Page 1

2013 ANNUAL REPORT


OUR VISION With customers at our heart we will become New Zealand’s most preferred company

OUR MISSION IS: To be number one in our service category

WE BELIEVE IN: • People drive our success • Passion for customers • Working together as one • Acting with openness and integrity

OUR CURRENT FOCUS IS: Effortless customer experiences through our people, products, platforms, processes, and operational excellence

TO DO THIS WE WILL: • Do the basics brilliantly • Know what’s valuable Invest wisely

PHOTO: Field of wild Triticum


OUR FY13 PERFORMANCE

NZ$4,576m Operating revenues and other gains

NZ$1,079m EBITDA from continuing operations

NZ$1,157m Net earnings for the year

NZ$311m Net earnings from continuing operations

61c Earnings per share

20c

OUR COMPANY

1,565k More customers

60k Growth in postpaid mobile

Dividends per share

connections

NZ$528m

NZ$169m

Capital expenditure

On-market buyback of shares


FINANCIAL CALENDAR

2012 –13 KEY DATES

Annual Meeting

Half-year result announced

Financial year end

28 September 2012

22 February 2013

30 June 2013

This report is dated 23 August 2012 and is signed on behalf of the board of Farm Science Corporation of New Zealand Limited by Jane Smith, Chairwoman, and Sam Jones, Chief Executive Officer.

Sam Jones

Wayne Smith

Chief Executive Officer

Chairman

PHOTOGRAPHY BY HANNAH ROLFE


CONTENTS

PHOTO: Local farm in Gisborne

INTRODUCTION Overview Chairman’s report CEO’s report

10 11 13

OUR COMPANY Board of directors Executive team Business operations Company review

15 18 21 33

PERFORMANCE Key Performance Indicators Business review Auditors’ reports Financial statements Notes to the financial statements

48 49 75 77 84

GOVERNANCE Governance at Farm Science Remuneration at Farm Science

135 147

DISCLOSURES Interests disclosures Shareholder and exchange disclosures

162 164

Additional shareholder information Forward-looking statements Glossary Shareholder inquiries/contact details

169 181 183 185


CHAIRMAN’S REPORT Dear Shareholder,

Along with rapid technology changes, everincreasing consumer expectations, and an

Farm Science finishes its 2012/13 financial

economy that remains flat, Farm Science is

year a substantially different company than it

presented with a number of challenges that it

was a year earlier.

must address in order to be successful.

Following the approval by more than 99%

It is testament to the people of Farm Science

of votes cast by Farm Science shareholders

that the company maintained its market

in October 2011, the company separated its

positions in all products and services

subsidiary businesses into an entirely stand

while undergoing significant change to its

alone new company called New Company.

operations, however, we are just at the start

The logic of the Demerger appears to have

of a new period of change for Farm Science.

been borne out with investors pushing

In our new world, Farm Science faces

the combined share prices of both Farm

high levels of competition in every market

Science and New Company higher. With this

segment and will only deliver the results that

transaction complete, I took over as Chairman

shareholders demand by delivering for its

of Farm Science on 1 December 2011.

customers and doing so as cost- efficiently

Post-Demerger, Farm Science is subject to

as possible. I am confident Farm Science is

a number of factors that will require it to

well placed to deliver the changes that are

fundamentally change its business over the

necessary for the Company to thrive now and

coming months and years.

into the future and your board is committed

As such, your board is focused on driving the

to driving this change on behalf of you, our

company to reshape itself to enable it to take

shareholders.

on the challenges and opportunities of this

6

substantially new operating environment.

EXECUTIVE CHANGES

The Demerger allowed for a re-set of

During the year Farm Science also said

the regulatory environment here in New

farewell to its CEO Mr Joe Smith. In his five

Zealand, which moved Farm Science closer

years at the helm of Farm Science he was

to competing on a level playing field with the

instrumental in guiding the company through

other Farm Science munications providers in

a significant period of challenge and change.

New Zealand.

In just this last year Joe and the team

A key benefit of this is that it allows for

delivered structural separation, established

a single minded focus on delivering for

ABC as New Zealand’s pre-eminent product

customers, rather than meeting regulatory

or service and strengthened Farm Science

milestones. However, separating the

’s value to New Zealand and local capital

relatively stable and high margin fixed

markets. I would like to thank Joe for his

line business into an entirely stand-alone

contribution to the Company.

company also means that cost control and

The board is delighted to have secured

efficiency become even more important than

the services of Mr Sam Jones as Joe’s

they were before.

successor. Following an extensive and robust


Farm Science Annual Report 2013

international search process, the board was unanimous that Sam is the right candidate for the role. he brings deep knowledge of Farm Science munications in New Zealand and a proven ability to lead customerfocused change to grow shareholder value. Sam started as CEO on 13 August 2013 and his compensation package is closely aligned to the delivery of shareholder value. Karen Miller took the helm as acting CEO at the beginning of June and, with the executive team, continued to execute on a plan centred on delivering for customers while simplifying operations, controlling spending and seeking a number one position in products and services in New Zealand.

