Turners and Growers has announced it's set to write down approximately $21 million of assets for the 2011 financial year, reflecting tough times for kiwifruit growers and the extinction of tax losses caused by the company’s takeover by German company BayWa.
Reflected in the writedown is the impact of the kiwifruit disease PSA, poor grower returns and global economic uncertainty, said T & G chairman, Rob Campbell in a statement.
T&G also has to write off a deferred tax asset of approximately $8 million, as a result of the takeover by German company BayWa, which launched a $1.85-a-share offer, valuing the target company at $216 million, on Dec. 9 having garnered agreement from Guinness Peat Group to sell its 63 percent stake.
The offer has since been extended until Feb. 8 after a sluggish response from minority shareholders and to give New Zealand’s Overseas Investment Office time to clear the proposal.
T&G is expected to record a loss of between $17 and $19 million for the 2011 year.
Its shares showed no change today, remaining at $1.78, where they have sat since Dec 29.
5 Comments
unfortunately RC incorrect. All turners varieties are susceptable. The exposure comes from their kiwifruit orchard investments which currently have little value due to PSA effect on the total industry. Allied to the fact they cant sell their product off shore apart from Australia and you have quite a large mal-investment. Zespri's new variety program is on the other hand well advanced with substantial plantings and production.The other issue t&G has is of course the Jazz Apple orchard investments which they are stating will bring in improved returns. To date the experiance is that the current volume has depressed prices and returns for the variety are negative to the growers. Increased volumes could make this situation worse.
No they don't wish to buy their fruit, but I did hear they want to share the spoils via the pool system. That would lead anyone to beleive T&Gs varieties or markets are worth more.
Sure to make T&Gs growers happy.
Also we seem to be hearing Zespri talk with less certainty about their new varieties, could this be because they aren't such certain winners?
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.