Interim Report
2024
Contents
Chair and CEO review | 4 | ||
Financials | |||
Income statement | 8 | ||
Statement of comprehensive income | 9 | ||
Statement of changes in equity | 10 | ||
Balance sheet | 12 | ||
Statement of cash flows | 14 | ||
Notes to the financial statements | 17 | ||
Chair and CEO review
Kia ora and welcome to T&G's six month update to 30 June 2024.
Over the first half of the year we made solid progress delivering our strategy and navigating and adjusting to the market and macro-economic conditions as we continue to recover from the impact of Cyclone Gabrielle.
The investment and mahi put in over the last five years to build the foundations for our growth has set us up well and we are seeing the benefits of this in our Apples and T&G Fresh businesses. We are very pleased with the performance of our new state-of-the-art Hawke's Bay packhouse and our Queensland berry farm in this financial period and look forward to them delivering increased returns going forward.
It has however been a slower than expected start to the year due to the lingering impacts of the cyclone, which has reduced our Hawke's Bay apple volumes. We have also experienced weak fruit and vegetable pricing in the domestic market due to plentiful supply coupled with current economic conditions. This impacted our financial results for the period.
Total revenue for the Group was $820.1 million, an increase of 7% from $765.3 million in the comparable half year. Operating loss was $2.6 million, compared to a loss of $11.6 million in 2023, and there was a loss before income tax of $8.2 million compared to a loss of $21.4 million in the year prior.
Net loss after tax for the period was $18.6 million, including a tax expense of $10.4 million. Tax expense as of 30 June 2024 includes a one-off,non-cash adjustment for deferred tax on buildings of $12.7 million. This relates to the New Zealand Government enacting changes to local tax legislation to remove the ability for entities to depreciate commercial buildings with a useful life over 50 years for tax deduction purposes.
Apples performance
Revenue in our Apples business increased 14% to $589 million, compared to $518 million in 2023.
This season's Aotearoa New Zealand-grown apples are high quality, with the fruit flavour profile and storability among the best we have seen in a number of years. Fruit colour is generally good, although some Hawke's Bay
ENVY™ apples did not develop their full colour. However, as noted, commensurate with the industry-wide experience, our Hawke's Bay crop is smaller in size and our packout subsequently reduced. Following last year's launch of
our premium JOLI™ apple, we have begun developing
20 hectares of our Hawke's Bay orchards. This year, six hectares will be put in the ground, with further plantings over the next few years.
It is the first full season for both our new Whakatu packhouse and Kotahi leading the procurement of our ocean freight services. The packhouse is operating at planned efficiency levels, and continues to improve. We expect it to be a strong contributor to profitability in the coming years as volumes increase. Working with Kotahi has enabled us to realise cost savings and logistical efficiencies, and with this year's disruptions in the Red Sea and Panama Canal, it has helped minimise the impact on us and our growers.
With the high quality 2023/2024 North American ENVY™ apple crop, the brand is holding up exceptionally well in the challenging domestic market. Despite increased price and competition pressures accompanying the large volumes in the United States, ENVY™ apples are out-performing other premium brands in both pricing and sales.
In Asia, the North American crop experienced strong export sales. Having now transitioned to supplying the region with Aotearoa New Zealand-grown apples, we expect this momentum to continue throughout the season.
The reduced volumes out of Aotearoa New Zealand have further increased our focus on optimising efficiencies across our Apple operations. As part of this, we have made improvements in our inventory management and market planning, and we expect to see the financial benefits flow through in the second half of the year.
We continue to work through our Cyclone Gabrielle insurance claim and expect to have this resolved within the financial year.
4 | 5 | |
T&G Fresh performance
T&G Fresh, our Australasian business, saw its revenue decrease to $218 million, compared to $232 million in the prior year.
Despite our Fijian and Pacific Islands business continuing to trade well, weak consumer sentiment in Aotearoa New Zealand - coupled with abundant produce given favourable growing conditions - means it has been a difficult trading period in Aotearoa New Zealand, with soft prices. In addition, our tomato volumes were reduced, largely due to the impact of whitefly.
