Australia: Costa Group sees revenue growth across produce categories in H1
Australia's top produce grower and marketer Costa Group (ASX: CGC) notched a 31.9% year-on-year spike in EBITDA in the first half of 2015-16, reaching AUD$39.3 million.
CEO Harry Debney said the results reflected a productive first half for the company.
"Our overall positive performance demonstrates not only the resilience of our business model, but also our portfolio structure and our capacity to absorb individual category volatility in production and markets," he said.
The company said revenue growth of 18.9% was seen across produce categories, including blueberries, raspberries, citrus, grapes and mushrooms.
Diversified farming sites and protected horticulture techniques were able to ensure blueberry availability for the period despite impacts from hailstorms in Corindi, while the second year of Costa's berry growth expansion project has been successfully completed on schedule.
"Despite our Corindi farm experiencing several damaging hailstorms during the period the financial impact was only moderate due to our strategic investment in protected cropping," Debney said.
"This investment [in the expansion project] ensures Costa continues to grow its market volumes in blueberries, raspberries and in summer strawberry production. Importantly, we now have consistent year round production of high quality blueberries."
The group said raspberry yields were strong and consumer demand continued to support the category, while citrus yields were excellent and export market conditions were "excellent".
Costa's early season grape farm at Mundubbera performed above expectations, while yield improvements were seen in mushrooms due to production refinements across the group's network.
The company cited challenging market conditions for tomatoes due to favorable winter conditions leading to large field crops; snacking tomatoes were still the best performing sub-category in tomatoes, but in general supermarket sales were sluggish and there was excess supply on wholesale markets.