Ridley Boosts Profit 8.7% with Fertiliser Deal in Sight

Financial Performance Highlights

Ridley Corporation Limited has delivered a commendable financial performance for the year ended 30 June 2025, with revenue climbing 3.1% to $1.303 billion. The company’s statutory net profit after tax (NPAT) increased by 8.7% to $43.3 million, reflecting operational efficiencies and volume growth across key segments.

Underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) before individually significant items rose 8.6% to $97.8 million, underscoring the strength of Ridley’s core animal nutrition and fertiliser distribution businesses. The company maintained a healthy operating cash flow of $93 million, achieving a robust 97% cash conversion rate despite a tightening economic environment.

Operational Drivers and Segment Performance

Volume growth was a key contributor, particularly in the Bulk Stockfeeds and Packaged Feeds and Ingredients segments. The Bulk Stockfeeds segment’s EBITDA increased to $47.8 million, supported by ruminant and monogastric volume gains and improved operating efficiency. Meanwhile, the Packaged Feeds and Ingredients segment posted an EBITDA of $62.9 million, benefiting from premiumisation trends in the pet food sector and operational synergies from the Oceania Meat Processors acquisition.

Ridley’s strategic exit from the Aqua sector led to some volume losses; however, this was offset by growth in other areas and the acquisition of fertiliser distribution business Incitec Pivot Fertilisers (IPF). The fertiliser segment is expected to contribute positively in FY26 as integration and efficiency gains materialise.

Balance Sheet Strength and Capital Management

The company’s balance sheet remains strong, with net cash of $64.7 million and a leverage ratio of -0.66x, reflecting prudent capital management. Ridley completed a $121.7 million capital raise during the year to partially fund the IPF acquisition, which is on track for completion by the third quarter of FY26.

Capital expenditure of $16.6 million was invested in maintenance and expansion projects, including the Clifton Feedmill and the new Oceania Meat Processors facility in Timaru, New Zealand, which is expected to open in the first half of FY26.

Dividend and Shareholder Returns

Reflecting confidence in its earnings and cash flow, Ridley declared a fully franked final dividend of 5.00 cents per share, payable in October 2025. This follows an interim dividend of 4.75 cents per share, maintaining a dividend payout ratio within the company’s target range of 50-70%.

Risks and Outlook

Ridley continues to manage risks associated with acquisition integration, commodity price volatility, foreign exchange fluctuations, and regulatory compliance. The company’s diversified portfolio across animal nutrition and fertiliser distribution helps mitigate sector-specific cyclical risks.

Looking ahead to FY26, Ridley anticipates earnings growth driven by volume expansion in the Bulk Stockfeeds segment, margin improvement in Packaged Feeds and Ingredients, and contributions from the fertiliser acquisition. The company’s ongoing capital allocation framework and strategic investments position it well for sustainable growth.