As part of our fresh produce category strategy, in February we signed an agreement to acquire some of the assets of Hintons Orchard in Central Otago. This includes leasing 159 hectares of cherry, apricot, nectarine, peach, plum and peacharine trees, as well as their packhouse, with the summerfruit being sold domestically and in Asia.
The transaction takes effect on 1 August, in time for the 2024/2025 season.
Initial production from our Queensland berry farm, which currently consists of 20 planted hectares, is coming online. At this point in the season, indications are good for a high yield and strong prices and we look forward to
the new plantings further contributing to this. The entire farm is planted with unique blueberry varieties licensed by VentureFruit®, which are outstanding performers in terms of size, flavour, colour and shelf life.
This year we are expanding the farm and planting an additional 20 hectares of tunnel and netted plantings. The project is progressing well and we expect it to be completed by year end.
Our T&G Fresh business, as with all parts of our business, is also continuing to focus on maximising operational efficiencies to reduce its cost-to-serve.
VentureFruit® performance
VentureFruit® continues to explore opportunities globally to license and sell its unique apple, pear, berry and grape varieties. Revenue in the first half of the year was
$4 million, compared to $5.3 million in the comparable 2023 period. While licensing revenue is down given the macro-economic environment, new licensed plantings in Aotearoa New Zealand, the United States and China demonstrate continued strong demand for our premium ENVY™ and JOLI™ apples.
Outlook
Our strategy is set and over the last few years we have invested significantly to set the foundations for our growth. Our focus is now on execution to drive performance and growth into the future.
At this point in the season, the 2024/2025 North American apple crop looks to be good quality, with fruit developing well despite low water supply. It's estimated our volumes will be around 5.5 million TCEs, a 17% increase on the prior year.
It is encouraging to see the early signs of easing inflation, which will have a consequential impact on interest rates. Not only will this help ease our own cost pressures, but it will benefit many New Zealanders. From this, we would expect to see improved consumer demand and prices.
Last year's cyclone and this year's reduced apple volumes - in spite of a largely favourable growing season - have highlighted the need to continue to develop resilience across our business. This will put T&G in a strong position, regardless of external factors.
We have a great team and they have responded strongly, looking for opportunities to reduce costs, continually optimise efficiencies and grow revenue, and develop pathways to help achieve our Kaitiakitanga sustainability targets to ensure we meet our medium-term strategic and financial objectives.
We look forward to seeing the outcome of this mahi in delivering our growth aspirations.
Benedikt Mangold
Chair (left)
Gareth Edgecombe
Chief Executive Officer (right)
6 | 7 | |
Income statement
For the six months ended 30 June 2024
Unaudited | Unaudited | Audited | ||
6 months to | 6 months to | 12 months to | ||
30 Jun 2024 | 30 Jun 2023 | 31 Dec 2023 | ||
Notes | $'000 | $'000 | $'000 | |
Revenue from contracts with customers | 3 | 820,080 | 765,267 | 1,334,338 |
Other operating income | 6,918 | 13,793 | 13,749 | |
Purchases, raw materials and consumables used | (642,381) | (610,943) | (1,007,373) | |
Employee benefits expenses | (101,851) | (95,674) | (182,974) | |
Depreciation and amortisation expenses | (30,464) | (28,880) | (58,629) | |
Other operating expenses | (54,933) | (55,189) | (144,690) | |
Operating loss | (2,631) | (11,626) | (45,579) | |
Financing income | 3,096 | 2,273 | 4,090 | |
Financing expenses | (17,661) | (12,403) | (28,924) | |
Share of loss from joint ventures | 7 | - | - | (39) |
Share of profit from associates | 7 | 1,145 | 378 | 1,206 |
Other income | 7,829 | - | 17,359 | |
Other expenses | - | (8) | (12,362) | |
Loss before income tax | (8,222) | (21,386) | (64,249) | |
Income tax (expense) / credit | 4 | (10,413) | 5,716 | 17,654 |
Loss after income tax | (18,635) | (15,670) | (46,595) | |
Attributable to: | ||||
Equity holders of the Parent | (21,426) | (17,726) | (51,155) | |
Non-controlling interests | 2,791 | 2,056 | 4,560 | |
Loss for the period | (18,635) | (15,670) | (46,595) | |
Earnings per share (in cents) | ||||
Basic and diluted loss | (17.5) | (14.5) | (41.7) | |
The accompanying notes form an integral part of these interim financial statements.
