Seeka announces record interim result

Fri, 19 Nov 2004

Seeka announces record interim result and declares increased interim dividend of $0.10

Seeka Kiwifruit Industries Limited has recorded an unaudited profit after tax of $4,509m for the six months ended 30 September 2004, compared to $3,963m for the same period last year. Total revenue increased by 8% to $43.162m, with the major proportion of Seeka’s revenue earned in the harvest period, which occurs in the first half of the financial year. Seeka forecasts it will achieve or exceed 2003/04’s record profit levels of $3.087m, despite international marketer Zespri saying kiwifruit values will be significantly lower for the current selling season, says Seeka chairman Brian Allison.

“The six month profit lift primarily reflects the increase in post harvest volumes processed by the company from harvest 2004,” says Allison.

“The Company has traded strongly over the six month period, with post harvest volumes up 20% and the company packing a record 11.2m class 1 trays.

“Seeka’s investment in new capacity during 2003/04 put the company in a good position to handle higher fruit volumes, with facilities operating close to capacity. Orchard leasing operations also performed well with more than 3.465m trays of class 1 fruit harvested from leased orchards, up 11% on the 3.023m trays harvested 2003/04.”

“Zespri is forecasting lower kiwifruit values for the current year, with Zespri’s fruit payments being lower and slower due to the longer selling season. Coupled with larger crop volumes, this has increased the value of work in progress and lowered cashflow at the six months mark. As the value of fruit inventory is determined by Zespri’s forecasts, a stronger than forecast end to the selling season would improve Seeka’s overall financial performance for the full year,” says Allison.

Seeka’s board of directors has declared an interim dividend of 10 cents per share fully imputed. The interim dividend will be paid on 20 December to all shareholders on the register at 5pm 14 December 2004. The total amount of the dividend is $819,978, and the company’s dividend reinvestment plan applies.

Seeka has launched its offer to amalgamate with Eleos Limited. The boards of both companies have agreed the terms of the offer, have signed a deal letter, and the Offer and Registered Prospectus has been mailed to Eleos shareholders. Eleos shareholders will meet 1 December 2004 to consider the offer which requires a 75% approval for the amalgamation to proceed. The terms of the offer are contained in the Registered Prospectus, a copy of which can be obtained on the Seeka’s website www.seeka.co.nz.

“This amalgamation leads an exciting expansion phase where Seeka is anticipating increasing both market share and volume,” says Allison.

“The amalgamation and further expansion are focused on delivering value to shareholders and grower clients of both companies.”

ENDS

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