Zespri pays out after fruitful year

By JIM EAGLES

Kiwifruit exporter Zespri Group is paying a maiden dividend of 7c a share to its grower-shareholders - worth just under $1.5 million - after achieving record sales in the year to March 31.

Zespri's results, announced today, are based on record net sales revenue of $800.4 million, up from $746 million last year.

To achieve that the group sold 65.9 million trays of New Zealand kiwifruit, up from 63.7 trays in the previous 12 months, and also considerably expanded its marketing activities.

It almost doubled its sales through collaborative marketing activities to $12.6 million and increased sales of non-New Zealand fruit from just $800,000 to $5.7 million as part of the plan to make kiwifruit marketing an all-year-round business.

But the company said its sales of non-New Zealand fruit were disappointing, because not enough Italian-sourced kiwifruit were available.

Zespri made a loss of $140,000 on the exercise, which will have to be underwritten by Kiwifruit International.

Chairman Doug Voss said the record revenue was a result of the favourable exchange rate as well as strong market performances in Europe, Japan and Asia.

As a result, virtually all measures of industry profitability showed significant improvement.

Total supplier returns increased 9 per cent to $476 million. Average tray returns rose 36c to $7.23. The standard industry measure of orchard gate returns averaged $29,297 a ha for the year, a rise of 6.2 per cent.

All varieties of kiwifruit earned increased product pool returns apart from organics, which had a 15.3 per cent higher tray return but a lower yield per hectare.

Zespri's share of those returns gave it $85.4 million, which produced an after-tax profit of $7.2 million, more than double the previous year's figure of $3.2 million.

That figure included one-off costs of $4.1 million associated with moving the corporate headquarters from Auckland to Tauranga and a final settlement of $4.6 million for growers of the discontinued Tomua kiwifruit variety.

Voss said the result was satisfactory enough for the board to declare a dividend a year earlier than forecast.

The fully imputed payment of 7c a share, he said, reflected a gross return to shareholders of 8.7 per cent on the issue price of $1.20. It will be paid in September.

A combination of retained profits and a share offer earlier in the year meant company equity was now $22.3 million, compared with $7.6 million at the start of the year.

Voss said Zespri was continuing to invest in the business. Last year Zespri Innovation spent $5.1 million on projects aimed at improving fruit quality and volumes for sale