Mānuka honey company Comvita forecasts another annual loss

Comvita is forecasting a net loss before tax of between $20 million and $24m for the June 2025 year.

Mānuka honey company Comvita is forecasting a net loss before tax of between $20 million and $24m for the June 2025 year, excluding any impairment, which was substantial last year.

The Comvita board announced it needed to take more action to reduce the company’s debt.

Comvita’s net loss before tax for the year ending June 30, 2024 was $21.6m.

That doesn’t include an impairment and other asset write-downs, which came to $64.2m. Its restated 2024 net loss before tax was $85.8m.

The company expected the level of impairment for the 2025 year to be “material”.

Comvita stated that it is still struggling with aggressive pricing and channel-loading by competitors, which is where a supplier sends more goods to distributors than are likely to be sold within a reasonable time.

The company is forecasting 2025 revenue to be slightly below last year’s $204.3m. It has managed to cut its net debt from $81.6m in December last year to about $63m this month.

Cost savings have come from cutting 70 fulltime-equivalent employees and other initiatives, but that has led to significant one-off restructuring costs.

The annualised savings target is between $15m and $20m, although the company said most of the benefits wouldn’t be seen until the 2026 financial year.

Due to a reduction in inventories of about $30m, Comvita’s operating cashflows have increased from 2024.

“The board has determined that additional action is required to ensure the debt position is sustainable and accordingly, is working with its investment banking and legal advisers to explore all options available to the company.”

In March, Comvita secured a waiver of two banking covenants that it was unable to meet.

It is still engaged in discussions with its lenders to negotiate covenants relief for the 2025 and 2026 financial years and to restructure its banking facilities.

Comvita’s full-year results are due to be released in late August. Earlier this month, the company announced Karl Gradon would be taking over as CEO from August 1.