New Zealand’s Scales Corporation has announced its profit over the first half of 2014 was down 22 per on the corresponding period last year, following a mixed performance from the group’s apple grower-packer-exporter subsidiary, Mr Apple.
Scales recorded an overall profit of NZ$20.6m (US$17.2m) in the six months to 30 June 2014, down from $26.4m (US$22m) in 2013, despite sales rising by over 3 per cent to NZ$150.2m (US$125.7m).
The Christchurch-based company’s horticultural division, which includes the Mr Apple business, increased its sales 1.9 per cent to NZ$90.1m (US$75.4m), with apple export volumes 7 per cent above initial forecasts.
However, this was offset by an 11 per cent decline in operational earnings, which dropped to NZ$23m (US$19.23m), with Scales pointing to falling European apple prices.
The Mr Apple business was the catalyst for Scales’ strong financial performance in 2013, which saw annual profit climb 50 per cent to NZ$20.4 m (US$17m).
Scales’ managing director, Andy Borland, insisted Mr Apple remained a core part of the business’ success; particularly as new investments were made to capture a greater share of the growing Asian market.
“We are continuing to develop our presence in Asia and other near markets, aided by the fact we expect premium variety apple plantings to yield increased volumes for 2015,” Borland explained. “Together with a group of other primary sector New Zealand exporters, we are establishing ServeCo, a collaborative venture based in Shanghai which is designed to assist the partners' trade into China.”
Scales expects net profit to fall to NZ$15.9m (US$13.3m) in 2014, before rising to NZ$20.8m (US$17.4) in 2015.
