Chair Mike Petersen said it was a solid result in spite of the challenges. Photo:
Apple, pet food and logistics group Scales Corporation has reported a drop in profit of nearly 60 percent, as improved performance from the company's global proteins and logistics divisions partially offset lower results from the horticulture division.
Key numbers for the six months ended June 30 compared with a year ago:
- Net profit $14.3m vs $35.1m
- Revenue $309.3m vs $309.3m
- Horticulture operating earnings $11.4m vs $24.5m
- Global proteins operating earnings $30.1m vs $29.9m
Corporation chair Mike Petersen said it was a solid result in spite of the challenges the horticulture section faced after Cyclone Gabrielle.
"Scales delivered a resilient result in what was an extremely difficult six month period for the Horticulture division," he said.
"Cyclone Gabrielle caused significant loss and disruption, and we are extremely proud of all our team members who were able to resume operations in the week following the cyclone.
"We have endeavoured to support both our staff and the community in every way that we can following Cyclone Gabrielle and will continue to do so as the clean-up continues throughout the region."
Managing director Andy Borland said it had been a tough time for the company's horticulture division, with difficult growing and post-harvest conditions and the effects of Cyclone Gabrielle resulting in lower volumes in Hawke's Bay.
"However, higher in-market apple prices have helped to compensate for the lower volumes," he said.
"Extensive orchard remediation has taken place with approximately 165 hectares of damaged orchards recovered from silt, debris and slash.
"An outstanding effort by our horticulture team has resulted in around 50 percent of recovered blocks being reseeded, with a target to complete the reseeding by the end of this month."
Borland said the company's global proteins arm performed well, capitalising on operational improvements made in earlier periods.
"We were also recently delighted to further expand the global proteins division by establishing a presence in Europe through Esro Petfood JV," he said.
"This joint venture aligns with our strategic objectives for the division in a number of ways, and we are excited for the opportunities presented by this partnership."
Outlook
Scales re-confirmed its annual underlying net profit was expected to be in line with previous guidance, in the range of $14m to $19m.
The directors noted, however, that broader economic trends may affect international markets, though the company was looking to further grow its global proteins division.