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Seeka reports half year earnings

Seeka reports half year earnings

Seeka Kiwifruit Industries has reported its half year result to 30 September 2010 with total revenue for the 6 months ended 30 September of $110.4m, an increase of 15.6% on the same period last year. Reported EBITDA of $24.5 m increased by 38.5 % and net profit before tax, non-recurring items and impairments rose by 35.9 % to $20.0 m.

Despite a one-off non-cash deferred tax expense adjustment of $3.2m relating to the change in tax deductibility of buildings with a life longer than 50 years, net profit after tax for the six months increased by 34.6 % to $11.0 m.

All divisions showed improvement in earnings with Post Harvest volumes handled up by 3.3million trays at 22.6m and Orchard Division volumes up 1.6m trays at 10.1m trays. Seeka’s own long term lease orchards delivered 1.2m trays of gold fruit.

Seeka Chief Executive Michael Franks reported “The improvement to financial performance reflects the benefits to the business from the acquisition of Huka Pak in December 2009 combined with excellent production from our long term lease orchards and very good fruit returns from the gold variety. Our operational performance has ensured that supplying growers received very competitive returns and our reputation continues to bring new supplying growers and volume to Seeka”

“The company continues to focus on innovation and efficiency and recently announced it has selected MAF Roda to build a new packing machine for its Huka Pak facility in 2011. This investment of over $5m will be focused on the Green variety delivering efficiencies to the Company and grower suppliers. It will improve throughputs, efficiency and simplify Seeka's post harvest.

As advised at the annual shareholder meeting, Seeka will change its annual balance date from 31 March to 31 December. This better reflects the cycle of Seeka's business, significantly simplifies accounting and improves the meaningfulness of financial statements.

Accordingly, the current financial year will be for the nine months ending on 31 December 2010, with the new financial year commencing 1 January 2011.

Although occurring outside the reporting period, the industry has detected an outbreak of the bacteria Pseudomonas syringae pv actinidiae (Psa). Orchards have been confirmed with Psa across a wide area with a significant occurrence in the Te Puke region. The New Zealand kiwifruit industry has moved rapidly to control the outbreak and agreed a containment strategy.

At the annual shareholders meeting in August, the company predicted earnings before non-recurring items and tax for the 9 months to 31 December 2010 to be between $11.5m and $12.5m, compared to $9.8m for the same period in 2009. The company confirms the forecast guidance.


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