Comvita New Zealand has rewarded shareholders who remained loyal to the company during last year's heated takeover battle by delivering a record net profit for the year to March and a hefty increase in its final dividend.
Comvita, which is involved in natural health and beauty products - much of it derived from manuka honey - said its net profit hit $8.2 million, which was at the top end of last year's earnings guidance of $7.3 million to $8.2 million.
The result compared with a net profit of $500,000 in the previous year, which was depressed by $3.1 million in one-off costs.
Comvita fought off a $2.50-a-share takeover bid last October from Singapore-based Cerebos Pacific. At the time, a valuation conducted by consultants Grant Samuel put Comvita's value at $3.40 to $4 a share, which was too much for Cerebos.
Comvita's shares closed up 25c yesterday at $3.15.
Comvita declared a fully imputed dividend of 10c a share, bringing the total for the year to 14c, up from the previous year's total of 3c. Chairman Neil Craig said it was a pleasing result, considering the Cerebos bid tied up much of its management team for four months.
The company increased its dividend payout to 50 per cent of its net profit from 40 per cent, which Craig said reflected the company's confidence in its future earnings.
Craig said that Comvita, which has a history of undershooting its own forecasts, had managed to deliver on its earnings guidance, despite critics describing it as "aspirational rather than real".
He thanked shareholders who had stood firm during the takeover battle and said the company had drawn some lessons from the experience.
He said the company had been guilty of not paying enough attention to the share price and of not building a reliable earnings record.
"That made us set about doing the job really well, and making sure that when we make promises, we deliver on those promises," he said. "If we deliver, the price goes up and we are less vulnerable to takeover."