But company chief executive Toni Brendish cautioned while Westland’s turnaround was the result of a year of ruthless efficiency, it didn’t stop there.
Brendish has just completed her first year at the helm.
Over the last year Westland had concentrated on overhauling its structure and business systems.
“There was a lot of excellent work going on but the company was not operating in a way that would build and sustain a prosperous future.
“To that end we looked at all aspects of our business operations and also structure,” Brendish said.
“We drove change from the very top, bringing in new leaders at senior management level while simultaneously examining every role in Westland to ensure the position was needed, working efficiently and whether the right people were in the right place to deliver on the company’s objectives.”
Westland had looked at its processes with a focus on ruthless efficiency, she said.
“Ultimately, it was costing our company a lot more to process its bucket of milk than our competitors and this had to change.”
Westland was now on track to achieve its target of $78 million in savings, equivalent to $1.20 a kilo of milksolids, through increased efficiencies and reduced costs across key areas of its operation.
“We focused on making it right first time, efficiencies in transportation and logistics, getting our sales and IT right, improving procurement processes and contracts and getting much better at sales and operating planning.”
However, the cost savings achieved could not be a one-off.
“The efficiencies and savings have to be embedded as part of the way we work and this has included a review of our strategy to ensure it was fit for purpose for the dairy market and, more specifically, the future of Westland,” she said.
In the company’s annual report Morrison said new ways of working at board and management levels had led to the change of culture.
That had projected a brighter outlook and growing shareholder confidence.
Reflecting on the 2016-17 season Morrison said extensive new thinking had come into the company with new management, a revised board structure and better ways of working.
The season had begun under considerable financial pressure and the year had been characterised by challenge and change.
“Shareholders quite rightly were demanding answers and calling for both the board and management to do much better and reverse the loss-making result of the year before,” Morrison said.
Shareholders, boosted by an industry-competitive payout prediction for 2017-18 in the $6.40 to $6.80 range, were now exhibiting more confidence in their company.
“We have a new way of working at board and management levels and this has permeated throughout the staff where I am seeing and hearing a new confidence and culture emerging.
“This is something that I believe will be reflected within our shareholder community as we restore and grow pride in our company and utilise its heritage as an asset,” Morrison said.
“Establishing our point of difference and securing our place in a growing and increasingly diverse international market is vital.”
During 2016-17 the company’s balance sheet strengthened, capital investment was carefully controlled and that, with other cash management initiatives, had allowed full repayment of all short-term debt and an improvement in the debt-equity ratio.
He also highlighted Westland’s environmental achievements, noting shareholder performance across a wide range of environmental measures had improved considerably.
“The value of this work to our company cannot be overestimated,” he said.
“Environmental compliance and sustainability is not a temporary issue that gained prominence during the 2017 general election.
“It is an issue that will be with us for a long time because it relates to our very licence to continue farming and pass our businesses and our land on to future generations.”
It also helped establish Westland’s point of difference for customers who were increasingly demanding an environmental bottom line in their audit of the company’s performance, Morrison said.
“We have worked very hard to build a great future for Westland.
“We want a future in which we’ll be proud to say we make beautiful, nourishing products and proud to be part of a dynamic company that will continue to make a vital contribution to our economy, our communities and our people,” he said.
