The Frontier Agriculture Group has reported strong earnings performance, confounding the industry trend for the year-ending June 2024. 

Profit before tax was £40 million, in line with prior year (£40.2 million) on Group Revenues of £1.8 billion (prior year £2.3 billion).

As a result of the lower winter wheat plantings following the wet autumn of 2023 and consequent reduction in spring crop protection and fertiliser purchasing, Group operating profit was down nearly 30% to £37 million (prior year £52.1 million).

However, over the last three years Frontier has invested in a number of adjacency businesses including start-ups associated with its supply chains and nationwide farm-gate activities. Principal investments in this category have been in agricultural banking through Oxbury - for which Frontier is one of the founding investors since 2018 - oat milling with Navara and data analytics via YAGRO; a portfolio providing valuable services to the sector while building robustness in future earnings during periods of trading volatility. 

In the year-ending 2024, this strategy to diversify activities has proved successful, with Frontier’s investment in agricultural banking appreciating in value by £16.8m which fully offset the downside impact in the Group operating profit. This allowed the business to achieve an overall profit before tax performance in line with the previous financial year. 

Commenting on the results, Group Senior Executive Director, Mark Aitchison says: "Like many of our farmer customers, diversifying income streams in parallel with volatile trading activities provides some security of earnings.

"Our adjacency investments are all in areas we believe can benefit our customers, providing for us both the opportunity to bring more certainty. Robust earnings enable us to invest in the core business at a consistent rate during periods of downturn, and ensures we continue to develop products and services for the future."

Frontier Agriculture's Managing Director, Diana Overton, adds, "Our investment in Oxbury has proved very successful and the bank is now able to provide totally independent and expert support to the UK agriculture sector.

"Its dedicated commercial team understand farming and can deliver personalised financial solutions, with a unique combination of face-to-face service and speed of action built around an agile digital platform."

Further information can be found in Frontier Agriculture’s Annual Report and Accounts for 2024, which can be viewed here