KEY POINTS:
Natural health product maker Comvita has warned it is not confident of meeting its full year profit target, while posting sharply higher first half sales and profit figures.
The company today said sales for the six months to September were up 38 per cent from a year earlier to $31.7 million, while net profit of $203,000 compared with a loss in the corresponding period of $1.4 million.
Chief executive Brett Hewlett said acquisitions made last year had been successfully integrated, with all companies operating well and showing profitable growth.
The business was now more sustainable with sales from four business units of healthcare, functional foods, medical and skincare.
Due to a series of one-off restructuring expenses and the added costs of selling and marketing products in an uncertain market environment, Comvita could not be confident about meeting its net full year earnings projection of $2m to $2.5m as forecast in June.
But barring the market environment deteriorating severely, the company expected to be profitable for the balance of this financial year, Hewlett said.
Considerable costs had already been removed, following the closure of Comvita's Cambridge facility in September and subsequent consolidation into the main production site in Paengaroa, near Te Puke.
Chairman Neil Craig said the company expected to make most of its sales in the second half of the financial year.
Growth was ahead of budget compared to last year in key markets such as Hong Kong, Australia, Taiwan and Japan, he said.
But Comvita was starting to see a softening of sales in some markets, particularly Britain, as the severity of the general economic downturn grew.
Comvita said its core business of bee products remained strong and underlying growth in the functional foods division remained solid at 19 per cent a year.
Under healthcare, sales of olive leaf-based products accounted for 18 per cent of the company's turnover, while within the medical division, woundcare products under the Medihoney brand were gathering momentum internationally.
Comvita shares closed at a year-low of $1.20 yesterday, down from $2.85 in January.
- NZPA
