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Zespri’s 2022/23 Financial Results Show Challenges Facing Kiwifruit Sector

June 12, 2023

On May 30, Zespri released its 2022/23 financial results, showing that the company’s net profit after tax stood at only NZ$237.8 million (US$145.5 million), representing a significant decline from the record high of NZ$361.5 million (US$221.2 million) registered in the 2021/22 fiscal year.

According to the financial report, Zespri’s global fruit sales revenue reached NZ$3.92 billion (US$2.40 billion) in 2022/23, corresponding to a 2.7% decrease from the record-breaking NZ$4.03 billion (US$2.47 billion) achieved in 2021/22. Meanwhile, the company’s global sales volume dropped from 201.5 million trays to 183.5 million trays, and its global operating revenue (including license revenue) shrank by 5.6% to NZ$4.22 billion (US$2.58 billion).

The financial report reflects what has proved to be a difficult period for the global kiwifruit sector. Grower returns have been negatively affected by fruit quality issues, mainly stemming from the industry’s severe labor shortage, along with challenges related to cost increases and supply chain management. The quality costs incurred by Zespri increased to NZ$534 million (US$327 million) in the 2022/23 fiscal year from the NZ$307 million (US$188 million) in the 2021/22 fiscal year.

For Zespri’s overseas suppliers, sales figures decreased from NZ$537 million (US$329 million) in the 2021/22 fiscal year to NZ$519 million (US$318 million) in 2022/23. This suggests that Zespri’s overseas producing regions faced similar challenges to those in New Zealand. During this period, Italian growers reportedly encountered extremely hot weather and witnessed some of the highest quality costs in recent years.

Dan Mathieson, the company’s CEO, stated that these results demonstrate the extremely difficult period that many primary industries have been going through, during which growers have had to deal with challenges arising from labor shortages, the ongoing impacts of COVID-19, climate conditions and escalating costs.

Mathieson further emphasized that the diminished kiwifruit production for the 2023/24 season presents another challenge for growers, particularly those involved in green kiwifruit cultivation. Nevertheless, he said that Zespri is prepared to regain momentum and enhance returns for growers, the kiwifruit sector and New Zealand’s economy as a whole. The initial shipments of the 2023/24 season have reportedly received positive feedback from customers, suggesting that the industry’s Quality Action Plan has been effective in reducing quality costs and ensuring the quality of exported fruit.

Image: Zespri

This article was translated from Chinese. Read the original article.

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