Tuesday, 20 February 2018

Announcement

MEETING: SML: Synlait shareholders excited by platform for growth

30 Nov 2017 08:30NZX
Synlait Milk''s (NZX: SML; ASX: SM1) Annual Meeting of Shareholders today
focused on the company''s impressive result for the year ending 31 July 2017
(FY17), and plans for the future.

Held in Christchurch, the Annual Meeting of Shareholders commenced at 1pm and
Synlait''s Chairman, Graeme Milne, said FY17 was focused on establishing a
strong platform for the next stage of growth, while also being a solid
financial year.

Synlait had a record profit year in FY17 of $38.2 million and the company
also raised $97.6 million in a capital raise completed in October. This has
enabled debt to be reduced by $131.3 million to $82.6 million, establishing
an excellent base for the next phase of growth.

Mr Milne talked about Synlait''s growing footprint.

"The new blending and consumer packaging facility in Auckland has now been
commissioned and will give us the capacity to meet customer requirements. It
is likely we will also establish further manufacturing sites over time."

John Penno, Managing Director and CEO, discussed the platform Synlait has
laid for future developments.

"Making the most of milk requires us to continually look for profitable new
product and market opportunities to migrate our milk, manufacturing plant,
technical expertise and management time toward. We''ll be really focusing on
this in FY18," said Mr Penno.

"Our investment in research and development has increased from $2.25 million
in FY16 to $4.75 million in FY17, and we''re forecasting a spend of $7 million
in FY18," he said.

"We''ve also recently announced the establishment of a research and
development centre in Palmerston North in partnership with Massey University
and FoodPILOT, which is an exciting development for us as it will open up new
opportunities."

He suggested that Synlait''s B2B status may change.

"In future, we may consider the establishment of branded positions, where
there is no conflict with our existing partner relationships and where we
feel we have significant consumer benefits."

Mr Penno also signaled further expansion is planned in the form of a second
powder manufacturing site.

"We''re also looking to acquire some new land in the North Island to create a
second site, which will also give us access to a second pool of farm
suppliers."

The meeting also discussed Mr Penno''s intention to step down from his role as
CEO sometime in the coming 12 months.

"I am glad John''s decision has come at a time where we can provide a
well-managed leadership transition. The company is in very healthy shape with
a strong balance sheet and a clear future growth plan," said Mr Milne.

"The Board is embarking on an international search for the right person to
lead the business into the future, and John has committed to continuing in
the role of CEO until a successor is found and in place."

Synlait''s Board has expressed their desire for Mr Penno to continue in a
governance role on the Board of Directors, which Mr Penno has indicated he
would continue to do.

Shareholders passed three formal resolutions at the meeting, as follows*:
1) That the Board be authorised to determine the auditor''s fees and
expenses for the 2018 financial year.
For: 132,495,815 (99.97%); Against: 37,588 (0.03%); Total: 132,533,403;
Abstain: 21,911

2) That Bill Roest be re-elected as a Director.
For: 62,527,057 (99.98%); Against: 15,430 (0.02%); Total: 62,542,487;
Abstain: 70,012,827

3) That the annual fee for each Director be $80,000, except for the
annual fees of each of the two Committee Chairs, which will be $92,000, and
the Chairman of the Board, which will be $150,000. All of these increases
apply from 1 April 2018.
For: 132,385,886 (99.89%); Against: 150,962 (0.11%); Total: 132,536,848;
Abstain: 18,466

Pursuant to ASX Listing Rule 1.15.3, Synlait Milk Limited confirms that it
continues to comply with the NZX Listing Rules.

*Percentages represent votes cast in person and by proxy at the meeting.
End CA:00311170 For:SML    Type:MEETING    Time:2017-11-30 08:30:46
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Synlait Milk Limited
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