The balance sheet appears to be in fine fettle at natural health products company Comvita.
In a market update to the New Zealand stock exchange on the second half trading of 2009, the Bay of Plenty company said it was trading profitably on the back of strong salesperformance in most markets, particularly Asia.
It was still too early to provide an estimate of the actual profit result for the full year ending March 31 but overall organic sales growth for the quarter (ending March) was expected to be 20-25 per cent up on the same period in 2008.
"Our strategy of sale of our premium Comvita branded natural health products, through a diversity of sales channels and markets, is clearly working," said chief executive Brett Hewlett.
As well as an increased spend on promotion in some markets, the improved sales revenue was a function of marketing infrastructure spend and acquisitions in offshore markets over the last three years.
Comvita was also starting to see the impact from the fall in the New Zealand dollar.
It ran a foreign currency hedging policy of between 50-70 per cent of net export receipts, 12 months ahead so the full impact of the New Zealand dollar decline would provide gradual and ongoing benefits over the coming year.
The March 2009 result will also include some one-off costs relating to the closure and relocation of the company's Cambridge manufacturing plant to Paengaroa in the Bay of Plenty, Hewlett said. "We expect to post a positive year end profit result. We have a good working relationship with our bankers, Westpac, and have recently rolled over our long term debt positions."
