Kiwifruit is New Zealand's top horticulture export. Photo / RNZ
Kiwifruit is New Zealand's top horticulture export. Photo / RNZ
Kiwifruit marketer Zespri continues to forecast a lower net profit after tax for FY25 than last year, attributed to a fall in growing licence revenue.
In its November update, the grower-owned company said the forecast corporate net profit after tax for the financial year ended March2025 was expected to be between $137 million and $147m, including licence income.
This is up on its August forecast for FY25, but still well below its FY24 net profit after tax of $173m.
The August forecast for FY25 was between $132m and $142m, including licence release income. This was below a May forecast of $138m to $148m, following a reduction in forecast offshore-grown fruit volumes for the 2024 season, and a reduced margin on New Zealand supply from greater time payments associated with the longer season.
Zespri has the statutory right to export all New Zealand kiwifruit, except to Australia.
The company recorded a global operating revenue of $4.2 billion, including licence revenue in FY24. Global fruit sales revenue was $3.99b.
In its November forecast, the company said that compared with its August outlook, per-tray returns were up across nearly all fruit categories other than RubyRed.
Forecast per-hectare returns were now at record levels for green and organic green fruit on the back of improved orchard yields.
Per-hectare returns for SunGold were also up on the August forecast.
Total fruit and service payments to the industry were forecast to be $2.94b.
Zespri has had 190 million trays to sell from this record volume season, which produced strong fruit quality and historically low fruit loss, the company said.
It also noted savings from efficient advertising and promotional spending and foreign exchange gains.
This week the company had just 4% of the SunGold crop left to sell. Green fruit quality had become more “challenging” at the back end of the season but was being managed with just a few weeks worth of fruit left to sell.
As the New Zealand sales season draws to a close, Zespri’s counter-seasonal northern hemisphere sales have kicked off in Europe. Sales of offshore-produced Zespri-branded fruit are due to start soon in Japan and Korea, with the United States and China markets set to follow next month.
Zespri's sales season for northern hemisphere-grown branded fruit is under way.
The company expected to sell more than 26 million trays or more than 93,000 tonnes of kiwifruit this season from contracted orchards in France, Italy, Greece, Korea and Japan.
Zespri’s global supply programme began 25 years ago to support its strategy to deliver a 12-month fruit supply to key markets. It works with 1500 overseas growers.
The company expected to sell more than seven million trays of Zespri Green fruit from Italy and Greece this season.
Meanwhile, voting continues on Zespri’s second attempt to persuade growers to allow it to expand offshore production.
After 10 days of voting, 37.5% of eligible producers have voted, compared with 12.62% at the same time in 2022 when Zespri first proposed expansion.
Growers are being asked to support the allocation of up to 420 additional hectares of SunGold per year over six years in Italy, France, Japan, South Korea and Greece. The allocation is subject to an annual review by Zespri’s board to confirm forecast demand remains ahead of supply and the provision of annual reporting to growers.
To pass, the resolution will need support from at least 75% of producers who vote, both by number and weighted production.
Grower advocate NZKGI (New Zealand Kiwifruit Growers Incorporated) supports the resolution, as does Māori Kiwifruit Growers Inc, whose members grow 10% of New Zealand’s total export crop.
Zespri’s earlier bid for expansion was to extend plantings of SunGold overseas, excluding China and Chile by up to 10,000ha.
The vote was close but fell short of success because some growers who did not own shares did not believe more offshore planting would benefit them. Fewer than 50% of Zespri’s growers own shares, a level the company is working to lift.
Voting closes on December 5. The result will be known in mid-December.
Andrea Fox joined theHerald as a senior business journalist in 2018 and specialises in writing about the $26 billion dairy industry, agribusiness, exporting and the logistics sector and supply chains.
