6 Dec 2017

Tegel blames quake for slight drop in profit

12:11 pm on 6 December 2017

New Zealand's biggest poultry producer Tegel has reported a slight drop in its profit because of one-off costs from last year's Kaikōura earthquake.

Road works continue on the Inland route to Kaikoura.

The Kaikoura earthquake caused major issues to roading in the area. Photo: RNZ / Rebekah Parsons-King

Its net profit for the six months ended October was $14.8 million compared with the previous year's $15.1m.

Revenue rose 2 percent to $302.3m.

Domestic volumes were up 1.7 percent, while export volumes fell as expected, because it is changing its strategy in Australia.

Chief executive Phil Hand said the company's move into the retail market in Australia has started well and represents a significant opportunity.

"It has been particularly satisfying to see Tegel products achieving such significant national distribution in Australian retail."

Mr Hand said Tegel has kept its market position in New Zealand, despite pricing challenges.

"We are continuing to invest in our brand, and at the same time accelerating our innovation and new product development programme which is resulting in more higher value product in market, particularly free range products and value added meal solutions," he said.

He said it is looking to boost its growth in New Zealand and continue to build market share overseas.

Tegel will pay an unchanged interim dividend of 3.45 cents per share.

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