Seeka Kiwifruit profit rises 47%
Seeka Kiwifruit profit rises 47% on weaker currency
Nov. 19 - Seeka Kiwifruit Industries, New Zealand’s largest supplier of the fruit, posted a 47% gain in first-half profit as it benefited from a lower New Zealand dollar and improved harvesting techniques.
Net income rose to NZ$8.4 million, or 67 cents a share, in the six months ended Sept. 30, from NZ$5.7 million, or 46 cents, a year earlier, the company said in a statement. Sales rose 1.2% to NZ$95.2 million.
The kiwifruit company makes the bulk of its earnings in its first half, reflecting the seasonality of the harvest. Today it raised its full-year pretax profit forecast to between NZ$4.8 million and NZ$5.4 million and predicted demand for kiwifruit would be “stable,” even as global economic growth slumps.
“The company has benefited from the dramatic decline in the value of the New Zealand dollar,” chief executive Michael Franks said. “Provided there is no significant market collapse then the positive outlook for kiwifruit remains.”
Seeka and its related entities handle about 26% of New Zealand’s kiwifruit crop, which is mainly exported by Zespri International, the main exporting body. Orchard gate returns jumped, helped by lower rates of fruit loss during harvest and “an exchange-rate-driven improved Zespri return,” the company said.
Zespri handles about 30% of the world’s kiwifruit export trade.
The New Zealand dollar fell 15% against the U.S. dollar in Seeka’s first half. It has tumbled from more than 81 cents in March to trade recently at 55 cents.
Seeka will pay a first-half dividend of 12 cents a share.