FINANCIALS
Statement of comprehensive income
For the six months ended 30 June 2024
Unaudited | Unaudited | Audited | |
6 months to | 6 months to | 12 months to | |
30 Jun 2024 | 30 Jun 2023 | 31 Dec 2023 | |
$'000 | $'000 | $'000 | |
Loss for the period | (18,635) | (15,670) | (46,595) |
Other comprehensive income | |||
Items that will not be reclassified subsequently to profit or loss: | |||
Loss on revaluation of property, plant and equipment: | |||
Held by subsidiaries of the Group | (1,085) | (4,300) | (21,128) |
Deferred tax effect on revaluation of property, plant and equipment | 304 | (92) | 3,824 |
Deferred tax effect on sale of property, plant and equipment | - | 957 | (201) |
(781) | (3,435) | (17,505) | |
Items that may be reclassified subsequently to profit or loss: | |||
Exchange differences on translation of foreign operations | 1,970 | 3,823 | 5,834 |
Cash flow hedges: | |||
Fair value (loss) / gain, net of tax | (9,111) | (8,256) | 3,823 |
Reclassification of net change in fair value to profit or loss | 98 | 33 | 673 |
(7,043) | (4,400) | 10,330 | |
Other comprehensive expense for the period | (7,824) | (7,835) | (7,175) |
Total comprehensive expense for the period | (26,459) | (23,505) | (53,770) |
Total comprehensive expense for the period is attributable to: | |||
Equity holders of the Parent | (29,660) | (26,401) | (56,945) |
Non-controlling interests | 3,201 | 2,896 | 3,175 |
(26,459) | (23,505) | (53,770) | |
The accompanying notes form an integral part of these interim financial statements.
8 | 9 | |
Statement of changes in equity
For the six months ended 30 June 2024
2024 | Unaudited | ||||||
Revaluation | Non- | ||||||
Share | and other | Retained | controlling | Total | |||
capital | reserves | earnings | Total | interests | equity | ||
Notes | $'000 | $'000 | $'000 | $'000 | $'000 | $'000 | |
Balance at 1 January 2024 | 176,357 | 100,296 | 227,764 | 504,417 | 17,471 | 521,888 | |
(Loss) / profit for the period | - | - | (21,426) | (21,426) | 2,791 | (18,635) | |
Other comprehensive income / (expense) | |||||||
Revaluation of property, plant and equipment | - | (1,085) | - | (1,085) | - | (1,085) | |
Deferred tax effect on revaluation of property, | - | 304 | - | 304 | - | 304 | |
plant and equipment | |||||||
Exchange differences on translation of | - | 1,561 | - | 1,561 | 409 | 1,970 | |
foreign operations | |||||||
Movement in cash flow hedge reserve | - | (9,014) | - | (9,014) | 1 | (9,013) | |
Total other comprehensive (loss) / income | - | (8,234) | - | (8,234) | 410 | (7,824) | |
Transactions with owners | |||||||
Dividends | 6 | - | - | - | - | (2,948) | (2,948) |
Investment from non-controlling interest | - | - | - | - | 522 | 522 | |
Total transactions with owners | - | - | - | - | (2,426) | (2,426) | |
Transfer from asset revaluation reserve due | - | (11,675) | 11,675 | - | - | - | |
to asset disposal | |||||||
Balance at 30 June 2024 | 176,357 | 80,387 | 218,013 | 474,757 | 18,246 | 493,003 | |
The accompanying notes form an integral part of these interim financial statements.
