Lower than expected kiwifruit crop volumes across Australia and New Zealand have prompted grower-packer Seeka to update its performance guidance for 2019.
“The effect is industry wide, and reflects unseasonably hot and dry growing conditions which have led to a smaller size profile and total crop volume in both Australia and New Zealand,” according to a release issued by Seeka via the NZX.
In New Zealand, the company had packed approximately 97 per cent of its expected Gold3 (SunGold) kiwifruit and approximately 33 per cent of its expected Hayward crop as of last Friday (10 May).
Based on the volumes to date, Seeka advised shareholders it now expects to pack 33.5m class 1 trays from New Zealand this season, down on its earlier expectation of 36.3m. The performance would still mark an improvement on the 30.2m class 1 trays packed in 2018.
Seeka said its Australian harvest has been significantly impacted by the record high temperatures and dry growing conditions around its base in the Goulburn Valley. The company is predicting a total Green Nashi crop of approximately 900 tonnes (down 18 per cent on 2018) and a kiwifruit crop of 1,900 tonnes (down 26 per cent on 2018).
As a result, Seeka now expects its 2019 group EBITDA (earnings before interest, tax, depreciation and amortisation) to be in the range of NZ$32.5m-NZ$33.5m, compared to its previous guidance of NZ$36.5m-NZ$37.5m issued on 12 April.
Seeka is anticipating a break-even position in Australia at EBITDA in the current financial year, as it continues to build its orchard investment to full production.