Wayne Smith Chairman of Farm Science

“As such, your board is focused on driving the company to reshape itself to enable it to take on the challenges and opportunities of this substantially new operating environment.� 7


EXECUTIVE TEAM

SAM JONES

TRACY GIBSON

8


Farm Science Annual Report 2013

ABBIE GARDINER

DAVID HOLMES

NIGEL OTTO

PHOTO: Local farm in Gisborne

9


EXECUTIVE

TEAM MEMBERS

Sam Jones

Responsibilities

Background

Chief executive officer

As Chief Executive Officer (CEO) and Executive

Sam is well attuned to the Farm Science business

Director, Sam is responsible for the leadership,

having managed parts of the company in previous

strategic direction and management of the company.

roles, most recently as Chief Operating Officer during

he was appointed as Farm Science CEO in April 2012,

the years 1999–2008.

commencing mid-August of the same year.

In the intervening years, he was the CEO of Auckland International Airport for a period of four years in which the company experienced customer growth and significant uplift in its share price. Prior to this he spent 13 years in the electricity and gas industry where he held various positions, including Chief Executive of Powerco (1992 to 1999). Sam has a Master’s degree in Engineering from the University of Canterbury and a Bachelor’s degree in Science from Massey University.

Tracy Gibson

Responsibilities

Background

Group General Counsel & Company Secretary

Tracy was appointed Group General Counsel in July

Tracy is a highly experienced corporate and

2008. She leads Farm Science’s group legal and

commercial lawyer, with extensive international

corporate services team and is responsible for legal

experience in Farm Science law and regulation. After

services, internal audit, risk management, compliance,

practising law with several leading international law

corporate governance, communications, government

firms, Tracy joined Virtucom Group Plc, where she held

relations and regulatory affairs.

a number of senior leadership positions, including legal and regulatory director – Asia-Pacific Region and governance director – Europe Region, before joining Farm Science in 2008.

10


Farm Science Annual Report 2013

Nigel Otto

Responsibilities

Background

Chief Financial officer

Nigel was appointed Chief Financial Officer of Farm

Nigel has over 20 years’ experience in the financial

Science in October 2010. Nigel is responsible for

arena and after 13 years in the investment banking

the centralised finance functions of Farm Science,

industry, Nigel joined Farm Science in January 2002.

including: performance management, management

Prior to his appointment as Chief Financial Officer,

reporting, external reporting, investor relations,

he held the following positions at Farm Science

treasury and capital markets, group taxation, group

– Treasurer, General Manager Finance and Group

insurance, business unit financial support, group

Controller. Nigel has extensive capital markets,

procurement, strategy and the shared financial

mergers and acquisitions and financial experience. In

functions, including accounts payable. Nigel is also

2013, following the Farm Science Demerger, Nigel was

responsible for overall capital expenditure allocation

awarded ‘’Best CFO 2013’ at the New Zealand annual

for Farm Science.

business awards.

David Holmes

Responsibilities

Background

Group Chief Technology Officer

David joined Farm Science in October 2009 and was

UK born, David has more than 36 years’ experience in

promoted to the Farm Science Executive team in

the products industry in Europe and Asia-Pacific, with

April 2010 as Group Chief Technology Officer. he is

previous executive roles in business and technology

responsible for Farm Science’s entire network and

functions in major company operations and in

IT operations throughout New Zealand, ensuring its

professional services and technology organisations.

information technology, infrastructure and architecture

David has designed and led major change

are aligned with the Group’s business objectives. he

programmes focused on revenue growth, cost-

oversees the core technology teams in addition to

efficiency, network rollouts and ongoing management

the shared business operations, which support Farm

of insourced and outsourced operations.

Science in provisioning, credit and billing, corporate property and information management.

