Chief executive highlights “increasingly volatile environment” when sharing H1 2022 results

T&G Apples

Source: T&G Global

T&G Global has reported on a “challenging” start to 2022, with revenue dipping in its core apples business.

According to interim results released by the New Zealand-headquartered company, total revenue for the six months to 30 June (H1 2022) came in at NZ$645.5m (US$406m), down from NZ$652.1m the year prior.

Operating profit increased 37.6 per cent year-on-year to NZ$15m, while profit before income tax increased 52.9 per cent to NZ$7.8m.

T&G’s apples business reported a revenue of NZ$401m in H1 2022, compared to NZ$421m in 2021.

“We’re operating in an increasingly volatile environment, with ongoing supply chain disruptions, growing inflationary pressure, rising costs, macroeconomic geopolitical events and Covid-19 continuing to affect some of our key markets,” said T&G chief executive Gareth Edgecombe.

“This is against a backdrop of more frequent adverse weather events, as we saw with the heavy rain at the start of the Hawke’s Bay [apple] harvest, which extended the harvesting window beyond the optimal period. This, together with disruptions in shipping schedules, led to some quality issues and the late arrival of fruit into several markets. This made it a challenging start to the year.”

Edgecombe emphasised T&G’s continued investment in the apple category, which has been partly funded by a number of sale and lease-back arrangements.

“Over the last four years, we’ve repurposed NZ$300m through property and orchard sales to reinvest in our growth, including our NZ$100m state-of-the-art automated packhouse in Hawke’s Bay, with the first phase due to be operational for the 2023 apple season,” Edgecombe explained.

“We’ve continued to make progress on our future-proofed orchard optimisation and improvement plans, including the planting of our premium Envy brand on automation-ready 2D structures.”

T&G chair Benedikt Mangold said despite the complex and challenging environment, the company has a bright future ahead.

“Over the last six months the team has put in a tremendous amount of effort to tackle the curveballs as they’ve arisen, while at the same time keeping each other safe and putting in place the foundations to deliver our long-term strategy,” said Mangold.

“Our strategy, together with our strong financial discipline, provides a clear pathway to deliver significant future growth and improved financial performance, and this will create a strong and sustainable business for the next generation.”