Dairy producer Warrnambool Cheese and Butter Factory still expects dairy prices to remain weak, with no improvement until late 2015 at the earliest.
Warrnambool Cheese, which is 88 per cent owned by Canadian dairy giant Saputo and 11 per cent owned by Japan's Lion and Kirin, had said in May that weak international dairy prices would put pressure on the company's profitability in fiscal 2016.
"Currently, and in line with our expectations, dairy prices remain weak," Warrnambool chairman Lino Saputo said in an annual general meeting speech on Monday.
"And in particular, the price of certain dairy products has fallen again in recent weeks, putting additional downward pressure on the company's profitability."
Mr Saputo said industry experts had recently pushed back expectations of a price recovery to late 2015 or early 2016.
Meanwhile, Warrnambool Cheese intends to accelerate its growth activities, invest in capital projects, increase manufacturing capacity and grow milk intake.
In May, Warrnambool Cheese acquired the everyday cheese business of Lion Dairy & Drinks for around $138 million, aiming to increase Warrnambool's presence in the branded everyday cheese segment in Australia.
But for fiscal 2016 the addition of the everyday cheese business was expected to make only a very small contribution to profits.
Warrnambool Cheese last traded at $9.60.
Share
