO Letter
8
Our Strategy
10
Our Progress
11
Business Performance
27
Financial Statements33
Independent Auditor’s Report
34
Financial Statements
39
Notes to the Financial Statements
46
Governance Disclosures89
Our Board
90
Our Management Team
91
Corporate Governance Statement
92
Remuneration report
106
Directors’ disclosures
118
Statutory information
120
Climate-related Disclosures125
Governance
126
Strategy
131
Risk management
143
Metrics and targets
146
Sustainability Reporting155
Approach
156
Material Topics
162
Data Consolidation
180
Appendices181
Non-GAAP Measures
182
Financial Historical Summary
184
CRD Index
192
GRI Assurance Statement
195
GRI Content Index
198
Glossary
201
Directory
205
Andrew, Canterbury

About us
We’re a dairy Co-operative, owned and
supplied by thousands of farming families
in Aotearoa, New Zealand.
Through the spirit of co-operation and a can-do attitude, we share
the goodness of milk with customers around the world through our
Ingredients, Foodservice and Consumer channels.
We believe that food and nutrition are essential to sustain us today
and for future generations to thrive. Which is why we take great
care with every drop of milk, from farm through to customer.
Irwin Family, Waikato
4
Fonterra Annual Report 2024
ContentsAnnual ReviewFinancial StatementsSustainability ReportingGovernance DisclosuresClimate-related DisclosuresAppendices
Chair LetterCEO LetterOur StrategyOur ProgressBusiness Performance

Chair Letter
Kia ora,
Our Co-op is proud to share this set of
financial results. They are the culmination
of a huge amount of hard work put in by
everyone across the Co-op, led by Miles
and the management team who continue
to deliver consistently strong financial results,
in an increasingly volatile world.
Fonterra is an extension of our owners’ farming businesses. It exists
to provide certainty and manage risk on their behalf, while maximising
returns via a competitive and sustainable milk price, and a respectable
return on the capital they invest in Fonterra.
This informs the way we govern the Co-op. Our financial settings
and risk appetite are closely aligned to that of our farmer owners,
which has served us well in FY24 and has set a strong platform for
the year ahead.
Consistent performance
builds confidence in
our Co-op
Continuing operations earnings
before interest and tax (EBIT):
$1,560m
Peter McBride
Chair
5
Fonterra Annual Report 2024
ContentsAnnual ReviewFinancial StatementsSustainability ReportingGovernance DisclosuresClimate-related DisclosuresAppendices
Chair LetterCEO LetterOur StrategyOur ProgressBusiness Performance

Stable earnings across the Co-op
Our earnings before interest and tax (EBIT) from continuing operations
of $1,560 million was driven by stable earnings across our Ingredients,
Foodservice and Consumer channels.
Our Foodservice channel was the standout performer with a return on
capital of 19.6%. Foodservice earnings before interest and tax were up
$138 million on the previous year, at $463 million.
Overall, the team delivered a reported profit after tax of $1,168 million,
equivalent to 70 cents per share. This represents a solid return on
capital of 11.3%, which is significantly above our five-year average.
Our balance sheet remains strong due to our lower debt position and
consistent underlying performance. We finish the year with a gearing
ratio of 24% which is within our target range.
A strong balance sheet delivers benefits
Our consistent underlying financial performance gives the Board the
confidence to announce a final dividend of 25 cents, which combined
with the interim dividend of 15 cents paid earlier in the year, which is
at the top end of our payout ratio of 40-60% of net earnings.
In recognition of the Co-op’s capital management and continued
balance sheet strength, for the 2024 financial year we are also pleased
to pay an additional dividend of 15 cents per share.
Combined with the Farmgate Milk Price and interim dividend, this
brings the total cash return for the year to $8.38 per kgMS for a fully
share-aligned farmer.
The strength of our balance sheet also enabled us to make
improvements to the Advance Rate in FY24, and, as Miles announced
in August, we have made further improvements to the FY25 schedule.
The FY25 Advance Rate has been increased, with the December paid
January payment now 85%, up from 75%, and stepping up across the
rest of the season.
The objective of the uplift in Advance Rate schedule is to deliver cash
back to farmers as quickly as possible. Any dividend decisions are still
at the discretion of the Board and will be made in-line with our desire
to maintain Fonterra’s “A” band credit rating.
Divergence in the share price and unit price
A lower share price was a well-signalled potential outcome of
moving to a Flexible Shareholding capital structure and is a common
consequence of a restricted market. As only farmers can buy and sell
shares to each other, it is ultimately farmers that determine the value
of the shares.
Over the course of the financial year, the share price improved from
$2.70
1
in July 2023, to $2.97 in July 2024.
Over the same period, unit prices in the Fonterra Shareholders’ Fund
increased from $3.03
1
to $3.95.
Farmers’ cost of capital, which is typically higher than that of other
investors, is a key part of their assessment of value and is one of the
potential reasons for the divergence between the share price and unit
price. There is also potentially a liquidity discount in the restricted
share market, which we have looked to address in part through our
market maker arrangements.
The other key driver is likely cashflow on farm, which is tight as
farmers deal with high inflation on most input costs.
Strategic review
In May 2024 we announced that the Co-op was exploring options
to divest our global Consumer business, as well as Fonterra Oceania
and Sri Lanka. Divesting our Consumer business has been an ongoing
conversation for more than two decades. During FY24 we received
unsolicited interest in parts of these businesses that formed one of
the catalysts for a wider strategic review.
The world has changed. We have entered a new era of global
competition, not cooperation. It’s a more expensive, competitive
and volatile world where customer expectations are evolving, and
New Zealand milk and capital are becoming scarcer.
Having a Co-op that is aligned to our comparative advantage is
fundamental. The strategic review has clarified the parts of the
business that generate the greatest returns for farmers today, and
highlighted where we see further headroom for growth.
The full outcomes of the review will be shared with the Co-op’s
members shortly.
Having a Co-op that is
aligned to our comparative
advantage is fundamental.
1 Adjusted for the 50 cent capital return.
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Chair LetterCEO LetterOur StrategyOur ProgressBusiness Performance

