Bega Group released its FY23 results, posting a significant statutory loss after tax of $229.9m, compared to a statutory profit after tax of $24.2m in FY22 due to impacts of a $276m asset impairment in a challenging Australian milk market. Bega’s net revenue rose 12% to $3.38bn in FY23, up from $3.01bn the year before. Normalised EBITDA in FY23 was down 11% YOY to $160.2m, while statutory EBITDA was $144.1m, down from $149.9m the year prior. The bulk business unit posted $43m in EBITDA, down 28% on the prior year.
Bega processes 1.34bn litres of milk in its manufacturing network across Australia and has seen growth in brands, especially in H2 of FY23 with Bega’s market share in milk-based beverages, which includes brands like Dare and Dairy Farmers, growing to 52%. Bega accounts for 26% of the yoghurt market in Australia and 12% of the fresh milk white milk market.
Bega chairman Barry Irvin said Bega’s strategy shift to a branded business model (85% of sales in brands) had been reinforced by the industry circumstances, with the rightsizing of its commodity assets and their further integration with its branded business creating a platform for the support and growth of its brands. Bega expects normalised EBITDA in FY24 in the range of $160m – $170m.
Meanwhile, Bega has acquired Tasmania’s Betta Milk and Meander Valley Dairy Brands for $11m, subject to ACCC approval. The purchase includes a perpetual royalty-free licence to use the Pyengana Dairy brand for milk and cream products. Bega said its Tasmanian dairy business has operated in Lenah Valley since the early 1900s and the acquisition is consistent with Bega’s strategy to build its portfolio of branded product.