LOWER production and reduced sales into wholesale have weighed on results for Australia and New Zealand’s largest vertically integrated poultry processor, Ingham’s.

In results out today for the six months to December 31, the ASX-listed company showed core poultry volume at 234,200 tonnes as being down 6600t, or 2.7 percent, from 1H24.

Its key financial figures were down significantly from 1H25, with earnings before interest, taxation, depreciation, and amortisation at $210.4 million, down $43.3M, or 17.1pc, from 1H24, and a drop in net profit after tax to $51.5M, down $11.9M, or 18.8pc.

“Overall, the business is performing well, and today’s results confirm the company remains on track to achieve its FY25 volume and earnings guidance provided at the FY24 results in August 2024,” Ingham’s chief executive officer and managing director Andrew Reeves said.

“We have made significant progress in covering the reduction in volume under the new Woolworths supply agreement, with new business in Retail and QSR equivalent to approximately 75pc of the volume reduction now secured and I remain confident of further progress in the coming months.”

Ingham’s has reported its net selling price of chicken at $6.34/kg, up 8c, or 1pc, from 1H24, with Bostock Brothers in New Zealand, acquired in FY24, contributing close to one third of that price growth.

While Ingham’s core poultry volume in Australia fell 4.1pc from 1H24 to 196,400t, the New Zealand figure rose 5pc to 37,800t.

The company has reported a shift in channel mix over the half, with volume moving into retail from wholesale.

Internal feed costs declined $34M during the period, and the conversion of 102 growers to variable performance-based contracts over the past 18 months resulted in a higher operating cost impact.

Lower feed pricing has provided some benefit to Ingham’s results, with observed wheat prices declining around 10pc and soymeal around 16pc over the half.

Ingham’s said cheaper feed prices seen in 1H25, are expected to further benefit the company in 2H25, and into FY26.

“Supply chain costs remain elevated, in particular transport, offsetting some of the benefit from the
reduction of key commodity prices,” the company stated in its presentation to shareholders.

In Australia, Ingham’s retail channel growth reflects the shift toward in-home dining in response to cost-of-living pressures, increased demand for convenience products, and incremental sales growth with existing customers.

Also in Australia, quick-service restaurant volume declined in 1H25 as cost-of-living pressures drove a shift from out-of-home dining.

The drop in Australia’s core poultry volume has been put down to a temporary reduction in the number of birds processed during the period to manage both inventory levels in 2H24 and the transition to the new Woolworths supply agreement.

FY25 core poultry volume is expected to be marginally lower than FY24 due to factors including the phased introduction of the new Woolworths supply agreement, and the ongoing effects of cost-of-living pressures on consumers.

Source: Ingham’s