Experience Comvita in Paengaroa will likely not reopen. Photo / Supplied
Experience Comvita in Paengaroa will likely not reopen. Photo / Supplied
Bay company Comvita has made 90 staff redundant as part of a company restructure while its iconic tourist attraction at Paengaroa is unlikely to reopen.
The restructuring process has resulted in 50 job cuts to New Zealand-based roles with the remainder based overseas, which has enabled the company to dramaticallyreduce its projected losses for the year.
Comvita released its audited results for the year to June 30, which showed its net loss narrowed to $9.7m from a $27.7m shortfall a year earlier.
Group chief executive David Banfield said the company had made far-reaching organisational changes, including having to remove more than 50 jobs from the business nationally.
"We have had to make some really tough calls," he said.
"One of the things we have really been struck by is the people whose roles have been affected, the way they reacted in most cases recognised we needed to change.
"That just makes it even more important for us to now deliver."
While he did not wish to say how many Bay job losses there were, he said staff were employed at airports and its flagship store in Auckland.
"We have closed down our processing plant in Nelson."
Global staff numbers dropped from 630 to 540 - resulting in 90 job losses worldwide.
Comvita group chief executive David Banfield. Photo / Supplied
Banfield said the job losses were due to the company having to also close its retail stores, including the Experience Comvita tourist attraction in Paengaroa.
"The main visitors we had going through were from tourists, and cruise ship passengers," he said.
He did not believe the tourist attraction would reopen as the company instead focuses its energy on its Comvita Auckland Store on Quay St.
"But we have kept the cafe open. It is temporarily closed while we are in alert level 2 but it will be open again."
However, he said the strength of the second half of the year showed the company was "incredibly capable".
"The more companies are profitable and are thinking about longer term investment it shows we are focused on making sure we are fit for the next 50 years."
At an operating level, Comvita said its earnings before interest, tax, depreciation and amortisation (ebitda) came to $4.2m, compared to a first-half loss of $8.8m.
The second half's ebitda of $13m was driven by a focus on the growth markets of China and North America, Comvita said.
Comvita's net loss for the year included the impact of $9.3m in "non-operating items".
Revenue for the year increased to a record $196m, up 14.5 per cent on the previous corresponding period.
Comvita completed a $50m capital raise in June 2020 with strong support from both retail and institutional investors, bringing net debt down to $15.5m
Demand for Comvita's products in the wake of the Covid-19 pandemic lifted revenue outside New Zealand, Australia and Hong Kong by $20m as consumers worldwide turned to natural health products.
"I do think people genuinely believe a lot of the answers come from nature and most medicines today originate in a natural form," Banfield said.
"With this global pandemic, people are more inclined to try to understand how nature can be part of the solution."
These gains in global markets were diluted by a $12m reduction in New Zealand, Australia and Hong Kong due to disruptions to the tourist, retail and "daigou" sales channels.
"Going forward, we think it is really important we win at home and that our Kiwi customers get the benefit of the products we make," Banfield said.
"From here on in you will see more of us at home talking about what we are doing and how we do it, contributing more locally."
Comvita shares last traded at $3.33, up 19c or 6 per cent from Friday's close.
Western Bay of Plenty mayor Garry Webber said "any sort of retrenchment, regardless of how big or small it is, in any business is difficult".
"But I think as most people realise, these are challenging times at the moment and the tourism industry is really affected by that.
"As a result that is not surprising albeit sad. But that's one of the consequences of the pandemic."
Comvita chairman Brett Hewlett said he was "encouraged by the turnaround" in Comvita's performance.
"We have made significant changes to the business to set ourselves up for long term profitable growth and have seen this start to materialise in bottom-line improvements in the second half," he said.
