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Turners & Growers first half profit slumps 39%

Turners & Growers [NZX: TUR], the fruit marketer controlled by Germany's BayWa, reported a 39 percent drop in first-half earnings, saying profitability had been hurt by a series of one-off events including a supply shortage.

Profit fell to $10.2 million, or 8.72 cents per share, in the six months ended June 30, from $16.6 million, or 14.2 cents, a year earlier, the Auckland-based company said in a statement. Revenue fell 7.6 percent to $341 million.

The company's international produce division suffered supply shortages through the period, while its processed foods unit under-performed due to the strong New Zealand dollar and limited fruit available for processing.

"The group's profitability has been adversely affected by a number of isolated one-off events," chairman Klaus Lutz said in a report. "Trading for the remainder of the year is expected to be consistent with last year's performance."

In April, Turners & Growers agreed to buy Hawke's Bay-based Apollo Apples for up to $44.1 million to meet growing global demand, and meet bigger export markets. The company said it's still waiting on Overseas Investment Office approval for the deal.

The board declared an interim dividend of 5 cents per share, which was paid on May 29.

The shares were unchanged at $2.05, and have gained 17 percent this year.

The company's pipfruit segment delivered an operating profit of $16.8 million on sales of $114.1 million, compared to earnings of $13.9 million on revenue of $126.1 million a year earlier. The international produce unit had earnings of $1.3 million on sales of $90.1 million, compared to an operating profit of $5.7 million on sales of $103.4 million.

The New Zealand produce division made an operating loss of $397,000 on sales of $73.6 million, from a loss of $1.1 million on revenue of $69.6 million, while processed foods made a loss of $1.6 million on sales of $42.9 million, compared to a profit of $3.8 million on sales of $51 million a year earlier.

(BusinessDesk)