25 May 2012

Zespri profit triples, payments to growers rise

1:27 pm on 25 May 2012

Kiwifruit marketer Zespri has announced a lift in total payments to growers for the past season on the back of a record crop of 116 million trays.

Zespri has tripled its full year profit to $20.5 million in the year to the end of March, compared with $7.3 million in the previous year, but warns the PSA vine disease will dampen earnings in coming years

Sales rose 7% to $1.62 billion on the back of the record crop volume resulting in payments to growers rising by 11% to $980 million.

Chairman John Loughlin says the average orchard gate return for growers increased by 8% to just over $45,000 a hectare.

However production will be reduced over the next two years due to the effects of the bacterial disease PSA, he says.

Mr Louglin expects that economic uncertainly in the euro zone, rising costs and a volatile New Zealand dollar will further dampen prices.

Zespri says PSA is expected to knock out one third of its gold kiwifruit production in this current financial year and more next year before recovering.

The kiwifruit marketer is cutting its corporate costs by $10 million though it will continue to invest heavily to find ways to combat the PSA disease.