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MG drops Cobram shift

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March 09, 2017

Murray Goulburn has confirmed shifts at its Cobram processing factory were dropped from three to two recently, which could last until September.

However, an MG spokesperson said it was part of the company’s normal practice of allocating its available milk to the best returning stream, and not part of any review the company was undergoing.

It had not affected staffing levels at the plant, the spokesperson said.

The Cobram plant’s consumer cheese facility also recently started commercial production for the company’s Coles private label cheese contract, after unveiling the new $91million facility earlier in the year.

In a statement to suppliers last month, chief executive Ari Mervis said when his appointment was announced, he prioritised the need to engage with as many suppliers as practical.

‘‘To this end, I am happy that every effort is being made to achieve this commitment, and invitations to multiple gatherings in all regions will be sent to you shortly,’’ he said.

‘‘It remains essential we have an opportunity to get to know one another and discuss your views on MG and the industry.

‘‘In light of the immense challenges so many of you continue to face, it is vital that I have the opportunity to hear your assessment of the current situation.’’

Mr Mervis met with suppliers at a meeting at the Cobram Barooga Golf Club last night (Tuesday), and he said he was would also be meeting with local government, MPs and industry representatives.

An MG spokesperson said Mr Mervis was undertaking a far-reaching tour of MG’s regions, starting in northern Victoria this week.

Mr Mervis said he thanked interim chief executive David Mallinson, who played a vital role in managing the company during challenging times.

‘‘While I appreciate the enormity of the challenges and responsibilities of the role, I sincerely look forward to the opportunity presented,’’ he said.

Murray Goulburn also recently released its 2017 half-year results, with milk received down 20.6 per cent to 1.6billion litres and revenue down 14.8 per cent to $1.2billion.

However, MG said a number of factors gave the company confidence for the outlook beyond this financial year, including improved seasonal conditions, current commodity pricing, and that the realisation of planned cost reduction initiatives indicate improved milk prices for suppliers.

‘‘The first half of this financial year has been a particularly challenging time for MG,’’ Mr Mervis said.

‘‘Record rainfalls and high levels of competitor activity have reduced our milk intake, impacting revenue and our ability to fully recover fixed costs and overheads.

‘‘I am pleased with progress on cost and working capital initiatives, which remain a priority.

‘‘The release of cash from working capital and continued improvement in cost efficiencies will be a key focus in the second half of this financial year.’’

●See next week’s Courier for our interview with Mr Mervis prior to his meeting with local suppliers last night.

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