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Seeka profit beats forecast and lifts dividend

Seeka profit beats forecast and lifts dividend

TE PUKE, 29 February, 2016 - Seeka Kiwifruit IndustriesLimited [NZX:Sek] announced an audited profit after tax of$4.27m, for the year ending 31 December, 2015, well aboveits guidance range of between $2.96m and $3.53m. Theafter tax profit was up 34.8% on the previous year’s result of $3.17m.

The company announced a fully imputed dividend of $0.10 per share, which will be paid on March 24 to all shareholders on the register at 5pm, 18 March. That brings the total dividend for the year to $0.19, compared to $0.16for the previous corresponding period. The company’s dividend reinvestment plan will apply to the dividend, with a strike price of $3.76 per share.

Financial Highlights for the year include:

• $142.11m in total revenue, up 22.9%

• $13.39m EBITDA up 23.4%

• $5.25m profit before tax up 23.0%

• $0.29 earnings per share up 31.8%

• Asset backing at 31 December totalled $4.34, up 6.6%.

• Total assets at 31 December were $164m, an increase of50% reflecting Seeka’s acquisition of Bunbartha FruitPackers Pty Ltd in Australia.

Seeka Chief Executive Michael Franks said thecompany had proactively taken steps to support itsgrowers following the fire last year at its Oaksidefacility, and subsequent fruit quality issues.

“We’re very pleased to be able to report our thirdconsecutive year of improving results, especially afterour challenging year following the fire,” said MrFranks.

One-off items included $1.12m expensed for transactionand duty costs related to the Australian purchase. They also included a net $0.32m in costs related to the Oakside fire.Seeka paid its growers $4.04m to ensure they had sufficient income and cashflow while they worked through theinsurance claim process. Seeka also wrote off $1.74m infire-impaired assets. The company has also recorded insurance proceeds of $5.46m, resulting in the net $0.32m in fire-related costs during the period. The insurance claimremains in process and any further recovery will berecorded as income when settled.

Mr Franks said profitability continued to improve, with Seeka’s packed volumes increasing to 27.8m trays, compared to 21.4 million trays in the previous corresponding period.

“Seeka has a clear strategy and is focused on deliveringsuperior returns to its growers and continuing to grow thecompany, both in terms of profitability and size. And weare very appreciative of the hard work and support of ouremployees and others associated with the companythroughout the year.”

Seeka Chief Financial Officer Stuart McKinstry said thecompany was currently positioning itself ahead of theAustralian and New Zealand kiwifruit harvests, with theAustralian pear harvest nearing completion. Major capitalconstruction builds were underway at KKP in Maketu, Main Road Katikati, and a significant improvement to thefruit grader at the Australian Kiwifruit packhouse, he said.

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