New Zealand dairy cooperative Fonterra has posted a full-year operating profit of $3.4 billion for the 2026 financial year, bolstered significantly by asset sales and strong operational delivery.
Financial Breakdown and Asset Sales
Total revenue for the cooperative reached $27b over the period.
Even when stripping out the Mainland divestment, underlying profit rose nearly 24 percent to $1.8b, with after-tax profit landing at $1.2b, or 71 cents per share. Fonterra had set a target to replace lost earnings from the Mainland asset sales within three years. However, the cooperative achieved that goal in just one year, prompting leadership to retire the target.
The cooperative’s return on capital reached 14.2 percent, sitting comfortably above its stated target range of 10 to 12 percent. Shareholders will receive a final fully imputed dividend of 33 cents per share, bringing the total fully imputed dividends for the year to 73 cents per share. This total includes a 24-cent interim dividend and a 16-cent special Mainland dividend paid out in April.
Payouts to Farmers and Outgoing Executive Compensation
For primary producers, the final Farmgate Milk Price for the 2025/26 season settled at $9.69 per kgMS, contributing to nearly $20b in cash returns distributed directly to New Zealand farmers throughout the year, as detailed by RNZ.
Alongside the cooperative’s financial results, financial disclosures revealed that outgoing chief executive Miles Hurrell received a total compensation package of $8,158,782 during his final financial year in the role. That total comprised a base salary of $1,915,858, a short-term incentive payout of $2,503,396, a long-term payout of $3,484,914, and roughly $250,000 in benefits including KiwiSaver.
Executive Perspective on Global Dairy Shifts
Fonterra Chief Executive Richard Allen credited the cooperative’s disciplined execution for navigating difficult international conditions.
“FY26 was a year of delivery. Our teams collected, processed and shipped near record volumes of milk, allocated products for the highest possible returns, and reliably delivered them to our customers right around the world.”
Richard Allen, Chief Executive, Fonterra
Allen noted that the cooperative faced challenging weather events and geopolitical volatility over the annual cycle, but managed to keep supply chains moving efficiently. Chairman Peter McBride praised the collective effort of the organization.
“Consistency is important to farmers and our shareholders. We’re proud of the collective effort that’s delivered another strong result, at the top end of our earnings guidance. The team hasn’t missed a beat despite the Mainland divestment process and the significant change that followed.”
Peter McBride, Chairman, Fonterra