Sanitarium feeds income boost

Ironman legend Cameron Brown presents winners' ribbons at a Sanitarium Weet-Bix Tryathlon - one of the company's health promotion activities. Photo / Duncan Brown.

$8.7m gain on the sale of factory damaged in quake helps lift result of firm’s church owner.

Income at the Seventh-day Adventist Church in New Zealand has jumped as the owner of the tax-exempt Sanitarium food company gained $8.7 million on the sale of an earthquake-damaged Christchurch factory.

The accounts, recently filed to the Charities Register, show total income rose 9 per cent to $223.5 million in the year to June 30, 2015.

The church doesn't disclose financial results for Sanitarium alone, but the Auckland-based firm's sales are included in the accounts the church lodges each year for its "Group One" entities.

Those entities - which also include Avondale-based Life Health Food, the maker of brands such as Lisa's and Naked Organics - posted trading revenue of $204.6 million for the year to June 30, up from $191.6 million in the same period a year earlier.

A church spokesman said all of its businesses in New Zealand had shown "good growth".

"Over the past year our market shares in the various categories in which we operate have either been stable or in slight growth," he said. "Our health services business Vitality Works continues to grow strongly and is now a leading New Zealand provider of corporate health services with globally leading-edge workplace wellness programmes."

Total expenses rose to $214 million from $201.8 million in the previous year and included $197.3 million that went towards nutrition, wellbeing and health food activities, according to the accounts. Appropriations of $7.1 million to church entities were also disclosed.

The net surplus for the year rose to $9.5 million from $3 million a year earlier.

Sanitarium has a controversial exemption from paying tax on its business income as a result of its ownership by the church, a registered charity.

The "advancement of religion" is considered a charitable purpose under the Charities Act, which some critics argue is no longer relevant in a secular democracy.

Sanitarium has defended the exemption by saying it operates exclusively for charitable purposes and tax exemptions are available to all businesses that limit themselves to such activities.

According to property records, the 3ha former Sanitarium property in Papanui now belongs to the Smith family, which operates a number of Mitre 10 hardware stores in Christchurch.

A Mitre 10 Mega outlet is expected to open on the former Sanitarium site in late June.

The company's Papanui factory made Weet-Bix and Marmite, but was badly damaged in the February 22, 2011 Christchurch earthquake, sparking the shortage of the breakfast spread dubbed "Marmageddon".

Weet-Bix production shifted to Auckland in 2012, reportedly at the cost of 36 jobs, and in early 2014 Sanitarium announced it was selling the property.