Farm Pride Reports 27% Production Increase, $3.6M Operating Cash Inflows
Farm Pride Foods reports a 27% production surge supported by avian influenza recovery and secures $27.6 million financing for facility upgrades and expansion.
- 27% production increase driven by flock replacements post-avian influenza
- New $27.568 million financing facility with NAB, $12 million used to repay debt
- Operating cash inflows of $3.611 million, customer receipts up 18%
- Capital expenditure focused on biosecurity, production, and grading upgrades
- Cash on hand $8.3 million with $15.568 million unused financing available
Production Recovery and Growth
Farm Pride Foods Limited has reported a significant 27% increase in egg production for the quarter ended 30 June 2025, a strong rebound attributed to the replacement of flocks following the challenges posed by avian influenza earlier in the year. This recovery has underpinned improved operating cash inflows, with receipts from customers rising 18% compared to the previous quarter, reflecting both volume growth and sustained demand.
Strategic Financing and Capital Investment
The company secured a new consolidated financing facility totaling $27.568 million with National Australia Bank. Of this, $12 million was allocated to repay existing debt, while the remainder is earmarked for capital projects at the Keysborough and Greendale processing facilities and farms. These investments focus on upgrading production and grading infrastructure, as well as enhancing biosecurity measures, which remain a critical priority given the recent influenza outbreak.
Managing Cost Pressures
Farm Pride continues to navigate a challenging cost environment, with significant expenditure directed towards biosecurity upgrades and capacity improvements. The company plans to increase capital expenditure by approximately $0.5 million in July to further enhance operational efficiency and hen rearing capabilities. Despite these pressures, the company maintains a healthy cash position of $8.3 million at quarter-end, complemented by $15.568 million in unused financing facilities, providing a solid liquidity buffer.
Market Position and Sustainability
Farm Pride remains committed to its vertically integrated business model, supplying a range of egg products including free-range eggs to supermarkets and industrial manufacturers. The company also emphasizes sustainability, being the only Australian egg producer manufacturing its own cartons from recycled materials. Strong relationships with retail and industrial partners underpin its market position as it continues to develop its product offerings to meet evolving consumer preferences.
Outlook
While the company is optimistic about its production recovery and growth prospects, it acknowledges ongoing cost pressures and the need for continued investment in biosecurity and operational capacity. The successful execution of its capital projects and cost management strategies will be key to sustaining momentum in the coming quarters.
Bottom Line?
Farm Pride’s strengthened balance sheet and production rebound set the stage for growth, but cost pressures and biosecurity remain watchpoints.
Questions in the middle?
- How will the planned capital expenditure impact production efficiency and margins?
- What is the company’s strategy to mitigate ongoing biosecurity risks?
- How sustainable is the recent production growth amid fluctuating market demand?
