Seeka announces improved 12 month financial results

Published: Mon 2 Mar 2015 10:44 AM
Seeka announces improved 12 month financial results and dividend
TAURANGA, 2 March, 2015 — Seeka Kiwifruit Industries Ltd (NZX-SEK) has announced its audited financial results for the year ended 31 December 2014, with net profit after tax totalling $3.17 million, up 38 per cent on the previous year’s $2.3 million.
The net profit was ahead of the guidance range of $2.6 million-to-$3.0 million provided to stakeholders and the NZX in October 2014.
Seeka -- New Zealand’s biggest kiwifruit grower and a leading post-harvest operator -- reported earnings before interest, tax, depreciation and amortisation (EBITDA) of $11.29 million, up 19.5 per cent from $9.45 million the previous year. That was ahead of the guidance range of $10.0 million-to-$10.5 million.
Profit before tax totalled $4.26 million, up 42 per cent on the previous year of $3.00 million. This included a $1.4 million gain on the sale of Seeka’s shares in Opotiki Packing and Coolstorage Ltd (OPAC), and a cost of $1.85 million associated with Seeka’s Grower Share Scheme.
“The improved results are an important step in rebuilding the profitability of the company,” said Seeka Chief Executive Michael Franks. “This has been achieved in a competitive market for Seeka’s post-harvest services and we have achieved great returns for our supplying growers.”
Operating revenues of $115.67 million were up 18.8 percent from $97.37 million the previous year. Total turnover for the year was $148.6 million.
Earnings per share for the year were $0.22, compared with $0.16 per share the previous year. Seeka issued 1.08 million shares in 2014 and at the end of the year each share had a net tangible asset backing of $4.07 and a market price of $3.23.
Seeka will distribute a fully imputed final dividend of $0.08 per share on March 27 to all shareholders on the register at 5pm March 20, bringing the total for the year to $0.16 fully imputed. The dividend reinvestment plan will apply, allowing shareholders to convert their cash dividend into shares at a strike price of $3.00 per share.
Mr Franks said all parts of the business had performed well, including the newly acquired Glassfields business, which had been integrated within Seeka to form its Retail Services division. Seeka was taking deliberate steps to reposition itself as a more broadly-based produce company, he said.
However, Seeka continued to take a long-term view in maintaining and developing its core kiwifruit business, said Mr Franks. Kiwifruit capacity plans have been reviewed and new investment made to ensure Seeka had the capabilities to handle the anticipated increased volumes in the 2015 harvest.
“We have been steadily rebuilding since Psa. Seeka is now back on a growth trajectory, both in size and profitability. Sustainable profit recovery remains our key strategy.”
Mr Franks thanked all growers, staff, contractors and shareholders for their continuing support and interest in the company.
Seeka Chief Financial Officer Stuart McKinstry said Seeka was carrying low debt levels, with total debt less cash at 31 December, 2014 of $17.24 million. Of this amount, Seeka had invested $11.59 million in growing the crop that would be harvested in 2015, which was treated as inventory and typically funded on short-term debt.
“Removing this from the total debt amount leaves us with a core debt of $5.65 million, which we consider to be low in the context of Seeka’s total long-term assets of approximately $80 million,” said Mr McKinstry. The $5.65 million compares with $4.7 million at the end of 2013.
Seeka results highlights for FY 2014:
· Profit after tax of $3.17 million, up 38 per cent from $2.30 million in 2013.
· Operating revenues of $115.67 million, up 18.8 percent from $97.37 million in 2013.
· Earnings before interest, tax, depreciation and amortisation (EBITDA) of $11.29 million, up 19.5 per cent from $9.45 million in 2013.

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