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

 

Comvita lifts earnings outlook on 'grey market' recovery

Comvita lifts 2018 earnings outlook on 'grey market' recovery

By Rebecca Howard

Oct. 18 (BusinessDesk) - Comvita raised its 2018 earnings outlook after a solid recovery of the so-called "grey channel" into China and significant North American sales, chief executive Scott Coulter said in a presentation for the annual general meeting.

The Te Puke-based company's first-quarter sales rose 35 percent from a year earlier and were tracking ahead of budget, giving Comvita "confidence in a profit greater than $17.1 million," according to the annual general meeting presentation. It reiterated an expectation to resume dividend payments in the current financial year.

In August, Comvita projected operating earnings of at least $17.1 million in the year ending June 30 matching its 2016 result.

The grey channel is made up of small-scale exporters who buy the product and post it to China. Moves by the Chinese government to crack down on grey or "daigou" sales had crimped profits for companies such as Comvita.

The honey products maker's improved guidance is contingent on the channel continuing to recover and on a return to a "normal" honey season as well as growth in the North American and South East Asian markets and Chinese joint venture contributing to future profitability, said Coulter.

The China joint venture became operational on July 1 and is focused on e-commerce, expanding stand-alone stores in Shanghai, Beijing and Chengdu as well as actively managing 45 wholesales who cover part of China the company can't reach, according to the AGM presentation.

The stock recently rose 0.8 percent to $7.54 and has shed 6.9 percent this year.

(BusinessDesk)

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Real Estate: Foreign Buyers Ban Passes Third Reading

The Bill to put in place the Government’s policy of banning overseas buyers of existing homes has passed its third and final reading in the House. More>>

ALSO:

Nine Merger: Fairfax Slashes Value Of NZ Business

Fairfax Media Group more than halved the value of its Kiwi assets, attaching just A$40 million to mastheads that were once the core of a billion dollar investment. More>>

Collecting Scalpers: Commerce Commission To Sue Viagogo

The Commission will claim that Viagogo made false or misleading representations: • that it was an “official” seller, when it was not • that tickets were limited or about to sell out • that consumers were “guaranteed” to receive valid tickets for their event • about the price of tickets... More>>

ALSO:

Price Of Cheese: Fonterra CEO Goes Early After Milk Price Trimmed

Aug. 15 (BusinessDesk) - Fonterra Cooperative Group chief executive Theo Spierings is leaving the role early after the world's biggest dairy exporter lowered its farmgate payout and trimmed its dividend to retain cash. More>>

ALSO: