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T&G Global's profit jumps

NZ NewswireNZ Newswire 4/08/2016 Jonathan Underhill

T&G Global, the fruit marketer controlled by Germany's BayWa, has posted an 89 per cent gain in first-half profit driven by sales from new and existing businesses and a one-time gain from the sale of its crate hire unit.

Profit rose to $22.7 million, or 18.2 cents a share in the six months ended June 30, from $12m, or 9.8 cents, a year earlier, the Auckland-based company said on Friday.

Sales rose 14 per cent to $423m.

The company's growth bodes well for Chinese fruit exporter Golden Wing Mau Agricultural Produce, which emerged with a 19.99 per cent stake last month, becoming the second-biggest shareholder behind BayWa on 73 per cent.

T&G has grown through acquisitions over the past two years, adding Hawke's Bay Apollo Apples, tomato grower Great Lake Tomatoes in the Bay of Plenty and Rianto in Waikato, moving to control of its Australian asparagus joint venture, and entering into a joint venture with Unifrutti Chile to grow and export Peruvian grapes.

In June it opened a new office in Thailand and in Washington state in the US to expand its global footprint.

Chief executive Alastair Hulbert says the growth happened even though fruit production was hampered by unhelpful weather in New Zealand.

"It has been a challenging first six months for some of our apple growers, particularly those in Nelson who were hit by severe hailstorms.

"Some growers lost their entire harvest and T&G lost roughly 10 per cent of its potential volume for the first six months of the year."

While a warm summer in New Zealand delayed exports of pipfruit and local citrus sales, northern hemisphere markets were performing strongly, especially for Jazz and Envy apples, he said.

The company will pay an interim dividend of 6 cents a share, up from a 2 cent payment a year earlier.

T&G's shares trade infrequently because of the amount locked up with major shareholders. It last traded at $2.90 and has gained 38 per cent this year.

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