16 Apr 2018

Honey company warns poor harvest, takeover mooted

12:40 pm on 16 April 2018
Honey output has plummeted.

Honey output has plummeted. Photo: 123RF

The honey products and oils company, Comvita, has warned a poor harvest due to the summer weather is expected to more than halve its profits offer.

The company is also facing a possible takeover.

The company said it now expects a net profit for the June year of between $8 million and $11m against a previous forecast of more than $17m.

"It is disappointing that after early signs the 2018 honey crop was shaping up well, we have experienced such a poor end to the season," Chairman Neil Craig said.

The company said it had already harvested 80 percent of its expected crop and yields were about half of what it had originally budgeted.

Meanwhile, Mr Craig said an outside party, which cannot be named, has been looking at possibly making an offer for some or all of the company.

"The purpose of the due diligence is to enable the third party to assess the potential acquisition of all or substantially all the shares in, or assets, of Comvita, whether by way of takeover, scheme of arrangement, amalgamation or other business combination."

He said the process was coming to an end, but there was no certainty that an offer would be made.

"The third party approach was, and remains, an incomplete proposal."

Chinese interests have minority stakes in Comvita, which has significant direct sales to China as well as through grey market channels.