Governance changes
I’d like to briefly acknowledge the governance changes that will come
into effect at this year’s Annual Meeting.
Last year just over 88% of voting farmers supported the
recommendation for our Board size to reduce from 11 down to 9. These
changes will come into effect in November this year when at the Annual
Meeting we move to a Board comprising six Farmer Elected Directors
and three Appointed Independent Directors.
At the same time, two of our long-serving Directors, Leonie Guiney and
Clinton Dines will retire from the Board, having served the maximum
nine-year term specified by our Board Charter.
On behalf of our Co-op, I’d like to thank Leonie and Clinton for their
contribution over many years. They both have a strong focus on risk and
balance sheet management that has been invaluable to our Co-op as we
reset our risk appetite and overall strategy.
A competitive outlook
The Co-op’s strong foundations give us great confidence in the
future. But that future looks increasingly competitive – both here in
New Zealand and internationally.
Our full year NZ milk collections in FY24 were 1,471 million kgMS,
down from 1,480 million kgMS in FY23. That is consistent with the
trend in New Zealand milk volumes that we expect to continue for the
foreseeable future.
Our Co-op’s scale is one of its greatest strengths. There would be
a significant impact on milk prices if we lost our scale and the cost-
efficiencies that come with it.
At the moment, our milk retention teams are competing with one arm
tied behind their backs. The Co-op needs to think about milk retention
differently and be open to giving the team more tools to support win
backs and retention.
It’s in all of our interests to maintain a strong Co-op of scale and we
look forward to continuing these conversations within the Co-op as we
close out the calendar year.
Thank you to everyone in Fonterra for your loyalty and support this year.
Our Co-op is in good heart and we are confident in our ability to
execute on strategy in FY25 and beyond.
Peter
Full year dividend
55c
per share and unit
Total cash return:
$8.38
per kgMS
The Co-op’s strong
foundations give us great
confidence in the future.
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Chair LetterCEO LetterOur StrategyOur ProgressBusiness Performance