FINANCIALS
2023 | Unaudited | ||||||
Revaluation | Non- | ||||||
Share | and other | Retained | controlling | Total | |||
capital | reserves | earnings | Total | interests | equity | ||
Notes | $'000 | $'000 | $'000 | $'000 | $'000 | $'000 | |
Balance at 1 January 2023 | 176,357 | 115,221 | 271,673 | 563,251 | 16,917 | 580,168 | |
(Loss) / profit for the period | - | - | (17,726) | (17,726) | 2,056 | (15,670) | |
Other comprehensive income / (expense) | |||||||
Revaluation of property, plant and equipment | - | (4,300) | - | (4,300) | - | (4,300) | |
Deferred tax effect on revaluation of property, | - | (92) | - | (92) | - | (92) | |
plant and equipment | |||||||
Deferred tax on sale of property, plant | - | 957 | - | 957 | - | 957 | |
and equipment | |||||||
Exchange differences on translation of | - | 2,988 | - | 2,988 | 835 | 3,823 | |
foreign operations | |||||||
Movement in cash flow hedge reserve | - | (8,228) | - | (8,228) | 5 | (8,223) | |
Total other comprehensive (loss) / income | - | (8,675) | - | (8,675) | 840 | (7,835) | |
Transactions with owners | |||||||
Dividends | 6 | - | - | - | - | (3,679) | (3,679) |
Investment from non-controlling interest | - | - | - | - | 766 | 766 | |
Total transactions with owners | - | - | - | - | (2,913) | (2,913) | |
Transfer from asset revaluation reserve due | - | (7,246) | 7,246 | - | - | - | |
to asset disposal | |||||||
Balance at 30 June 2023 | 176,357 | 99,300 | 261,193 | 536,850 | 16,900 | 553,750 | |
The accompanying notes form an integral part of these interim financial statements.
10 | 11 | |
Balance sheet
As at 30 June 2024
Unaudited | Unaudited | Audited | ||
30 Jun 2024 | 30 Jun 2023 | 31 Dec 2023 | ||
Notes | $'000 | $'000 | $'000 | |
Current assets | ||||
Cash and cash equivalents | 53,431 | 48,242 | 30,508 | |
Term deposits | 3,417 | 2,528 | 2,277 | |
Trade and other receivables | 236,958 | 220,547 | 196,810 | |
Inventories | 164,916 | 138,426 | 67,640 | |
Taxation receivable | 13,286 | 19,506 | 9,737 | |
Derivative financial instruments | 3,656 | 1,870 | 7,110 | |
Biological assets | 14,007 | 10,058 | 28,249 | |
Non-current assets classified as | held for sale | 8,280 | 12,000 | 11,100 |
Total current assets | 497,951 | 453,177 | 353,431 | |
Non-current assets | ||||
Trade and other receivables | 38,974 | 63,998 | 44,610 | |
Derivative financial instruments | 9,396 | 11,205 | 13,268 | |
Deferred tax assets | 4 | 1,370 | 1,471 | 2,574 |
Investments in unlisted entities | 79 | 86 | 92 | |
Property, plant and equipment | 5 | 394,519 | 431,503 | 401,007 |
Right-of-use assets | 159,032 | 144,276 | 148,592 | |
Intangible assets | 78,374 | 79,023 | 79,692 | |
Investments in joint ventures | 7 | 2,945 | 3,184 | 2,927 |
Investments in associates | 7 | 30,164 | 30,426 | 29,019 |
Total non-current assets | 714,853 | 765,172 | 721,781 | |
Total assets | 1,212,804 | 1,218,349 | 1,075,212 | |
Current liabilities | ||||
Trade and other payables | 221,299 | 212,419 | 171,644 | |
Loans and borrowings | 111,200 | 113,500 | 34,294 | |
Lease liabilities | 22,621 | 24,052 | 22,051 | |
Taxation payable | 7,715 | 10,452 | 3,161 | |
Derivative financial instruments | 1,974 | 11,858 | 955 | |
Total current liabilities | 364,809 | 372,281 | 232,105 | |
The accompanying notes form an integral part of these interim financial statements.
