Zespri forecasts annual profit growth

Zespri is expecting net profit of $182-$192 million in the current year. Photo / File

KKiwifruit marketer Zespri is forecasting annual profit growth of up to 7 per cent.

The firm, which markets kiwifruit on behalf of 2,500 New Zealand growers and another 1,200 in Italy, Japan, Korea and France, is expecting net profit of $182-$192 million in the current year, including licence release income.

That is up from the $179.8m net profit reported for the year ended March, which was a 77 per cent increase from the year before as the firm shipped more fruit for better prices. Total trays sold climbed 21 per cent to 167.2 million last year – 85 per cent of which was New Zealand-grown green or gold kiwifruit.

Zespri shares trade on the Unlisted market. They changed hands at $8.20 yesterday, up about 42 per cent from a year earlier when adjusted for the firm's three-for-two stock split in March.

The latest earnings forecast comes despite a slight trimming of Zespri's expected New Zealand fruit and service payments.

It is projecting total fruit and service payments of $1.75-$1.85 billion in the year ending March 2020, excluding loyalty premia. That is $25m less than the firm signalled in its first forecast in April, but in line with the $1.82b reported in the year ended March.

Zespri is expecting green fruit to return $5.50-$6.50 a tray at the orchard gate this season, up from the $5.20-$6.20 signalled in April, and the $5.45 achieved last year.

Gold fruit is expected to earn $10.20-$11.20 per tray, up from the $9.70-$10.70 signalled in April and against the $10.89 achieved last year.

Organic green fruit, which accounted for about 3.5 million of the 148.8 million trays of New Zealand-grown kiwifruit last year, may earn $8.30-$9.30 a tray this year, up from the $8-$9 signalled in April, and against the $9.22 achieved last year.

The sweet Green14 variety, which produced about 900,000 trays last year, may bring in $6.80-$7.80 a tray, Zespri said yesterday. That is down from the $7-$8.50 signalled in April but in line with the $7.23 achieved last year.