CEO Letter
Kia ora,
I’m proud to be sharing Fonterra’s FY24
annual results which show we have
maintained momentum in our financial
performance and made meaningful progress
towards our strategic ambitions.
This result is the culmination of effort right
across the Co-op since we reset the business
in 2018. We’re in a strong position, making
now the right time to be thinking about the
future of the Co-op.
Global dairy price volatility
Looking first at our Farmgate Milk Price, the 2023/24 season was
impacted by volatility in demand from key importing regions.
We started the season with an opening forecast range of $7.25–$8.75
per kgMS, with a midpoint of $8.00. However, reduced demand from
China for whole milk powder saw the forecast price drop sharply early
in the season, before recovering somewhat to finish the season at
$7.83 per kgMS.
We utilised our balance sheet strength to make several adjustments
to the Advance Rate Schedule to get more of the milk price payment
to farmers earlier in the season.
Alongside this, we announced a further uplift to our Advance Rate
payment schedule, with farmers to be paid 10% more of the 2024/25
forecast Farmgate Milk Price from December paid January.
I’m pleased our balance sheet strength has enabled us to assist with
on-farm cash flow during this period of volatility.
Our total dividend of
55 cents per share
includes a 15 cent
interim, 25 cent final
and 15 cent per share
special dividend
Miles Hurrell
Chief Executive Officer
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Stable, resilient Co-op
Our FY24 EBIT from continuing operations of $1,560 million and profit
after tax of $1,168 million were driven by strong performance across
our Ingredients, Foodservice and Consumer channels.
We improved margins in our Foodservice channel and allocated more of
the Co-op’s milk solids to this high-performing channel. Our Consumer
channel also improved margins while lowering its operating expenses.
Our Ingredients channel earnings were down when compared to last
year’s historic highs, but overall, the channel’s earnings performance
is good.
This is a fantastic result driven by teams right across the Co-op,
delivering a return on capital of 11.3%. This result has allowed
us to pay a 15 cent interim dividend and 25 cent final dividend.
In addition, we’re pleased to be in the position to pay a special dividend
of 15 cents per share, thanks to our capital management efficiency and
ongoing balance sheet strength. This makes our total dividend for the
year 55 cents per share.
When combined with our final Farmgate Milk Price for the 2023/24
season of $7.83 per kgMS, our total payout to fully shared up farmers
is $8.38 per kgMS.
While these results are pleasing, as it shows we’re constantly delivering
on our promises, it is by no means a job completed. We need to
continually look at all areas of the business to drive for efficiencies.
Strong foundations
We made good progress in FY24 towards our ambition to maximise
value from our farmers’ milk through our strengths in sustainability
and innovation.
A key milestone for the Co-op was the launch of our Climate Roadmap,
which sets out our sustainability targets to 2030. This includes how we
intend to meet our on-farm emissions target, which we announced in
November following extensive discussion with farmers.
Our Climate Roadmap is an important tool for engaging customers,
regulatory bodies and other stakeholders on our Co-op’s sustainability
credentials and plans. Our evidence-based approach to our
sustainability claims is supporting our work with customers to grow
value for farmers from their sustainability efforts.
This year we created a new payment programme funded by
Nestlé, which will see farms that achieve any of the three levels
of The Co-operative Difference framework for the FY24 and FY25
seasons receive an additional payment of 1-2 cents per kgMS.
Mars has also supported the launch of the Greener Choices
programme, which offers discounts for Fonterra suppliers on
sustainability-linked products through our Farm Source network.
We are continuing to look for ways to strengthen our strategic
partnerships with customers who value our sustainability position,
in turn providing value back to farmers.
As we look ahead, I’m also pleased we’re commencing work to expand
manufacturing capacity for two high-value products, supporting
growing demand through our Ingredients and Foodservice channels.
The Co-op is investing around $75 million in our Studholme site to
create a hub for functional proteins, which are designed to perform
well in medical and sports nutrition.
We’re also investing around $150 million to build a new UHT cream
plant at our Edendale site to meet growing demand from China and Asia.
These two products are the result of years of innovation by the Co-op.
They are a testament to our product innovation expertise, as well as our
ability to work closely with customers to develop products that meet
their needs.
Both capital investments support our strategy to grow further value by
focusing on our high-performing Ingredients and Foodservice channels.
We have also announced a $150 million capital investment in our
Whareroa cool store to support long-term resilience of this critical part
of our supply chain network.
Another significant programme of work underway is the transformation
of our IT and digital systems. This is a once in a generation project that
will future proof the Co-op’s critical processes and systems, leading to
reduced cash costs. Work began during FY24 with further investment
forecast over the next four years.
Strategic review
During FY24, we conducted a strategic review that confirmed
our strengths in producing world-class, innovative products sold
to customers through our Ingredients and Foodservice channels.
As an outcome of this work, we announced our decision to explore
potential divestment options for our global Consumer business, as well
as Fonterra Oceania and Sri Lanka.
While these are great businesses that are performing well, we believe
releasing capital in our Consumer businesses would generate more
value for the Co-op.
When announcing the potential divestment, it was appropriate for us to
withdraw our financial targets out to 2030.
We will be releasing a revised strategy later in September, outlining the Co-
op’s strategic plans and the new set of financial outcomes we are targeting.
The revised strategy is true to our Co-operative model and our
strengths, and we believe it will create even greater value for farmers.
Outlook
Looking out to FY25, we have a forecast Farmgate Milk Price of
$8.25-$9.75 per kgMS and a forecast earnings range of 40-60 cents
per share.
The forecast earnings range reflects an expectation we will maintain
strong margins in all three of our sales channels, helping to offset some
of the impact of our investment in IT & digital transformation and
higher tax expenses.
Embedding and implementing our revised strategy, including
progressing work to assess potential divestment options for our
Consumer business, will be top priority for me and the wider Co-op
for FY25.
I look forward to sharing more detail on our plans and accelerating
work to grow even greater value for our Co-op.
Nga mihi,
Miles
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Chair LetterCEO LetterOur StrategyOur ProgressBusiness Performance

