Comvita - CVT

**Toddy** · 15-08-2024, 08:30 AM

There are people selling cheap Manuka honey on the Te Puke Facebook page lately.

It's probably from the CVT coolstore or fallen off the back of the truck from CVT.

10 plus UMF 25 bucks per 500g pots.

**Sideshow Bob** · Today, 08:41 AM

https://www.nzx.com/announcements/437063

CVT FY24 results impacted by challenging market conditions

FY24 Results snapshot

• Revenue of $204.3M -12.7% vs PCP (FY23: $234M)
• Gross profit of 55% -300bps vs PCP (FY23: 58%)
• EBITDA*
- Reported -$59.6M (FY23: $30.6M)
- Underlying** $14.6M (FY23: $33.5M)
• NPAT
- Reported -$77.4M (FY23: $11.1M)
- Underlying -$5.6M (FY23: $13.1M)
• Non-recurring one off costs of $15.7M
• Non-cash impairment of $59.8M*** before tax (FY23: $0)
• Net debt $79.7M (FY23: $53.4M)
• Inventory $134.4M (FY23: $136M) targeting material inventory reduction in FY25
• No dividend declared

Key points

• Demand: Abrupt change in consumer demand following macro-economic challenges in China and loss of a major customer in the North America market
• Cancellation of major shopping events (12:12 and 6:18 shopping festival) and weak 11:11 festival in China severely impacted demand
• Pricing: Significant unsustainable aggressive short-term price driven promotions from competition and beekeepers exiting the category
• Supply: Over production from FY17 – FY22 has created a glut of honey being cleared in markets around the world. Between 2020 and 2023 there has been a 56% reduction in supply, in addition, hive numbers are forecast to drop by 50% to c500K by 2025
• Business model designed for anticipated growth with a significant fixed cost element
• Long term cost-out programme initiated and on track, targeting $10M-$15M annualised savings to enable Comvita to be agile through different economic cycles

**bull....** · Today, 08:52 AM

when you read results from china PDD of consumer sales you better put your worry hat on for CVT china sales going forward

**Leemsip** · Today, 08:59 AM

Dont think I have read a worse announcement than this in a while...

basically a panicked CEO's high pitched schreeching that the company is doomed and there isnt any way to save it..

**Perky** · Today, 09:04 AM

It’s ok Leemsip…they keeping the ceo on board to consult and bringing back another fellow who also has had a go at making this company work.

**flyinglizard** · Today, 09:37 AM

They need a new CEO who can sell the company, that is the only resolution.

**kiwikeith** · Today, 10:16 AM

At least the announcement cannot be accused of sugar-coating things.

**Balance** · Today, 10:31 AM

Industry rationalisation now in progress - that’s for sure.

**kiwikeith** · Today, 10:42 AM

Net Debt is $80m, Market capitalisation is $82m. So Enterprise value is $162m. Inventory is $134m. 83% of the enterprise value is represented by inventory. Be nice to see them get the inventory level down.