Abbie Gardiner

Responsibilities

Background

Chief executive officer (Ceo), retail

Abbie joined Farm Science in August 2008 as CEO of

Abbie has worked in senior sales and marketing roles

Farm Science Retail. She is responsible for driving Farm

at Home Industries and then at BD Group, eventually

Science’s commitment to improving the experience

becoming the General Manager Sales and Marketing

of Farm Science consumer and SME customers, the

for the product business. This led to a number of roles

performance of Farm Science’s products and services

offshore for Heineman and associated companies,

business with these customers and has executive

including global marketing manager for Heineman

responsibility for Farm Science’s brand.

in Antwerp and General Manager responsible for Shanghai operations for Asia-Pacific Products. Immediately prior to joining Farm Science, Abbie was in London as Managing Director of Asia-Pacific Products’ UK and European operations. Abbie has resigned from Farm Science effective 31 October 2012.

11


PHOTO: Cows patiently waiting to be tested


OPERATING ENVIRONMENT

Farm Science is a participant in the New Zealand and Australian Farm Science and information technology industries. Broadly, the Farm Science industry can be defined as fixed and mobile calling, messaging and managed and unmanaged data services. These products are delivered across a variety of platforms. Owing to the changing nature of the underlying technologies involved, the Farm Science industry is developing significant overlaps with other previously distinct industries, such as IT services, entertainment, and information services (for example, search classifieds, online trading and display).

PHOTO: Microscope in lab at Farm Science


Farm Science Annual Report 2013

The products and services industry in New

COMPETITION

Zealand and internationally is shifting

While the fundamental trends affecting

progressively to facilitate the anticipated

the products and services markets in

growth in high volume, products and

New Zealand are similar to those faced by

services. The Government’s products and

incumbent companies in mature markets,

services initiative is designed to support this

Farm Science’s position up to the Demerger

shift by assisting investment in the building

was unusual because services and regulatory

of certain assets in New Zealand. While the

changes were happening simultaneously.

timing and rate of uptake of New Zealand’s

Following the Demerger Farm Science will

products cannot be predicted with certainty,

now compete on a similar regulatory footing

it is likely that over time consumer demand

with its market peers and is subject to less

will shift from the old services and products

of the ‘product specific’regulation (including

to higher specification products and services,

Operational Separation Undertakings, price

in order to benefit from their higher quality.

regulation, extensive capital investment to

While New Zealand and Australia have similar

comply with regulated migration plans and

demographics, there are key differences

costs associated with accounting separation)

in terms of industry structure, regulation,

that existed prior to Demerger.

competition, customers, the underlying

Aside from Farm Science, the principal

economy and long-term growth rates.

players in the New Zealand product and

These differences can be attributed partly

services market are affiliates of large

to the larger size of the Australian market,

multinational corporations with substantial

the demographic mix of the Australian

resources, such as Virtucom, ClearTel and,

population and partly to the different

increasingly, large service companies such

approaches to regulation and privatisation in

as PH and BMI. Recently Virtucom has

Australia and New Zealand.

announced its intention to acquire ClearTel continued on next page >>

15


[Operating Environment] cont...

(subject to final regulatory approvals) and,

Farm Science Wholesale continues to face

once complete, the acquisition will result

increased competition in its market as further

in a combined business that competes with

exchanges and cabinets are unbundled.

Farm Science products and services. The

Price-based competition continues to

newly combined business will have assets

increase in the mass-market, with sprockets

that include widgets, gadgets, and sprockets

provided by several services players who are

in certain locations and an agreement

targeting profitable metropolitan areas, such

with ClearTel to continue to service trans-

as Auckland and other New Zealand cities.

Tasman clients. It is also expected that

Farm Science is precluded under the Services

competition across sectors will continue

Amendment Act from directly consuming

to intensify, with the prospect of existing

products for three years post-Demerger.

participants extending their activities.

New Zealand regulation for further details)

Smaller competitors in the products and

which, together with the launch of New

services sector are also actively marketing

Company’ widgets service, means that Farm

alternative products to consumer and

Science is competing for widget-based

business customers with discounted price-

business against service providers in some

based offers.

areas that are currently able to purchase

Competition in the mobile market continues

lower-cost inputs from New Company to

to increase with three primary operators,

support their sprocket and gadget services.

Farm Science, Virtucom and 2degrees

While the Government’s policy of regulation

and additional MVNOs offering services

has enabled several retail service providers

over existing mobile networks. In parallel,

to successfully enter the market, Farm

there continues to be aggressive retail

Science, as the incumbent, still remains the

price competition, with market participants

market leader in most market segments, with

offering bundles of products and services in

the exception of the services market where

an effort to increase market share.

Farm Science is number two.

