PGG Wrightson Revenue Tops $1.1b as Profit Jumps 46%
After delivering a strong financial year, rural trader PGG Wrightson says the coming months will depend on customer confidence and weather.
The forecast sees Green volumes increasing 16% to over 80 million trays and SunGold (Gold3) volumes up nearly three times on last season's volumes.
Zespri chief executive Lain Jager says with deliveries of NZ fruit almost complete, this season has been marked by the record yield of large-sized Green fruit, which has provided strong sales opportunities across global markets.
The forecast Green return is $4.87 per tray with a record Green crop of over 80 million trays. The forecast average return per hectare for Green is $53,765, virtually unchanged from last year's return per hectare of $53,884. This is the result of higher yields offsetting lower per-tray returns with the return of Chilean kiwifruit to the market, after shortages caused by the 2013 frost.
The Organic Green forecast reflects strong sales in Europe and Japan. The forecast return for Green14 (sold as Sweet Green) is $6.94 per tray and Orchard Gate Return (OGR) per hectare has increased significantly to $42,644 as vines reach maturity.
"The season also provided great results for Zespri SunGold," says Jager. "As volumes continue to grow strongly, and customers and consumers respond positively to this product. This gives us confidence that the forecast SunGold volume growth will be readily supported by markets.
"Zespri is closing in on total sales of nearly 21 million trays in Japan – a record result for that market. Sales in China also hit a record high of over 18 million trays, up from 11.4 million trays the previous season."
Total Gold volumes were around 33 million trays with SunGold volumes increasing nearly three times from 10.6 million trays last season to 27.5 million trays in 2015/16. Jager says the forecast return for Gold is $7.96 per tray, as per-tray returns normalise after record highs. The per-hectare return for Gold is $68,807 reflects orchard yields continuing to recover from the impact of Psa.
Zespri has focused on finishing the NZ sales season strongly, with final arrivals of fruit in China and Southeast Asia last week and the Zespri Global Supply season from Zespri's Northern Hemisphere orchards now underway.
The forecast Total Fruit and Service Payment (including the loyalty premium) is $1,116 million, which is up $177 million on the 2014/15 result and reflects volume growth as the industry continues to recover from the impact of Psa.
Jager says the outlook is for continued volume growth, investment to grow demand ahead of supply and a focus on delivering strong returns to growers.
"The potential impact of slower global economic growth and foreign currency fluctuations poses some risk but we're going into 2016 with confidence," says Jager.
The forecast range of normalised profit after tax for Zespri for the year ending March 31, 2016 is $16.5 million to $21.5 million.
