Bumper crop raises Zespri's full-year profits

Good weather linked with improvements in orchards meant high production.

The 2015/16 kiwifruit season broke records for the industry and Zespri with the biggest-ever total return to growers, highest-ever Green return per hectare and record sales volumes for both Green and SunGold kiwifruit.

Total sales revenue for the season also grew to $1.9 billion, up 21 per cent from the previous season, said chairman Peter McBride.

The total fruit and service payment to growers for New Zealand-grown fruit increased 22 per cent on the previous year to $1.143 billion, with the average return per hectare reaching a record $60,758.

Zespri corporate net profit after tax was $35.8 million, up $1.2 million on the previous corresponding 12 months. This season's profit and the increase in full dividend to 24 cents was partly attributable to the release of a $13 million provision relating to Zespri's subsidiary in China, ZMCC, now resolved with the Shanghai Court, as well as receipt of licence fee income. Zespri's normalised profit after tax was $27.8 million (compared to normalised profit of $21.5million last year).

Zespri sold 131.6 million trays in the 2015/16 season, up 21 per cent on the previous season. New Zealand-grown kiwifruit sales hit 117 million trays, nearly 22 million trays more than the previous year, and 14.5 million trays of non-New Zealand kiwifruit.

Mr McBride said the record per hectare Green return of $56,673 (up from $53,884 last year) was driven by a reduced per-tray return of $5.13 (down from $6.01 last year), but very strong average orchard yields of 11,048 trays a hectare, up from 8972 trays per hectare last year.

Improving orchard management practices combined with favourable weather conditions last season resulted in a large crop of Green of 80.7 million trays.

"This increase in productivity is positive as it allows us to deliver very good value to both our customers and our growers," Mr McBride said.

Zespri said SunGold's performance in export markets was positive. The largest-ever New Zealand volume of 27.5 million trays (from a total New Zealand Gold volume of 32.6 million trays including Hort 16A Gold) was sold and earned an average return for the Gold pool of $8.21 per tray. SunGold yields averaged 8,653 trays per hectare and Zespri is optimistic it will increase.

Zespri chief executive Lain Jager said there were no surprises in the results.

"But at the end of the day, we have to deliver quality, particularly in the case of the very high Green yields we have seen," he said, adding that although Green yields were at a historic high, he believed they could still increase.

"We have to make sure we are focusing on dry matter and delivering a really high quality offering. While this is a pleasing result, every single piece of fruit we sell is a moment of truth for our brand promise and we still have work to do to improve the consistency of our offering."

Zespri: 12 months results to March 1

* Total sales revenue 2015 season: $1.9 billion (up 21per cent on the previous year)

* Fruit and service payment to growers: $1.143 billion (up 22per cent on the previous year)

* Net profit after tax $35.8 million (up $1.2 million on previous year)