Our purpose, values & strategic choices
Our Principles
Our principles are aligned
with the Māori world view.
Manaakitanga
is the care we show for others –
it strengthens our relationships
and communities.
Kaitiakitanga
is how we care for our environment today,
tomorrow, and for future generations.
Whanaungatanga
is our Co-operative spirit it sits at the heart
of our values.
Our Values
Good Together
Better Every Day
Every Drop Counts
Our Purpose
Our Co-operative,
Empowering people,
To create goodness,
for generations.
You, me, us together,
Tātou, tātou
We’ve made key
strategic choices

Focus on New Zealand milk

Be a leader in dairy
innovation and science

Be a leader in sustainability
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AppendicesSustainability ReportingClimate-related DisclosuresCorporate GovernanceFinancial StatementsAnnual ReviewContents

Our Progress
On farm
Every year we focus on making Fonterra the first choice for
New Zealand’s dairy farmers. We do this by managing our business
well to earn the maximum sustainable return and offering farmers
the best possible support, tools, and services.
This helps to manage risk for our farmer shareholders, allowing them
to focus on their own business and producing world-class milk.
Farmgate Milk Price
The Farmgate Milk Price is the primary way farmers earn a return from
the Co-op, followed by dividends and capital distributions.
We started the 2023/24 season with a strong opening forecast of
$7.25–$8.75 per kgMS.
However, reduced demand from key importing regions saw the forecast
price drop sharply early in the season, before recovering somewhat to
end the season at $7.83 per kgMs.
We took a cautious approach when setting the opening season forecast
for the 2024/25 season at $7.25–$8.75 per kgMS.
In September 2024, we lifted the 2024/25 season forecast range
by another 50 cents to $8.25–$9.75 per kgMs off the back of
improved Global Dairy Trade prices and constrained supply from
key producing regions.
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Helping to reduce risk for farmer shareholders
Being a Co-op of scale helps manage risk for farmer shareholders.
This has many benefits, including our ability to purchase at scale and
to hedge within a given market. For example, in the current economy,
this helps reduce the prices we pay for energy and resources, allowing
us to return more money to farmer shareholders.
We remain committed to maximising the Farmgate Milk Price and
finding ways to improve on-farm cash flow to help reduce risk for
farmer shareholders.
For example, through the implementation of a revised Advance Rate
guideline for 2023/24, we were able to get more of the Farmgate
Milk Price payment to farmers earlier in the season. Changes like this
are possible thanks to our Co-op’s strong balance sheet.
We know how important the financials are for farmer shareholders,
and we are playing our part to support with tools and looking at how
we can do things better to help maximise returns.
In FY24, we made improvements to our Fixed Milk Price programme,
which is a simple price risk management tool that farmers can use to
gain greater income certainty.
The programme enables farmers to fix the price of up to 50% of
their season’s milk supply. Run once a month for 10 months of the
year, all farmers can choose to participate when it suits them and
their business.
The Fixed Milk Price benefits all suppliers as it enables the Co-op
to secure longer term contracts and provide price risk management
solutions for our customers. These solutions are key reason they
prefer Fonterra as a supplier.
In March, we announced that we were doubling the volume of milk
on offer for the year as well as introducing greater flexibility around
over-subscribed events to put us in a better position to meet farmer
demand and further strengthen relationships with key customers.
Simplifying compliance
In FY24, Farm Source launched an initiative with the goal of reducing
the time our farmers spend on compliance reporting.
The Co-op will continue to need information from farmers about
on-farm practices. This data unlocks value as it gives our products
credibility with customers to support market access.
However, there are several improvements we’ve been working on
to save farmers time, such as:
–Establishing integration with other companies such as LIC,
Ballance, and Ravensdown to enable automated sharing of data
(with farmer permission).
Scott, Canterbury
–Working closely with MPI has resulted in a significant reduction
to proposed additional requirements for all dairy farmers in
New Zealand.
–Making multiple changes to the assessment process to reduce
pressure on farmers and to make these assessments faster.
–Removing charges if farmers have completed required work by
the time of their assessment revisit.
Our Farm Source team continues to work on removing duplication and
streamlining the assessment process, with further improvements due
to be piloted during the 2024/25 season.
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Fonterra Annual Report 2024
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Chair LetterCEO LetterOur StrategyOur ProgressBusiness Performance

