Struggling New Zealand dairy giant Fonterra announced Thursday that chairman John Monaghan will retire in November at the end of his three-year term.

Monaghan said he was departing as part of succession planning at the world's largest dairy exporter, which posted a record NZ$605 million ($380 million) net loss last financial year.

"Having seen through the introduction of our new strategy, operating model, and with our debt reduction efforts well progressed, the timing is right for me and for the co-op," he said in a statement.

Fonterra, a collective that buys milk and dairy products from New Zealand farmers then sells them on to foreign firms, is refocusing on its core business after a string of poorly performing offshore investments.

Fonterra, a collective that buys milk and dairy products from New Zealand farmers then sells them on to foreign firms, is refocusing on its core business after a string of poorly performing offshore investments
Fonterra, a collective that buys milk and dairy products from New Zealand farmers then sells them on to foreign firms, is refocusing on its core business after a string of poorly performing offshore investments AFP / WILLIAM WEST

It has resulted in huge writedowns on underperforming overseas assets, particularly in China. Fonterra said a chairman-elect would be named by August, allowing a handover period before Monaghan's departure.

In its latest market update released last month, Fonterra said underlying earnings were "tracking well," but warned novel coronavirus was creating a "very fluid and uncertain" situation.

It also warned there could be further one-off writedowns as it reviews its assets.

Fonterra is due to release interim results on March 18.

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