A bacterial infection which has hit Zespri's top-performing commercial cultivar, Hort16A, on a New Zealand-owned Italian orchard may mean the orchard's value has to be written off.
Opotiki Packing and Coolstorage Ltd (Opac) said today its 84 hectare Newgold orchard, which is planted in Hort16A gold kiwifruit, has suffered a
continuing outbreak of a bacterial disease which is threatening the orchard.
The Newgold orchard investment was valued at $7.160m in the Opac financial statements in December 2008.
"The Opac board has determined that the full cost of this investment should be written off and this is likely to result in Opac recording a loss for the financial year ended December 31, 2009," the company said.
Seeka Kiwifruit Industries Ltd's chief executive Michael Franks, whose company took a 19.4 per cent stake in Opac in 2004, told NZPA the bacteria was one which was he was not aware of being a problem in New Zealand. It caused some problems on the Italian orchard last season, but had become much more serious this season.
Seeka will record its share of the loss in its own group financial results for the year ended March 31, 2010, and as a result reduce its investment in Opac. That stake is currently on the company's books at $4.209 million.
Any impact is expected to be less than $1m, and will not affect Seeka's loans.
Last November, Seeka predicted expected its full year operational earnings to be in the range of $6.9m to $7.5m, compared with $5.6m last year.
This remained the same, except for Seeka's share of the anticipated Opac loss, Franks said.
- NZPA