Sharesies – a new farmer trading experience
In June, Kiwi wealth app Sharesies became the new share trading
platform for Fonterra farmers who prefer to manage their own share
trading rather than using a stockbroker.
The previous trading platform technology had been in place since
2012 and was more limited.
Through working with Sharesies, we developed a tailored solution that
enables farmers to do things they previously couldn’t – for example
trade shares via their mobile phone, place orders without funds in
their account and receive price alerts.
We congratulate all farmers who have achieved one of the three
levels within the framework during the 2024/25 season:
This year we have made a change to how we present our
Co-operative Difference Honour roll for on-farm excellence,
shifting this update to a digital portal.
Fonterra suppliers can explore the list at: nzfarmsource.co.nz/
honourroll
Te Tihi (Summit of the mountain)
858 farmers
up from 718
Te Puku (The mid-point)
5,050 farmers
up from 5,038
Te Putake (The start of the journey)
1,429 farmers
up from 1,383
Moving to Sharesies followed testing with a pilot group of farmers
to ensure key activities such as buying and selling Co-op shares or
switching between any personal and business accounts or different
farms would be as straight forward as possible.
Within the first month, 2,500 farms signed up for a new
Sharesies account.
Overall, the partnership has enabled us to offer farmers an improved
trading experience while also helping to support liquidity under our
Flexible Shareholding capital structure that was introduced in 2023.
Co-operative Difference: Honour roll for on-farm excellence
The Co-operative Difference is our framework for enabling our
on-farm practices to support the delivery of our strategy.
It is broken down into five performance areas – environment,
animals, people & community, Co-op & prosperity, and milk.
Up to 10 cents of a farmers’ milk payment is influenced through
fulfilling the key practices within each of these areas.
In the 23/24 season 87% of Fonterra farms achieved a Co-operative
Difference Level, a 4% increase on the 22/23 season.
Drysdale Farm, Manawatū-Whanganui
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Fonterra Annual Report 2024
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Efficient operations
Every day we work to operate our manufacturing and supply chain
network safely and efficiently.
Manufacturing costs
Our cash manufacturing costs per kgMS have decreased by the
targeted 2%. This is thanks to robust performance improvement
activities and complexity reduction across our business, offsetting
the impact of higher energy costs and fewer milk solids collected
on a fixed cost base. Major simplification programmes such as Digital
Value Chain will support long-term performance improvement.
Production quality
A key indicator of operational effectiveness is the cost of quality,
which are the costs associated with not making our products right
first time.
This year’s results were adversely affected by two events relating
to product made out of specification, resulting in a downgrade
of inventory.
Our teams are focused on reducing our cost of quality through
embedding Run To Target (RTT) standardised operating practices
across all our plants and the continued focus on making product
right first time.
RTT is an internationally standardised way of working being
deployed across our manufacturing sites. It aims to enhance
operational efficiency by identifying and addressing issues earlier
and lifting operational capability, starting on the factory floor.
RTT has been rolled out to 23 sites and will cover all manufacturing
sites, depots, distribution centres, and laboratories by the end
of FY26.
We will also continue to use a risk-based quality management
programme, enhanced automated process control, and better plant
stability supported by capital investments, to maintain and improve
our quality performance.
Supply chain efficiency
We started the year with higher inventory levels than anticipated
and a disrupted domestic and global supply chain network, which
impacted our Delivered In Full On Time (DIFOT) metric.
Neil & Adriana, Te Rapa
Operations
At the heart of the Co-op is our manufacturing and supply chain
network which collects and processes milk into world-class products
to deliver to our global customers.
Our focus during FY24 has been on safety, sustainability, efficiency
and nurturing strategic partnerships.
Health, Safety & Wellbeing
The Co-op introduced a new Global Health, Safety & Wellbeing
Strategic Plan to support our continued commitment to the safety
and wellbeing of our people.
The Plan established five priorities Health, Safety and Wellbeing
priorities for our Co-op:
1.
Leadership and culture
2.
Operational learning
3.
Risk reduction and operational resilience
4.
Work and system design
5.
Support and wellbeing
Underpinning these five areas will be a culture that encourages a safe
operating mindset across our network.
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Fonterra Annual Report 2024
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Chair LetterCEO LetterOur StrategyOur ProgressBusiness Performance