Eastpack is leasing coolstorage space from Seeka to get the final crop in. They are looking at over 50 million trays packed for the season, which should translate into a record profit.
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Eastpack is leasing coolstorage space from Seeka to get the final crop in. They are looking at over 50 million trays packed for the season, which should translate into a record profit.
https://www.nzx.com/announcements/432512
Seeka Limited [NZX:SEK] is pleased to announce a significant increase in the number of class 1 kiwifruit trays packed this harvest season.
In total 43.0 million trays were packed compared to 29.8 million last year. This 44% increase is a pleasing recovery after two very challenging years impacted by weather events.
The additional volume was efficiently processed by our facilities and well within our capability. Availability of labour and automation improvements both contributed to a smooth and effective packing season. Shipping is proceeding well.
The impact of the Zespri shipment infested by rodents is not expected to materially impact earnings.
While the increased trays packed is a signal of a return to profitability, it is too early to accurately predict the financial outcome and to be able to provide reliable financial guidance.
The Company expects to update the market later in the year. Seeka remains focused on maximising operational earnings, debt reduction, and achieving financial leverage targets.
The Company thanks all growers, suppliers, contractors and staff for their efforts in concluding the 2024 New Zealand kiwifruit harvest.Release ends.
Good to see a good recovery from the last 2 disastrous years. But only back on track to where we were a few years ago and the target of 50 million packed trays still a wee while of. Then need to focus on debt repayment and keep dividends suspended for a couple of years at least.
yep i reckon easy a yr or more of no div's to get down this based on current earnings
As long as they have a few good years and can pay down debt I'm happy enough to wait.
Interesting to compare guidance to previous years.
On 21 June, 2023 Seeka announced:
And on 22 June 2022:Quote:
Seeka Limited [NZX:SEK] has undertaken a comprehensive assessment of forecast
full year earnings. The group result for the full year to 31 December 2023 is
likely to be a net loss before tax of between $20 million and $25 million.
This forecast reflects much lower than anticipated New Zealand kiwifruit
volumes. Seeka has completed its New Zealand kiwifruit harvest packing a
total of 29.8m class 1 trays, compared to 42.4m in the previous corresponding
period.
Why were they able to give finance guidance the last two years (in more abnormal conditions) in June but not this year?Quote:
The harvest is now completed, with the total industry Hayward volumes down on
the previous year by approximately 17% and down on the current year industry
estimate by 10%. This follows the SunGold national crop being down on
estimate by 10.2%.
Seeka's post-harvest volumes have followed the lower than expected industry
volumes, and in addition there was crop damage from high winds in late 2021
in the Opotiki region. Total Hayward conventional volumes of 14.4m trays
reflect a 21.5% reduction in average per hectare yields, year on year, and
SunGold conventional volumes of 26.0m reflect a reduction in average per
hectare yields of 10.5%.
Post-harvest earnings from handling kiwifruit represents a significant
proportion of Seeka's earnings, and the volumes handled in the current year
are much lower than anticipated. The total volume of class 1 kiwifruit
handled in 2022 is expected to be 42.4m trays. While that is ahead of
Seeka's 2021 post-harvest volumes, it includes the volume from acquisitions
made since the 2021 season.
Seeka advises that its Australian business has performed well and has
delivered earnings improvement on last year.
Due to the lower SunGold and Hayward volumes, the Company expects full year
net profit before tax to be in the range of $9.0m to $11.0m.
Aussie season gone well.
They mention they'll update the market "later in the year" with financial guidance.
https://www.nzx.com/announcements/432690
I thinks it because Seeka has learned it's lesson with giving financial forecast updates too early in the season.
Seeka had a shocker with fruit coolstore issues a couple of seasons ago. Not all costs could be passed back to growers on repack etc because they would lose too many supplier growers. And they also have a component of income dependent on the sales price of fruit in the market due to the leased orchards and managed orchard contracts.
It's best to play it safe and keep the market informed like they have, and release financial information when there is more certainty over storage, fruit in market sale and fruit loss data.