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 post-harvest provider’s net profit for the year ending December 31, 2018 topped $9.8 million, versus $5m the year before.
The company puts the great result down to a record volume of kiwifruit packed during the 12 months.
Revenue increased to $185m in 2018 (up from $150m in 2017) and strong profits flowed back to the growers who own the company.
EastPack says it paid out $7.9m to transactor shareholders during the year, and investor shareholders also received a fully imputed dividend of 9.36 c/share, up from 5.04c/share in 2017.
EastPack chairman John Loughlin says 2018 was a record year for the company, with growers experiencing a great return and EastPack delivering high quality service and a robust financial performance on all sites.
“EastPack always has growers at heart, so we’re delighted to be able to celebrate a record year of growth in both production and revenues,” says Loughlin.
The cooperative improved its operational infrastructure to manage increasing labour costs and growth in fruit volume, providing growers with good service and strong orchard gate returns.
Earnings before interest, tax, depreciation, fair value adjustments and rebates of $41.8m were up from $29.9m in 2017.
EastPack chief executive Hamish Simson says during the 12 months, 41.1 million trays were packed across six sites in the Bay of Plenty region. Gold and Green varieties grew in volume in 2018.
EastPack growers generally observed high Class 1 pack-outs and strong storage performance in a year with later loadouts than 2017.
“We also saw increased demand for Prospa, our orchard management service,” says Simson.
Most of Prospa’s new clients have their orchard managed to ensure a consistent labour supply, and to deal with the increasing complexities of producing kiwifruit. The Prospa team now covers 900ha in all growing areas, a 10% increase since 2017.
Simson says that EastPack’s strategy and competitive strength is to have sufficient capacity to pack fruit promptly when growers want their fruit harvested and packed.
“Over the last three years we’ve [invested enough in] packing, pre-cool and coolstore capacity to keep ahead of rapidly increasing fruit volumes, particularly Gold.
“In Te Puke we’re constructing the first fully automated coolstore in the industry with the capacity to store 1.2 million trays.”