FINANCIALS
Unaudited | Unaudited | Audited | ||
30 Jun 2024 | 30 Jun 2023 | 31 Dec 2023 | ||
Notes | $'000 | $'000 | $'000 | |
Non-current liabilities | ||||
Trade and other payables | 44 | 46 | 43 | |
Loans and borrowings | 181,916 | 126,967 | 163,144 | |
Lease liabilities | 162,864 | 145,058 | 151,816 | |
Derivative financial instruments | 735 | 1,565 | 234 | |
Deferred tax liabilities | 4 | 9,433 | 18,682 | 5,982 |
Total non-current liabilities | 354,992 | 292,318 | 321,219 | |
Total liabilities | 719,801 | 664,599 | 553,324 | |
Equity | ||||
Share capital | 176,357 | 176,357 | 176,357 | |
Revaluation and other reserves | 80,387 | 99,300 | 100,296 | |
Retained earnings | 218,013 | 261,193 | 227,764 | |
Total equity attributable to equity holders of the Parent | 474,757 | 536,850 | 504,417 | |
Non-controlling interests | 18,246 | 16,900 | 17,471 | |
Total equity | 493,003 | 553,750 | 521,888 | |
Total liabilities and equity | 1,212,804 | 1,218,349 | 1,075,212 | |
The accompanying notes form an integral part of these interim financial statements.
Approved for and on behalf of the Board
B.J. Mangold | C.A. Campbell |
Director (Chair) | Director (Chair of Finance, Risk and Investment Committee) |
9 August 2024 | 9 August 2024 |
12 | 13 | |
Statement of cash flows
For the six months ended 30 June 2024
Unaudited | Unaudited | Audited | ||
6 months to | 6 months to | 12 months to | ||
30 Jun 2024 | 30 Jun 2023 | 31 Dec 2023 | ||
Notes | $'000 | $'000 | $'000 | |
Cash flows from operating activities | ||||
Cash was provided from: | ||||
Cash receipts from customers | 791,647 | 716,193 | 1,348,709 | |
Cash receipts from insurance proceeds | 1,781 | - | 4,060 | |
Other | 2,332 | 546 | 2,320 | |
Cash was disbursed to: | ||||
Payments to suppliers and employees | (801,269) | (720,940) | (1,317,715) | |
Interest paid | (6,521) | (4,598) | (11,751) | |
Income taxes paid | (1,095) | - | (60) | |
Net cash outflow / (inflow) from operating activities | (13,125) | (8,799) | 25,563 | |
Cash flows from investing activities | ||||
Cash was provided from: | ||||
Cash receipts from insurance proceeds | 5,976 | - | 1,355 | |
Dividends received from joint ventures and associates | - | - | 2,235 | |
External loan repayments from suppliers, customers, | 461 | 365 | 481 | |
associates and joint ventures | ||||
Investment from non-controlling interest | 522 | 766 | 1,158 | |
Sale of other property, plant and equipment | 429 | 535 | 767 | |
Sale of Pukekohe property | 10,799 | - | - | |
Sale of non-current assets held for sale | - | 15,150 | - | |
Sale of Palmerston North property | - | - | 12,000 | |
Cash was disbursed to: | ||||
Purchase of property, plant and equipment | 5 | (11,347) | (36,698) | (68,510) |
Purchase of intangible assets | (517) | (3,781) | (7,560) | |
Loans to suppliers, customers, associates and joint ventures | (200) | (302) | (302) | |
Current term deposits | (1,140) | (1,418) | (1,167) | |
Net cash inflow / (outflow) from investing activities | 4,983 | (25,383) | (59,543) | |
The accompanying notes form an integral part of these interim financial statements.
FINANCIALS
Unaudited | Unaudited | Audited | ||
6 months to | 6 months to | 12 months to | ||
30 Jun 2024 | 30 Jun 2023 | 31 Dec 2023 | ||
Notes | $'000 | $'000 | $'000 | |
Cash flows from financing activities | ||||
Cash was provided from: | ||||
Net proceeds from short-term borrowings | 5,200 | 14,900 | 9,400 | |
Proceeds from long-term borrowings | 13,000 | 5,000 | 30,000 | |
Proceeds from seasonal funding | 73,000 | 75,000 | - | |
Proceeds from Ultimate Parent borrowings | 6,000 | - | 11,000 | |
Cash was disbursed to: | ||||
Dividends paid to non-controlling interests | 6 | (2,948) | (3,679) | (5,668) |
Repayment of long-term borrowings | (620) | (2,218) | (1,018) | |
Repayment of lease liabilities | (19,854) | (16,708) | (37,383) | |
Seasonal advances to growers | (42,293) | (47,881) | - | |
Bank facility fees and transaction fees | (1,892) | (2,051) | (4,348) | |
Net cash inflow from financing activities | 29,593 | 22,363 | 1,983 | |
Net increase / (decrease) in cash and cash equivalents | 21,451 | (11,819) | (31,997) | |
Foreign currency translation adjustment | 1,472 | 2,652 | 5,096 | |
Cash and cash equivalents at the beginning of the year | 30,508 | 57,409 | 57,409 | |
Cash and cash equivalents at the end of the period | 53,431 | 48,242 | 30,508 | |
The accompanying notes form an integral part of these interim financial statements.
