Synlait's FY24 Overview

Synlait (ASX:SM1) has made significant progress in the financial year ended 31 July 2024, with a focus on deleveraging and implementing a two-step plan to reduce debt levels. The company's retail shareholders played a crucial role in supporting the $130 million shareholder loan and the raise of approximately $218 million in new equity. Synlait's Board decisions and changes were aimed at achieving a more manageable debt structure, supported by a substantial bank refinancing package. The company's Annual Report and Investor Presentation provide a comprehensive overview of its performance and progress over the past 12 months.

Executive Commentary on FY24

The past financial year has been marked by unprecedented changes and historic decisions aimed at reducing Synlait's debt levels. The support from our retail shareholders has been instrumental in driving our recovery, and we are grateful for their commitment. With the completion of the balance sheet reset and the resolution of disputes with The a2 Milk Company, Synlait is now well-positioned to focus on delivering value to all stakeholders and returning to profitability. Our strategic review has led to a shift in operations to solely focus on producing Advanced Nutrition products in the North Island, enabling us to retain milk supply and advance rates. While the headline financial results may appear disappointing, it's important to recognize the significant progress made in our business recovery plan.

FY24 Summary and Outlook

Synlait's FY24 was characterized by a strong focus on deleveraging, marked by a two-step plan and the resolution of disputes with The a2 Milk Company. The company's strategic review has led to a shift in operations to concentrate on producing Advanced Nutrition products in the North Island, while also expanding into South East Asia. Despite the headline financial results, Synlait has made significant progress in its business recovery plan and is now well-positioned to focus on further lifting performance and returning to profitability. With the balance sheet reset enabling competitive advance rates and additional one-off milk price payments, Synlait's outlook for the future is geared towards delivering value to its stakeholders and achieving a productive, profitable, and purposeful future.