16


Farm Science Annual Report 2013

Farm Science has a number of competitive advantages, including:

the number one or two positions in all core markets: Farm Science’s financial performance is underpinned by its leading position in the New Zealand Farm Science sector, being the number one service provider in all market segments other than mobile, where Farm Science is number two behind Virtucom, enabling unique and compelling converged customer propositions.

strong brands with national presence: The Farm Science brand is well established and with high recognition amongst New Zealand consumers with Farm Science having been the leading Farm Science company in New Zealand for many years. The strong Farm Science brand helps ensure that the business maintains its strong market position as number one or number two service provider.

Diversified and comprehensive product portfolio: Farm Science provides retail and wholesale products and services ranging from wholesale and international products to mass-market sprocket and widget.

large scale, strategic assets: Farm Science owns significant large scale strategic Farm Science assets encompassing an all sprockets, widgets and a 50% interest in the sprocket connecting New Zealand with international markets.

PHOTO: Grass blades

17


PHOTO: Field of Calypso bulbosa owers


OPERATING REVENUES 2013

905

LOCAL PRODUCTS

754

SERVICES

104

WIDGETS

904

GADGETS

454

BROADBAND & INTERNET

544

OTHER SERVICES

143 187

RESALE OTHER OPERATING REVENUES

54

OTHER GAINS

1000

900

800

700

600

500

400

300

200

100

0

DOLLARS IN MILLIONS (NZ$M)

797

LABOUR

1160

INTERCARRIER COSTS

1535

OTHER OPERATING EXPENSES

5

OTHER EXPENSES

363

DEPRECIATION

213

AMORTISATION

26

FINAL INCOME

106 80

500

20

SHARE OF ASSOCIATE’S NET PROFIT/(LOSSES)

0

OPERATING EXPENSES 2013

-250

-500

-750

-1000

-1250

-1500

-1750

-2000

DOLLARS IN MILLIONS (NZ$M)

FINAL EXPENSE


Farm Science Annual Report 2013

OPERATING REVENUES 2013

Resale Other Gains Other Operating Revenue

Other Services

Broadband and Internet

Local Products

Gadgets

Services International Widgets

2011 $5,177M

2012 $5,004M

2013 $4,576M

OPERATING REVENUES COMPARISON

21


AUSTRALIAN COMPETITIVE ENVIRONMENT The Australian Government has commenced

On 27 February 2012 the Australian

a widget initiative for an estimated A$39.5

Competition and Consumer Commission

billion national sprocket (NNS). The NNS

(ACCC) accepted ClearTel’s structural

rollout is driving a significant amount of

separation undertaking (SSU) and approved

market consolidation. To create a more

the accompanying migration plan. The

transparent and competitive environment

SSU implements a migration model of

before the NNS rollout is complete, ClearTel

structural separation in which ClearTel will

is required to structurally separate.

progressively decommission its sprocket factories and instead use the wholesale-only NNS to supply downstream products, as the NNS is built. Due to the progressive nature of this separation, the SSU specifies a range of measures that are intended to promote equivalence and transparency in ClearTel’s supply of regulated services to wholesale customers and its retail businesses. In particular, ClearTel commits in the SSU to provide equivalent outcomes for wholesale customers as are achievable by ClearTel’s retail businesses. ClearTel continues to be vertically integrated in relation to its ownership of passive infrastructure that

PHOTO: Local Brisbane farm

22

will be relevant to the supply of NBN-based services (which includes 111 of the 121


Farm Science Annual Report 2013

NNS points of interconnections (POI) sites

ClearTel and Optus are AUSCO’s main

located in ClearTel exchange buildings

competitors in the business and wholesale

and underground facilities, such as ducts,

voice, data and internet market. The

pits and manholes leading into those POI

local calling market remains dominated

sites). This raised concerns that ClearTel

by ClearTel, as it owns most of the

would have ongoing incentives and the

Australian sprockets until that market is

ability to discriminate against access

decommissioned in the transition to the NNS.

seekers. The SSU contains arrangements

Interconnection with ClearTel’s sprocket is

for AUSCO and other competitors to

necessary for competition, including AUSCO,

access the passive infrastructure, including

to offer many services and AUSCO therefore

provisions to manage order queues and

relies on the Australian competition regulator

common construction works. However, the

to obtain access. There is significant

arrangements:

competition in the provision of products and services and widgets, gadgets and sprockets.

allow ClearTel to reserve space in its

Price reductions, which have already been

facilities for its own genuine anticipated

seen in the market for widgets and sprockets,

requirements and to reject an order from

are expected to continue.

an access seeker where such capacity has been reserved; and •

only apply for the purpose of interconnection with ClearTel’s active declared services and do not extend to interconnection with the NNS.