14 | 15 | |
Statement of cash flows (continued)
Reconciliation of loss after income tax to net cash flow from operating activities
Unaudited | Unaudited | Audited | ||
6 months to | 6 months to | 12 months to | ||
30 Jun 2024 | 30 Jun 2023 | 31 Dec 2023 | ||
Notes | $'000 | $'000 | $'000 | |
Loss for the period | (18,635) | (15,670) | (46,595) | |
Adjusted for non-cash items: | ||||
Amortisation expense | 2,229 | 2,349 | 4,736 | |
Depreciation expense | 28,235 | 26,531 | 53,893 | |
Movement in deferred tax | 5,219 | (7,279) | (19,413) | |
Movement in expected credit loss allowance | (6,185) | 5 | 16,142 | |
Revenue from sale of licences | (199) | (1,163) | (493) | |
Share of loss of joint ventures | 7 | - | - | 39 |
Share of profit of associates | 7 | (1,145) | (377) | (1,206) |
Other movements | (8,221) | 2,489 | (9,795) | |
19,933 | 22,555 | 43,903 | ||
Adjusted for investing and financing activities: | ||||
Bank facility and line fees | 1,892 | 2,050 | 4,349 | |
Fair value adjustment of asset held for sale | - | - | 870 | |
Impairment of loan | - | - | 5,205 | |
Loss on assets damaged from Cyclone Gabrielle | - | - | 12,362 | |
(Gain) / loss on disposal of other property, plant and equipment | 5 | (62) | 8 | (238) |
Net loss from property, plant and equipment revaluation | - | 5 | 253 | |
changes through profit and loss | ||||
Insurance proceeds | (5,976) | - | (1,355) | |
(4,146) | 2,063 | 21,446 | ||
Impact of changes in working capital items net of effects | ||||
of non-cash items, and investing and financing activities: | ||||
Increase in debtors and repayments | (20,432) | (47,211) | (15,875) | |
Decrease / (increase) in biological assets | 14,242 | 17,545 | (646) | |
Increase in creditors and provisions | 92,184 | 99,242 | 37,388 | |
Increase in inventories | (97,276) | (84,496) | (13,709) | |
Decrease / (increase) in net taxation receivable | 1,005 | (2,827) | (349) | |
(10,277) | (17,747) | 6,809 | ||
Net cash (outflow) / inflow from operating activities | (13,125) | (8,799) | 25,563 | |
FINANCIALS
Notes to the financial statements
1. Basis of preparation
Reporting entity and statutory base
T&G Global Limited (the Parent) and its subsidiary companies (the Group), are recognised as one of New Zealand's leading growers, distributors, marketers and exporters of premium fresh produce. Key categories for the Group include apples, berries, citrus (lemons, mandarins and navel oranges) and tomatoes.
These unaudited condensed interim financial statements presented are for the Group which comprises the Parent and its subsidiaries, joint ventures and associates as at 30 June 2024.
The Parent is registered in New Zealand under the Companies Act 1993 and is a FMC Reporting Entity under the Financial Market Conducts Act 2013, and the Financial Reporting Act 2013.
The Parent is a limited liability company incorporated and domiciled in New Zealand and is listed on the New Zealand Stock Exchange. The address of its registered office is Building 1, Level 1, Central Park, 660 Great South Road, Ellerslie, Auckland.
BayWa Global Produce GmbH (the Immediate Parent) and BayWa Aktiengesellschaft (the Ultimate Parent) are the parents of the Group and are based in Munich, Germany.
