Costa Group has posted its 2020 calendar year (CY20) results with strong performances from multiple categories driving a turnaround from a challenging 2019.
The leading Australian fresh produce company reported an EBITDA – SL of A$144.8m (US$114m) for CY20 compared to $98.3m (US$77m) for CY19, an increase of 47.2 per cent.
Costa's revenue increased 11.2 per cent from CY19 to A$1.164bn (US$920m) in CY20, meanwhile, its NPAT – SL increased 108.4 per cent on CY19 to A$59.4m (US$6m) in CY20.
This growth comes after a 2019 that saw Costa downgrade its earning guidance multiple times as it contended with the effects of drought on its key crops.
In CY20, things were more positive and Costa chief executive Harry Debney said favourable market conditions, the performance of its international segment and the company’s recovery from the previous drought challenges contributed to Costa's results.
“There were favourable market conditions in CY20 supported by positive demand and pricing across a number of our produce categories, including citrus, berry, and avocado. Our superior blueberry IP, in particular our premium Arana variety, meant we were able to sell increased volumes while also receiving a significant price premium,” said Debney.
On the international front, the performance of Costa’s Moroccan blueberry operations were much improved from CY19 and the first commercial volumes from the company’s blueberry variety programme partner growers in South Africa and Zimbabwe were marketed in CY20.
In China, Costa’s full year blueberry volumes were exceptionally positive versus budget, delivering a strong result. Costa plans to expand its blueberry production in Morocco and China by 14ha and 7.2ha respectively.
Costa also announced plans to expand citrus and avocado production domestically through acquisitions and new plantings.
“Today the company announces it is actively engaged in a citrus acquisition programme to increase its Sunraysia citrus footprint to at least 700ha over CY21. To support this expansion, we have also commenced planning for the development of a large-scale packing facility to be sited in Mildura, signalling how much of priority the Sunraysia region is with respect to our citrus growth plans,” said Debney.
“The company is committed to investing in new crop growing methods to achieve improved yields, reduce production costs, and address climate-related risks. This is why in CY21 we will commence a commercialisation programme for the planting of 40ha of protected, trellised high-density substrate avocado trees, across a number of regions aligned to our existing avocado plantings. A small trial undertaken over the past three years has already delivered global leading results, including faster tree maturity, higher yield, better fruit quality and greater efficiency of water use versus conventional plantings.”