We are pleased to inform you that harvest was completed last Thursday (25th) and that we finished with approximately 71,500 tons of fruit producing 13.75 million litres of oil. This was in line with our forecast of 13.8 million litres. This is the most oil we have ever produced in one season and pleasingly the overall oil quality is outstanding this year. For comparison in 2013 and 2014 we produced 13.5m and 7.9m litres of oil respectively.
PROFIT
Once we have had time to finalise end of year management accounts in early August, we will be sending through a comprehensive report including expected full year profit guidance and a more detailed operational update, but in the meantime we would like to inform you of the following that will influence projected profit:
The final valuation of the oil at 30 June
Production costs, which we expect to be approximately 15% higher than last year, particularly the price of water used to irrigate the groves,
Our continuing investment in innovation, research and investments to support efficiency gains,
Our investment in establishing Boundary Bend in the USA.
The world price of olive oil has increased materially over the last 12 months (see graph below) but is yet to flow meaningfully through to domestic retail prices.
Taking all this into account it is likely that full year trading profit (pre tax) will be lower than our forecast of $25m.
Please feel free to contact me at any time if you have any questions.
