Dairy Farmers and Gary Helou

Murray Goulburn: Last week, the cooperative downgraded its profit outlook to half the value forecast in the prospectus a year ago, and slashed milk payments to farmers, according to Australian Broadcasting Corporation. Managing Director Gary Helou, along with his chief financial officer, both resigned from the company but questions remain about their role in the float and promises of financial return to investors. Related Story: Murray Goulburn announces price drops, MD leaves Related Story: Future uncertain for dairy farmers after milk price cut Map: Sydney 2000 The board of Australia largest dairy processor faces two weeks of gruelling meetings with farmer suppliers, to explain what went wrong with its strategy. Financial Review columnist Joe Aston said Murray Goulburn would take at least five years to get back on track. "The Murray Goulburn promise was always sour, it was just that some people were yet to twig to it," he said. "There was no way that listing a co-op to pay off debt to fund a massive capital intensive program for so-called value added dairy products was going to work especially when half of those products were private label milk in huge volumes in very skinny margins." In 2014, MG opened two new fresh milk processing plants at Erskine in Sydney and Laverton in Melbourne, valued at $160 million. But Chinese demand faltered, falling to half what is was buying, according to Mr Helou himself before his departure last week. "Clearly Murray Goulburn has been a victim of global commodity prices no doubt," Mr Ashton said. "But how anybody with a straight face could continue to tell the market, over $6 per kilogram milk solids farm gate, at a time when their nearest competitor Fonterra was offering $3.90 in New Zealand, is just completely mindboggling. It also forecast a $260-$300million spend on nutritional powders to expand production. (news.financializer.com). As reported in the news.