Profit jumps for New Zealand's leading fresh produce exporter
Turners & Growers Global has posted an 89 percent gain in first-half profit driven by sales from new and existing businesses and a one-time gain from the sale of its crate hire unit.
The fruit marketer is controlled by Germany's BayWa but is Auckland based. Their product base includes apples, pears, mandarins, coconuts and kiwifruit.
T&G profit rose to $22.7 million, or 18.2 cents a share in the six months ended June 30, from $12m, or 9.8 cents, a year earlier. Sales rose 14 percent to $423m.
The company's growth bodes well for Chinese fruit exporter Golden Wing Mau Agricultural Produce, which emerged with a 19.99 percent stake last month, becoming the second-biggest shareholder behind BayWa on 73 percent.
T&G has grown through acquisitions over the past two years, adding Hawke's Bay Apollo Apples, tomato grower Great Lake Tomatoes in the Bay of Plenty and Rianto in Waikato, moving to control of its Australian asparagus joint venture, and entering into a joint venture with Unifrutti Chile to grow and export Peruvian grapes.
In June it opened a new office in Thailand and in Washington state in the US to expand its global footprint.
Chief executive Alastair Hulbert says the growth happened even though fruit production was hampered by unhelpful weather in New Zealand.
"It has been a challenging first six months for some of our apple growers, particularly those in Nelson who were hit by severe hailstorms."
"Some growers lost their entire harvest and T&G lost roughly 10 percent of its potential volume for the first six months of the year."
While a warm summer in New Zealand delayed exports of pip fruit and local citrus sales, northern hemisphere markets were performing strongly, especially for Jazz and Envy apples, he said.
The company will pay an interim dividend of 6 cents a share, up from a 2 cent payment a year earlier.
T&G's shares trade infrequently because of the amount locked up with major shareholders. It last traded at $2.90 and has gained 38 percent this year.