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Friday 03 December 2021

T&G issues profit warning

18th October 2021 By Staff Reporter | news@foodticker.co.nz | @foodtickernz

Produce giant T&G Global has warned its profit for the 2021 financial year will come in between $4m – $10m, a potential contraction of as much as 76% from the $16.6m profit it posted in 2020.

Chief executive Gareth Edgecombe said the “disappointing” outlook reflected updated forecasts for business units suffering Covid-19 disruption, namely its apples, international trading, and T&G Fresh divisions.

On its apples business, well-known for the Jazz and Envy brands, T&G said shipping challenges and associated impacts on pricing and costs, especially in the Northern Hemisphere and Asia were to blame for what was expected to be a poor result.

The impact on its international trading division was due primarily to shipping delays T&G said. It added that market access challenges as well as supply shortages, particularly from USA and Australia, also played a part.

For its New Zealand fresh product business, T&G Fresh, the list of Covid impacts included labour unavailability and increased costs, pricing of seasonal produce lines, lockdown retail and foodservice closures, and shipping delays for imported produce.

Edgecombe said that the profit forecast also included the impact of a number of one-off items, including property disposal and plant write-downs, which were expected to be largely neutral at the group level for the year.

Looking ahead, Edgecombe said the BayWa-controlled group continued to adapt to the challenges of the current operating environment.

“The board is confident that the resulting operational efficiencies will, along with the growing revenue streams from its genetics business, result in significant improvements in performance over the next year,” Edgecombe said.

In August, the NZX-listed company saw its interim net profit before tax fall 63% from $13.7m in the previous period to $5.1m in the six months to 30 June 2021 as it counted the costs of summer storms and ongoing shipping, supply chain and labour issues.

 

 


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