Decision made on fate of defunct Gore meat plant

Blue Sky Meats general manager of operations Ross Smith (left), chief financial officer Jess Vickery, chief executive Todd Grave and engineering manager Gavin Tippet (right) look over the company's 2018 annual report. Photo: Blue Sky Meats

Blue Sky Meats has decided to sell its Gore plant which has been non-operational since late 2016.

Last year, the company announced it was reviewing its options for the unprofitable plant. Options ranged from reinstatement of full operations to an asset sale.

When the plant was temporarily closed, Gore staff were offered secondment to the company's Morton Mains plant.

In a statement, the company said the decision was not made lightly but the board felt it was the best course of action for the company's ongoing financial performance.

Blue Sky Meats has released details of its annual report for the 2018 financial year which showed a much improved result with a net profit before tax of $3.7million, compared to a $2.5 million loss the previous year.

Revenue was up from $97 million to $105 million and shareholders were being paid a dividend of 5cents per share.

The improved position was being attributed to more chilled sales, better yield from each carcass and an increase in rendering returns.

Chief executive Todd Grave was delighted with the company's performance. It helped to bolster confidence and showed what a small Southland company could accomplish, he said.

The company, which had a series of disappointing financial performances in recent years, was now 18 months in to the three-year implementation of a strategic plan.

A focus on maximising the value from each carcass had generated $6.9million of additional value which had been achieved with minimal additional operating expense and capital investment, he said.

Despite the consolidated position, Mr Grave emphasised there was still a lot of work ahead.

"We know we've worked really hard to be in this position, made a lot of changes — some of which have not been easy at times — but it shows in where the company is today, compared to last year.

"One positive year is never an indicator of how the coming year will go and, going forward, we're concentrating on increasing our profitability and resilience."

Chairman Scott O'Donnell said the next step would be creating a value-added, differentiated brand position to further increase profitability.

That would include a focus on investing in plant infrastructure to reduce the company's environmental impact.

Last year, Chinese-owned company NZ Binxi withdrew a takeover offer for Blue Sky Meats.

The company's annual meeting will be held on August 2 at Bill Richardson Transport World in Invercargill.