Half year loss sour for Comvita

Honey producer Comvita is not letting a ‘‘painful’’ stage dull its confidence in the future of the company.

Comvita chair Neil Craig announced to investors a net, after-tax loss of $7.1 million on sales of $57.7m for the six months ending December 31, citing belowexpectation sales through ‘‘informal’’ or distributor channels in China, rather than company sales, for the poor interim result.

The Te Puke based company is also experiencing the poorest honey harvest in decades after wet spring and summer weather.

Comvita chief executive Scott Coulter said investors were largely understanding of the financial results, and the announcement was ‘‘putting meat on the bones’’ of what the market already knew. ’’The business operating conditions in Comvita’s two biggest markets, New Zealand and Australia, were extremely tough over the first six months of the season and account for most of the shortfall of revenue in the period.’’

He said Comvita supplies China through ‘‘informal’’ sales channels (distributors), but from July this year would be taking part in what he described the ‘‘China joint venture’’, improving both profitability from China-based sales and visibility into this market.

‘‘It has been Comvita’s strategy for a number of years to get as close to the consumer as possible.’’ Coulter said there would be a ‘‘painful’’ period of switching from informal to formal channels before profits improved, but already the second half year was looking materially better than the first. ‘‘We’ve had a really slow period, but we are seeing some nice growth in markets such as the US and Japan.’’ This year’s harvest, down 60 per cent on last year, has been exceptionally poor.