Bega Group has reaffirmed FY27 normalised EBITDA guidance of $240-$245 million and will invest about $110 million in capital expenditure to expand manufacturing capacity, with projects in yoghurt, cream cheese and milk-based beverages due to come online in FY28.
Speaking at the company’s AGM on 21 October, CEO Pete Findlay said first-half earnings were expected to be relatively flat, with strong growth in the second half. Growth will be driven by the branded business and by productivity gains from the closure of the Strathmerton cheese site and automation at the Laverton warehouse.
Bega has also extended its strategy targets to FY2031, aiming for normalised EBITDA of more than $310 million, revenue of $4.3 billion to $4.7 billion, earnings per share of 37 to 39 cents and double-digit return on funds employed.
Manufacturing footprint
Bega completed the closure of Strathmerton in June 2026, moving its volume to the Ridge Street site in Bega within 14 months. Findlay said the move had doubled production capacity at Ridge Street.
Since 2023 the company has consolidated Canberra production into Penrith, integrated the Betta Milk acquisition into its Lenah Valley site in Tasmania, sold the Leeton juice extraction site and its peanut processing assets in Queensland, and restructured its head office, cutting costs by more than $20 million a year.
The Morwell yoghurt plant is undergoing what Findlay called “significant transformation”, and Tatura is being expanded for cream cheese. Bega repurchased and reconfigured the Tatura dryer to support protein production, and has invested in infant formula canning.
“Our transformed manufacturing footprint now provides a highly competitive cost position,” Findlay said.
He said Bega was “increasingly utilising” its infant formula assets “as industry capacity tightens”, and that a growing share of the protein in its branded products was being supplied internally by its Ingredients and Nutritionals business.
FY26 result
For FY26, Bega reported net revenue of $3.8 billion, up 6.7 per cent. Normalised EBITDA rose 12 per cent to $225.6 million and normalised net profit after tax rose 36 per cent to $69 million. Statutory profit was $54.8 million, compared with a loss of $8.5 million in FY25. Normalisation items related mainly to the Strathmerton closure and the wind-down of peanut processing at Kingaroy and Tolga.
Return on funds employed reached 10 per cent, meeting its 2028 target two years early. Net debt rose $25.5 million to $151.6 million, mainly due to $37.1 million in restructuring costs, with leverage steady at 0.8 times. Capital expenditure was $109.8 million and the total dividend rose 21 per cent to 14.5 cents a share, fully franked.
Milk intake increased seven per cent. Bega buys about 1.4 billion litres of milk a year.
Findlay said supply constraints during parts of the year, caused by the Middle East conflict and higher than expected demand, limited Bega’s ability to fully meet demand in Southeast Asia. Marketing spend behind its five power brands rose by $9 million.
Remuneration vote
Proxy votes lodged before the meeting showed 31.39 per cent against the adoption of the remuneration report, above the 25 per cent threshold for a first strike under the Corporations Act. Proxies were 99.56 per cent in favour of inserting proportional takeover provisions into the company’s constitution.
