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Dairy Brands considers farm sell-off

By Phil Boeyen, ShareChat Business News Editor

Friday 17th November 2000

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Listed milk producer Dairy Brands is considering selling its remaining farms to capitalise on high dairy property prices.

Two of the company's 14 irrigated dairy farms are due to be sold by auction next week. The properties are located in Canterbury and North Otago.

When the company announced it was selling its Murrayfields and Pukeuri farms it said the sales were consistent with its policy over the last few years of developing its role as a farmer and not just a property owner.

Dairy Brands' directors say selling the remaining farms will maximise shareholder value, given that the company's share price continues to trade at a discount to the underlying value of the properties.

The philosophy follows in the tracks of another corporate dairy farmer, Tasman Agriculture, which has also been taking advantage of demand for dairy land to sell off a number of its properties.

At its full-year announcement in August Dairy Brands posted a profit of $1.7 million compared to last year's loss of $1.9 million. Operating profit was $86,000, while revaluation of some farm properties accounted for $1.6 million of the surplus.

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