Outgoing Comvita CEO David Banfield said today (29 August) he was “extremely disappointed” with the honey supplier’s annual results, which included a loss of more than NZ$77m ($48.2m).
Comvita booked a net loss after tax of NZ$77.4m for the year to the end of June, a swing from a profit of NZ$11.1m 12 months earlier.
Central to the loss was a non-cash impairment of NZ$59.8m. Last month, Comvita had issued a trading update for the year that included a loss of NZ$16.8m.
However, the company said its bottom line could in fact be hit further “subject to impairment adjustment yet to be quantified”.
Revenue dropped 12.7% to NZ$204.3m for the full-year period. Comvita posted an EBITDA loss of NZ$59.6m compared to a gain of NZ$30.6m in its fiscal 2023.
Banfield said: “I’m extremely disappointed with the results that we report today, particularly after three consecutive years of record performance. Throughout FY24, we faced difficult trading conditions in our key markets, along with aggressive price activity from competitors caused by industry overstocks.”
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Excluding the implementation of an ERP system and non-operating costs, EBITDA was presented as NZ$17.1m, versus the full-year guidance of NZ$23-28m.
Looking forward, the chief executive added: “We already have action underway to target value consumers whilst continuing our brand premiumisation in key Asian markets.
“Our NZ$10-15M cost out programme is on target and is designed to streamline and simplify the business and ensure agility through different economic cycles. In addition, we have a clear focus on inventory reduction enabling us to reduce net debt to targeted levels.”
The results come just a few days before Banfield is succeeded at the helm of the honey maker by current chairman Brett Hewlett.
The company’s share price was down 4.24% at the close of trading in New Zealand today. The shares extended the year’s slide to more than 51%, having halved in value since the start of 2024 to NZ$1.13.
Hewlett said today: “While we initially appeared to be navigating this fall off the peak, the full impact of the global economic slowdown, aggressive price competition and a significant sales decline in China hit home in H2 FY24. This has been a challenging time for the company.”
“This has caused us to take urgent action to right-size the company, and to de-risk, without compromising our long-term potential so we can respond positively as market conditions stabilise,” he said.
