Friday, 09 August 2024 08:46

T&G Global trims half-year losses

Written by  Sudesh Kissun
T&G Global has trimmed its half-year losses compared to last year. T&G Global has trimmed its half-year losses compared to last year.

Food and vegetable grower and marketer T&G Global has trimmed its half-year losses compared to last year, as it makes progress delivering its strategy and continues to recover from the impact of Cyclone Gabrielle.

For six months ending June 30, 2024, T&G Global reported an operating loss of $2.6 million, compared to $11.6m for the same period last year. Net loss before tax was $8.2m compared to $21.4m last year. However, total revenue for the Group increased 7% to $820m, compared to $765m in the prior year.

Chief executive officer Gareth Edgecombe says that over the last five years, significant investment has gone in to building the foundations form its future growth.

“In the first half of the year, we’ve seen the benefits of this as we navigated and adjusted to the economic conditions and made progress executing our strategy. It has however been a slower than expected start to the year.

“This season’s apples are high quality, with great flavour and storability, however the lingering impact of Cyclone Gabrielle has reduced this season’s Hawke’s Bay apple volumes. While this is commensurate with the industry-wide experience, it has impacted our financial results. We have also experienced weak fruit and vegetable pricing in the domestic market due to plentiful supply combined with subdued consumer sentiment.”

Notwithstanding this, T&G’s Apples business increased its revenue 14% to $589 million, compared to $518 million in 2023.

“Our Apples strategy is focused on growing great brands and winning in key global markets and we’ve invested significantly in the building blocks for our growth. In the last six months, it’s been great to see the maturing of our Apples strategy,” says Edgecombe.

“It’s the first full season for our new, highly automated Whakatu packhouse and it’s operating at planned efficiency levels – and continuing to improve. In the coming years we expect it to be a strong contributor to profitability as apple volumes increase. Likewise, our appointment of Kotahi to procure ocean freight has enabled us to realise savings and logistical efficiencies.

“To meet growing global consumer demand for our premium apples, we operate a dual hemisphere, multi-country growing strategy, and our 2023/24 North American ENVY™ apple crop was high quality. The brand is holding up exceptionally well in the challenging United States domestic market, with it outperforming other premium brands in both pricing and sales. In Asia, the crop experienced strong sales, and we expect this momentum to continue now that we’ve transitioned across to Aotearoa New Zealand-grown apples.”

Revenue in T&G’s Australasian business, T&G Fresh, decreased to $218 million, compared to $232 million in 2023. This was largely due to it being a difficult trading period in New Zealand with low demand and soft prices, and whitefly impacting tomato volumes.

“While the local market was challenging, given weak consumer sentiment coupled with plentiful supply, our Fijian and Pacific Islands business continued to trade well.

“In Australia, initial production is coming online at our 20ha Queensland berry farm, which is planted with unique blueberry varieties licensed by our VentureFruit business. These berries are outstanding performers in terms of their size, flavour, colour and shelf life. While it’s early in the season, signs are positive for a high yield and strong prices.

“We’ve also made excellent progress with our expansion of the farm, where we’re planting an additional 20 hectares of berries. We expect this to be completed by year end.”

T&G’s VentureFruit business saw its revenue decrease to $4 million, compared to $5.3 million in the comparable period. While licensing revenue was reduced given the macro-economic environment, new licensed plantings in Aotearoa New Zealand, the United States and China demonstrate continued strong demand for T&G’s premium ENVY and JOLI apples.

“Looking out to the remainder of the year, it’s encouraging to see early signs of easing inflation, which will not only benefit our business, but also many households,” says Edgecombe.

He says that last year’s cyclone and this year’s reduced apple volumes have highlighted the need to continue to develop resilience across the business to ensure they’re in a strong position, regardless of what comes their way.

“Our team have responded strongly to this. We’re firmly focused on delivering our strategy and looking for opportunities to reduce costs, drive efficiences and grow revenue, to ensure we meet our medium-term strategic and financial objectives.”

More like this

$8b export milestone

Horticulture Minister Nicola Grigg says she takes her hat off to all NZ growers for the hard yards they have put in over the last few years which have resulted in horticulture exports expected to reach the milestone of $8 billion this year.

Good season for apples

Brydon Nisbet, the president of Hawke's Bay Fruit Growers Federation, says the mood of growers in Hawke's Bay is quite upbeat because it's been a good season for apples.

Gabrielle's effects linger on

Two years ago, Cyclone Gabrielle swept through apple and kiwifruit orchards in Hawke's Bay causing massive damage that has changed the region for ever.

Featured

DairyNZ seeks more cash

For the first time in 17 years, DairyNZ wants farmers to contribute more cash to run the industry-good organisation.

EPA's plan 'not good enough'

The Environmental Protection Authority (EPA) is bolstering its frontline applications teams in a bid to reduce the timeframe for new product applications, but agri chemical producers say that it isn't good enough.

Fonterra urged to seek extension to GMO bill consultation

With less than a week to go before submissions close on the Government’s controversial Gene Technology Bill, two agribusiness executives - John Greenberg and Michael Henne - are calling on Fonterra to demand an extension to the submission period.

National

Helping develop, grow markets

While NZ Avocado is not directly involved in selling fruit, it does have a significant role in supporting exporters to…

Avocados bounce back!

After two challenging years, the country’s avocado growers are quietly optimistic that a good year is in the making.

Machinery & Products

Sorting unwashed potatoes made easy

Downs, a leader in potato reception, automated sorting, and storage, has introduced its new high-throughput optical sorter for unwashed potatoes…

Jumbo X saves time and money

A winner of a prestigious ‘Technical Innovations 2024’ award by FederUnacoma at the EIMA show in Italy, the Maschio Jumbo…

NH unveils specialty tractor

New Holland recently showcased its new-generation T4.120 F specialty tractor, giving New Zealand customers a closer look at the winner…

Combining track and tyre

While the last fifty years has seen massive evolution and development of the humble tractor tyre, the last two decades…

Croplands goes nuts with Nelson

Croplands and Nelson Manufacturing Company Inc, a California-based manufacturer of air-blast sprayers, has announced a new distribution partnership to deliver…

» Latest Print Issues Online

The Hound

Who's the glutton?

OPINION: We are told there is a wine glut - production outstripping demand worldwide - and the words 'wine lakes'…

Colonial science?

OPINION: Science funding for the bulwark of the nation, agriculture, is in a parlous state and less taxpayer money is…

» eNewsletter

Subscribe to our weekly newsletter