Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Moa widens FY loss, gets letter of support from shareholders

Moa widens full-year loss, gets letter of support from Business Bakery, Pioneer

By Jonathan Underhill

May. 27 (BusinessDesk) - Moa Group, the boutique beer maker which raised $16 million when it went public in 2012, posted a wider full-year loss and said major shareholders Pioneer Capital and the Business Bakery have committed to providing enough financial support to allow the company to keep operating for at least the year ahead.

The net loss was $5.8 million, or 19.2 cents a share, in the 12 months ended March 31, from $1.9 million, or 7.3 cents a year earlier, the Auckland-based company said in a statement. Sales jumped 88 percent to $4.6 million but was outpaced by a 137 percent jump in cost of sales, trimming gross profit to $792,000 from $848,000. Expenses soared 135 percent to $6.5 million, as costs of distribution, administration, and sales and marketing all rose.

Moa warned in November that the full-year loss would be between $5 million and $6 million, bigger than was projected in the prospectus, with lower-than-expected sales blamed on problems with its distributor, which it has now replaced with a more direct distribution deal. At the time the company said it was embarking on a strategic review to improve performance.

Yesterday, Moa said it signed a long-term contract to have much of its beer manufactured by McCashin's Brewery in Nelson, while higher-margin specialty brews would be made at its Blenheim site, where expansion has been bogged down by a protracted resource consent process. While it initially gained consent top expand its brewery at Jackson Road, Blenheim, it was subsequently appealed by a number of parties and Moa has opted to try to resolve the issues by mediation rather than what it calls "an expensive appeal process."

Moa had $4.1 million of cash reserves as at March 31, down from $11.5 million a year earlier and in a note to its accounts say it is "looking at a range of financing alternatives and timing to ensure adequate capital resources are available to support the group's growth plans and capitalise on opportunities."

Pioneer Capital, which owns 24 percent of the company, and The Business Bakery, on 23 percent, have provided Moa with "a letter of commitment to provide financial support that the directors believe is sufficient to allow the group to continue to operate and meet its obligations for at least the next year," the company says in its accounts. "The details are still being determined."

Chief executive Geoff Ross, who is also a director of The Business Bakery and drove the creation of both 42 Below and Ecoya, now renamed Trilogy International, said contract brewing at McCashin's adds "significant brewing capability" for high volume brands.

"In short this gets us the efficiencies of scale without significant capital investment," Ross said.

Moa shares last traded at 62 cents, valuing the company at $18.7 million, about half the $1.25 sale price in its 2012 initial public offering.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: Leighton-Led WGP To Build, Manage Transmission Gully

The Wellington Gateway Partnership, led by a unit of ASX-listed Leighton Holdings, has won the $1 billion contract to build the Transmission Gully road north of Wellington. More>>

ALSO:

Gareth Morgan: The Government’s Fresh Water Policy – Revisited

Fresh water quality is the latest area to be in the sights of Gareth Morgan and his research organisation The Morgan Foundation... They found that the fresh water policy was a bit murkier than the Environment Minister let on. More>>

ALSO:

Interest Rates: RBNZ Hikes OCR To 3.5%, ‘Period Of Assessment’ Now Needed

Reserve Bank governor Graeme Wheeler raised the official cash rate as expected, while signalling a pause in rate hikes to assess the impact of moves so far this year. The kiwi dollar sank after Wheeler said its strength was “unjustified” and that the currency could have “a significant fall.” More>>

ALSO:

Fonterra: Canpac Site 'Resize' To Focus More On Paediatrics

Fonterra is looking at realigning its packing operations at Canpac, in the Waikato, to focus more on paediatric nutritionals... The proposed changes could mean around 110 roles may not be required at the site which currently employs 330. More>>

ALSO:

Scoop Business: Postie Plus Brand Gets 2nd Chance With Well-Funded Pepkor

The Postie Plus brand is getting a new lease of life after South Africa’s Pepkor bought the failed retailer’s assets out of administration and said it will use its purchasing power to reduce costs of stock and fatten margins. More>>

ALSO:

Warming: Warming Signs From State Of Climate Report

Climate data from air, land, sea and ice in 2013 'reflect trends of a warming planet' -- says the latest State of the Climate report, launched by U.S. and New Zealand scientists. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news