Fonterra Financial Overview
Operating expenses
Fonterra
Dairy for life
Total Group normalised operating expenses increased
$7 million:
Increased investment in research & development
o Increase in administration, and distribution & storage,
including the impact of COVID-19 supply chain disruption
o Increase in 'other' expenses reflects costs associated with
discontinuing some products that are not aligned with our
long-term strategy
Unallocated costs favourable $63 million, mainly due to the
release of a $44 million provision held at Group relating to the
Holidays Act 2003
NZD million¹
2021² 2022
Costs allocated to regions
Selling & marketing
(299) (305)
Distribution & storage
(265) (279)
Administration expenses
(296)
(311)
Research & development
(34)
(40)
Other expenses
(8)
(28)
Total allocated operating expenses
(902)
(963)
Unallocated costs
(111) (48)
Total operating expenses
(1,013)
(1,011)
Discontinued operations
(42)
(51)
•
Total Group operating expenses
(1,055)
1,062)
1. Normalised basis. Does not align to FY22 Interim Financial Statements, predominately due to
additional categories
2. $42 million of other expenses have been reclassified as administration expenses for consistency with the
current period
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