Bega Cheese Delivers Strong First Half with Branded Growth and Bulk Recovery

Bega Cheese (ASX: BGA) has kicked off FY2025 with a solid financial performance, posting a 27% jump in statutory EBITDA to $109.3 million for the first half. Despite a challenging consumer environment, the Branded segment continued to grow, while the Bulk segment returned to profitability, marking a significant turnaround from the prior year.

Key Financial Highlights (1H FY2025 vs. 1H FY2024)

  • Revenue rose 3% to $1.78 billion, driven by a recovery in Bulk.
  • Statutory EBITDA increased 27% to $109.3 million.
  • Normalised EBITDA surged 44% to $110.3 million, reflecting strong operational improvements.
  • Net profit after tax (PAT) climbed 14% to $30.2 million on a statutory basis and 170% to $35.9 million on a normalised basis.
  • Net debt reduced by $43.7 million, with the leverage ratio improving from 1.9x to 1.3x.

Branded Segment Delivers Growth Despite Consumer Pressure

Bega’s Branded segment delivered an 8% increase in normalised EBITDA, despite consumers tightening their belts. The company credited innovation, cost savings, and a focus on high-value categories for its ability to grow volumes and revenue in a challenging retail environment.

Bulk Segment Returns to Profitability

The Bulk segment bounced back, reporting a statutory EBITDA profit of $24.4 million, a major turnaround from last year’s $5.6 million loss. The recovery was driven by improved dairy commodity pricing and a strategic shift toward higher-value proteins, alongside strong cost-saving initiatives.

Stronger Balance Sheet and Dividend Announcement

With net debt dropping to $207.2 million, Bega’s balance sheet is in a much stronger position. The company also announced a fully franked interim dividend of 6.0 cents per share, to be paid on April 3, 2025, with the Dividend Reinvestment Plan activated.

Outlook for FY2025

Bega remains optimistic for the rest of FY2025, with its Branded business continuing to gain traction and the Bulk segment stabilizing. The company’s focus on efficiency, portfolio simplification, and supply chain improvements is expected to drive further profitability.

With a strong cash flow and reduced leverage, Bega is well-positioned to deliver sustainable growth and improve returns for shareholders in the months ahead.