New Zealand dairy firm to cut costs amid record profit

Livestock Improvement Corp. (LIC), a New Zealand-based dairy herd breeding cooperative, has posted a record annual profit and plans to cut costs and has frozen salaries to prepare for bad times ahead.

Net profit rose to NZ$24.7 million in the 12 months through May, from NZ$15.6 million a year ago, thanks to the peak period in spring 2008, the cooperative said.

Sales volumes and revenue also hit record highs, rising 14 percent to NZ$150.3 million.

Chairman Stuart Bay said the good result ensures LIC is well positioned as the dairy industry progresses through the current downturn and moves into a recovery phase.

In line with financial pressures on farm, the company has initiated an extensive cost-saving programme including salary freeze, review and reduction of its capital expenditure programme and operating costs, Bay said.