F.F.I. Holdings Limited reported a 12% rise in revenue to $33.9 million for the half year ended December 2025, while net profit after tax fell 12.3% to $1.6 million, impacted by one-off costs and a new government lease. The company declared a fully franked interim dividend of 10 cents per share.
- Revenue increased 12% to $33.9 million
- Net profit after tax declined 12.3% to $1.6 million
- One-off costs from securing new 10-year government lease
- Food operations sales up 13.2%, profit margins stabilising
- Interim fully franked dividend of 10 cents declared with DRP discount
Revenue Growth Meets Profit Pressure
F.F.I. Holdings Limited has delivered a mixed half-year financial performance for the six months ending 31 December 2025. The company posted a solid 12% increase in revenue, reaching $33.9 million, driven largely by its core food manufacturing operations. However, net profit after tax declined by 12.3% to $1.6 million, reflecting the impact of one-off expenses related to a significant property lease transition.
Lease Restructuring Weighs on Earnings
The profit dip was primarily attributed to costs incurred in securing a new 10-year lease on one of FFI’s investment properties. Following a two-month vacancy after the previous lease expired, the property was leased to a Western Australian Government agency at a reduced annual rent of $0.938 million, down from $1.28 million. While this represents a decrease in rental income by over 30%, the company emphasised the long-term security and quality of the new tenant as positive factors for future cash flow stability.
Food Operations Show Resilience
FFI’s food manufacturing segment recorded a 13.2% increase in sales to $33.3 million and a modest 1.6% rise in net profit before tax to $2.37 million. The segment continues to navigate challenges from supply chain disruptions and cocoa market volatility experienced in the prior year. Encouragingly, management noted that cocoa market conditions have stabilised, with expectations for improved profit margins in the coming half-year.
Strengthened Balance Sheet and Dividend
The company’s balance sheet showed marked improvement, moving from net debt of $4.7 million at 30 June 2025 to net cash of $2.7 million at the end of December. This was supported by strong operating cash inflows of $8.1 million, aided by a significant reduction in inventories. Net tangible assets per share rose to $4.50, up from $4.14 a year earlier. Reflecting confidence in its financial position, FFI declared a fully franked interim dividend of 10 cents per share, consistent with the prior year, and announced a dividend reinvestment plan offering a 5% discount capped at $4.50 per share.
Outlook: Focus on Sustainable Growth
Looking ahead, FFI’s management remains focused on its dual pillars of food manufacturing and property investment. Investments in upgrading manufacturing facilities continue, with market conditions currently more favourable. The property portfolio strategy includes developing vacant land to enhance income generation and capital value. The board expressed a positive long-term outlook, aiming to deliver sustainable shareholder value despite near-term profit pressures.
Bottom Line?
FFI’s interim results highlight a balancing act between securing long-term property income and managing short-term profit impacts amid stabilising food market conditions.
Questions in the middle?
- How will the new government lease affect rental income and property valuation over the next decade?
- What specific steps is FFI taking to improve profit margins in its food operations as cocoa market volatility eases?
- Could further property developments materially boost future cash flows and shareholder returns?