Produce company Seeka has posted a 12 percent increase in profits for the first half of the year, driven by more volume coming through its kiwifruit business.
Photo: RNZ / Susan Murray
The company, which is the country's largest kiwifruit grower, said net profit after tax was $20.6 million in its interim, unaudited results, up from 18.4 million in the first half of last year.
Shareholders will also receive a dividend of 13 cents per share.
Seeka chief executive Michael Franks said he was pleased with the result.
He said strong demand has also led to record group revenues of $224 million in the six month period, up 26 percent on June 2020.
"There's a lot more volume being grown of the SunGold variety from Zespri, so our volumes are going up in the harvest and to process.
"The market has been strong. Of course Zespri had the challenges of shipping, and we all know about all of those issues at the moment. But really the fruit is loading up and seems to be moving through the supply chain to the markets quite well all things being considered."
Franks said returns out of Australia have been strong, but it's not all smooth sailing.
"Business conditions remain tough. I'd say that even though our profits have been well up.
"The avocado sector is under pressure at the moment with a glut of avocados in Australia, which is our primary market. We've given earnings guidance for the full year between $13.5 and $16 million (before tax) from operations," he said.
Michael Franks said it is also set to receive a one-off gain in the second half of the year from the court settlement of the kiwifruit claim against the Crown.
"Seeka continues to invest in our kiwifruit business, acquiring Ōpōtiki Packing and Cool Storage Limited (OPAC) in May. OPAC is an eight-million-tray kiwifruit operation that expands our service delivery to the Ōpōtiki, East Cape and Gisborne regions. OPAC is now integrated, synergy savings on target, and the business is set to make a full-year financial contribution in 2022.
"We have also made a significant investment into agritech, taking a cornerstone stake in the digital startup Fruitometry. Seeka's investment will accelerate the development of smart orchard scanning technology that will help lift orchard production and realise supply chain efficiencies," Franks said.
Seeka said it was also investing $20 million in capacity builds for harvest 2022, including a new automated packline and high efficiency coolstores near Te Puke.