$39.5 billion NATIONAL SPROCKET

23


CUSTOMERS Farm Science’s mission is to become number one in products and services in New Zealand. Farm Science’s vision is to achieve this by putting customers at the heart of its business and, in doing so, become New Zealand’s most preferred company.

FARM SCIENCE PROVIDES PRODUCTS AND SERVICES TO RETAIL AND WHOLESALE CUSTOMERS WITH:

1 million

over residential and SME customers in New Zealand;

1.5 million

over connections (consumer and business) in New Zealand;

over

800,000 customers in

New Zealand;

70

wholesale customers in New around Zealand, comprising mainly retail service providers;

24


Farm Science Annual Report 2013

200 international wholesale and retail providers

across the world, in addition to

providing outsourced international sprockets for other sprocket providers, gadgets globally and widget companies

in Europe and the United States;

around 2,800 business clients across Australasia over 4,000 businesses supplied with sprockets; and over 6,000 business and 300 wholesale customers in Australia using AUSCO’s services. Farm Science now has four customer-facing business units: Retail, Wholesale & International and AUSCO, and further details on their customers can be found within these respective business unit sections in the organisational structure section on the following page. Details on Farm Science’s key product and service markets can be found in the Industry and sub-sector outlook section on the following pages.

25


SALES & MARKETING CHANNELS

Farm Science utilises a number of key channels to deliver its range of products and services to customers.

THESE INCLUDE: Farm Science Retail’s network of more than 65 stores in New Zealand, made up of 33 Farm Science-owned retail stores, as well as 83 dealer outlets dedicated to Farm Science products and services. Included within the 83 dealer outlets are 30 Farm Science business hubs in local regions around New Zealand to support customers with business service needs. Farm Science Retail’s digital platforms to communicate with its customers. Farm Science’s primary website, farmscience. co.nz, receives over 650,000 unique visitors every month and was revamped in FY13 to improve customer experience, particularly to make it easier for customers to research and buy mobile devices. Farm Science Retail has approximately 1,050 service representatives staffing its New Zealand-based sales and support helpdesks (either based in contact centres or as agents at home). Phones are answered 24 hours a day, every day of the year. Farm Science also uses offshore customer support services to provide diversity and technical expertise to customers. Call centres remain an important channel for customer interaction and for inbound sales inquiries and frontline sales opportunities.

26


Farm Science Annual Report 2013

Other important and developing channels for retail customer interaction, such as online channels and on-device service functions. Customers are able to initiate a range of self-service functions on Farm Science’s website, as well as on their mobile devices.

Farm Science Retail’s focus on sharing advice and insights with small business customers via social media and direct mail activities, while also participating in industry associations.

In Australia, AUSCO wholesale focuses on developing alignment

Wholesale dealing direct with its

with key players in the market and

retail service providers through

building on existing relationships

its own sales and service channels

with strategic customers and

but has an arrangement with

partners by leveraging investment

New Company for a subset of

in next generation products.

services (including sprocket resale

AUSCO’s business teams work

and legacy gadgets) where New

directly with customers, and

Company fronts the relationship

potential customers, to develop

with service providers as agent for

and satisfy their requirements by

Wholesale.

building tailored solutions.

27


PHOTO: Apis mellifera retrieving pollen


INDUSTRY TRENDS AND CORPORATE STRATEGY

The global product and service industry continues to evolve rapidly, with the development of new technologies and sources of competition and further convergence with other industries. The manner in which communications, entertainment and services are consumed is fundamentally changing, thereby creating both opportunities and risks for existing business models in the this sector.

The fundamental trends affecting

In response to these market conditions,

the products and services markets

and in light of the Government-led strategy

in New Zealand are similar to

initiative, pre-Demerger Farm Science

those faced globally by incumbent

developed a strategy to reflect its increasingly

companies in mature markets and

challenging operating environment, as well

include:

as ensuring it was appropriately structured to compete in the future. Known as

• • •

rapid growth in usage of

Strategy2013, this strategy was designed

products and services;

to bolster Farm Science’s existing value

flat revenues in the overall

retention, deliver simplification and accelerate

market;

cost reduction and growth plans.

increasing competitive intensity across all products and services markets;

a growing preference for internet-enabled services in each of the mass-market, SME and corporate sectors; and

globalisation of technology manufacturers and increased focus on open platformenabled solutions.

continued on next spread >>

30


Farm Science Annual Report 2013

31


[Industry Trends and Corporate Strategy] cont...

