Seeka $7.1m in the red after Psa takes its toll

The Psa kiwifruit virus broke out in the Te Puke district in November 2010. Photo / Thinkstock

The Psa kiwifruit virus has taken its toll on Seeka Kiwifruit Industries, plunging the company into a $7.1 million loss for the 2011 year.

The company said that the outbreak of Psa meant that the carrying value of vines in the company's 105ha of "gold" orchards had been impaired, resulting in a charge of $9.7 million.

In addition, the board reviewed the valuation of post harvest, investment assets and goodwill in light of the downturn across the whole kiwifruit industry, which resulted in an impairment charge of $8.8 million.

As a result, Seeka reported an after tax loss of $7.1 million compared to an after tax profit of $6.4 million in the previous corresponding period.

The virus broke out in the Te Puke district in November 2010. Most of the outbreaks so far have been in the Bay of Plenty region.

Seeka said its results compared with a previous nine-month period due to a change in its balance date.

Earnings before interest, tax, depreciation, amortisation, fair value adjustments, impairments and asset revaluations (ebitdaf) totalled $20.8 million, up 4.6 per cent, compared in the previous corresponding period $19.9 million. No dividend will be paid.

Seeka said it continued to comply with all banking covenants.

The company said it had taken steps to reshape its business in response to the virus.

A restructuring process was completed last year and 44 roles were removed from the company.

"While some progress is being made, Psa remains the cause of continuing uncertainty," it said.

The company said it would maintain a "fiscally prudent" approach and would make debt repayment a priority.

Seeka's revenue from ordinary activities went up by 12 per cent to $137 million.

The company's shares closed at $1.00, down 2c.