Debt per kg Milksolids
We monitor three primary KPIs for business health including Operating Profit, Return on Assets (RoA) and Farm Working Expenses (FWE)/kg MS; we also have secondary business health indicators including debt/kg MS. Owl Farm started with $3.7 million debt in 2015. Our goal was to ensure that the farm was meeting compliance in all areas which required a significant investment, including a new effluent pond, an underpass, and a new yard which created a safer workplace.
We have a target of $20/kg MS opening debt and we started the 2021-22 season with $18.23/kg MS. Like all farmers, we have had years of increasing debt (up to $23/kg MS in 2016-17) as we transitioned to a more profitable farm system through challenging payouts. Last season we repaid $270k of debt and had $60k worth of capital expenses (including a new silage wagon). We are focused on debt repayment while maintaining the safe and productive life of our plant and machinery. Owl Farm targets debt repayment of $180,000 in a $6.50+ payout and minimum of $100,000 every year. Working with our financial partner Westpac we are positioning ourselves to invest in future technology/infrastructure that will set the farm up to deliver environmental and animal wellbeing outcomes.