STRATEGY 2013 The Strategy2013 strategy is focused on four key themes, which are:

ENABLERS:

OPERATIONAL EXCELLENCE:

Delivering changes to Farm Science’s

Reducing failure rates and simplifying

operating model and structural design to

the business in order to deliver improved

better enable the transition to the post-

customer experience, sustainably lower

Demerger environment.

operating costs and increased returns from capital investment.

MARKET STRATEGY:

COMMERCIAL EXCELLENCE:

Exiting non-core markets and focusing

Driving a focus on customer satisfaction,

investment in new or existing markets with

customer retention and margin improvement

higher returns and growth opportunities.

from the delivery of new gadget, widget and sprocket customer oerings.

32


Farm Science Annual Report 2013

Farm Science’s operational excellence

services. Farm Science’s churn-reduction

activities target operating expenses and

programme will be enabled by innovative

capital expenditure efficiency through

commercial bundles of fixed line, mobile

simplifying its products and platforms and

communication and value-added IP services

reducing personnel costs. Operational

packages. In FY13 Farm Science has

excellence is also expected to deliver process

continued to drive penetration of bundled

simplification and a reduction in errors

consumer and SME packages, focused its

and re-work. As well as lowering costs,

resources on targeting high-value mobile

this is expected to drive improvements in

market segments and has re-signed some

customer experience. In FY13 Farm Science

key ICT business customers.

re-engineered certain key operational

These operational and commercial initiatives

processes, initially within gadgets , sprockets

will be supported by further investment

and widgets, re-negotiated certain supplier

in Farm Science’s customer satisfaction

contracts to improve service delivery and

initiatives, such as‘Right First Time’,which

reduce costs and delivered cost benefits from

systematically identifies and removes

insourcing previously outsourced support

sources of inefficient service delivery and

functions.

customer pain points. In the longer term,

Farm Science’s commercial excellence

Farm Science aims to deliver revenue

activities target improvement of margins

growth, possibly by exploring opportunities

across the product portfolio by lowering

to enter new adjacent markets, such

costs within its customer operations and

as entertainment, financial services or

growing revenue through new products and

consumer payments.

33


PHOTO: Hydrocotyle moschata plant


INCOME STATEMENTS FOR THE YEARS ENDED

30 JUNE 2013, 2012, 2011

Year ended 30 June

2013

2012

2011

NZ$M

NZ$M

NZ$M

Local Products

905

955

1004

Services

754

928

1003

Widgets

104

195

178

Gadgets

904

825

826

527

574

626

Broadband and Internet

454

487

511

Other Services

544

561

486

Resale

143

235

278

Other Operating Revenue

187

199

238

54

45

27

4,576

5,004

5,177

(Dollars in millions, except per share amounts)

Notes

Operating revenues and other gains (continuing operations)

Other Gains TOTAL

36

3


Farm Science Annual Report 2013

Year ended 30 June

2013

2012

2011

Notes

NZ$M

NZ$M

NZ$M

5

(797)

(832)

(858)

Intercarrier costs

(1,160)

(1,559)

(1,594)

Other operating expenses

(1,535)

(1,595)

(1,809)

(Dollars in millions, except per share amounts)

Operating expenses (continuing operations) Labour

Asset Impairments Other expenses Depreciation Amortisation

-

(215)

-

(5)

(42)

-

(363)

(468)

(527)

(213)

(240)

(245)

(4,073)

(4,951)

(5,033)

Finance Income

7

26

15

22

Finance Expense

7

(106)

(152)

(151)

Share of associate’s net proďŹ ts/(losses)

-

1

1

(80)

(136)

(128)

423

(83)

16

(112)

4

(10)

Net earnings/(loss) for the year (continuing operations)

311

(79)

6

Net earnings for the year (discontinued operations)

846

245

376

1,157

166

382

1,155

164

380

2

2

2

Basic net earnings per share

0.60

0.09

0.20

Diluted net earnings per share

0.60

0.09

0.20

0.16

(0.04)

-

1,918

1,924

1,891

Net earnings before income tax (continuing operations) Income tax (expense)/credit

Net earnings for the year Net earnings for the year is attributable to: Equity holders of the company Non-controlling interests Earnings per share (in New Zealand dollars)

10

Basic and diluted earnings/(loss) per share from continuing operations Weighted average number of ordinary shares

37


END OF REPORT


Farm Science Annual Report  

Annual report mockup design