Statement of compliance
These unaudited condensed interim financial statements have been prepared in accordance with New Zealand Generally Accepted Accounting Practice (NZ GAAP), NZ IAS 34 Interim Financial Reporting and IAS 34 Interim Financial Reporting. The unaudited condensed interim financial statements should be read in conjunction with the annual report for the year ended
31 December 2023 (2023 Annual Report), which has been prepared in accordance with New Zealand equivalents to International Financial Reporting Standards (NZ IFRS) and other applicable New Zealand Financial Reporting Standards as appropriate for profit-oriented entities, and International Financial Reporting Standards (IFRS). The accounting policy information used in the preparation of these unaudited condensed interim financial statements are consistent with those used in the 2023 Annual Report.
These unaudited condensed interim financial statements are expressed in New Zealand dollars which is the presentation currency of the Group. All financial information has been rounded to the nearest thousand ($'000) unless otherwise stated.
Critical accounting estimates and judgments
The Group makes estimates and judgments concerning the future. The resulting accounting estimates may, by definition, not equal the related actual results. The estimates and judgments used in the preparation of these unaudited condensed interim financial statements are consistent with those used in the 2023 Annual Report.
2. Segment information
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision- makers. The chief operating decision-makers have been identified as the Chief Executive Officer, the Chief Financial Officer and the Executive team of the Group.
The chief operating decision-makers assess the performance of the operating segments based on operating profit, which reflects earnings before financing income and expenses, share of profit from joint ventures and associates, other income, other expenses and income tax expense. Inter-segment pricing is determined on an arm's length basis and segment results include items directly attributable to a segment.
During the period, the Group reorganised its operating segments leading to the International Trading segment being aggregated into the Group's remaining operating segments. The aggregation was based on similarities of economic characteristics, particularly the similarities of long-term gross profit margins, nature of the products and services, methods of distribution of products and provision of services to customers, and markets involved.
No single external customer's revenue accounts for 10% or more of the Group's revenue.
16 | 17 | |
Notes to the financial statements (continued)
Operating segments
The Group comprises the following main operating segments:
Operating segment | Significant operations |
FINANCIALS
Apples | T&G Fresh | VentureFruit® | Other | Total | |
$'000 | $'000 | $'000 | $'000 | $'000 | |
Unaudited six months ended 30 June 20231 | |||||
Total segment revenue | 590,280 | 270,673 | 20,566 | 10,207 | 891,726 |
Inter-segment revenue | (72,103) | (39,064) | (15,292) | - | (126,459) |
Apples
T&G Fresh
VentureFruit®
Growing, packing, cool storing, sales and marketing of apples worldwide. Includes international trading activities in Asia and North America.
Growing, trading and transport activities within New Zealand and Australia, and exports to the Pacific Islands, Australia and Asia. This incorporates the New Zealand wholesale markets and the tomato, citrus and berry growing operations. This includes international trading activities in Australia.
Variety management including identification, acquisition, development and protection of new varieties of fruit. Revenue from the sale of right-to-grow licenses is included in this business division.
Revenue from external customers | 518,177 | 231,609 | 5,274 | 10,207 | 765,267 |
Purchases, raw materials and consumables used | (439,271) | (154,658) | (5,573) | (11,441) | (610,943) |
Depreciation and amortisation expenses | (14,707) | (12,703) | (66) | (1,404) | (28,880) |
Net other operating expenses | (61,763) | (52,552) | (6,044) | (16,711) | (137,070) |
Segment operating profit / (loss) | 2,436 | 11,696 | (6,409) | (19,349) | (11,626) |
Financing income | 2,273 |
Other | Includes non-Apple related international trading activities in Asia, property and corporate costs. |
Segment information provided to the chief operating decision-makers for the reportable segments is shown in the following tables:
Apples | T&G Fresh | VentureFruit® | Other | Total | |
$'000 | $'000 | $'000 | $'000 | $'000 | |
Unaudited six months ended 30 June 2024 | |||||
Total segment revenue | 661,955 | 226,927 | 24,230 | 8,809 | 921,921 |
Inter-segment revenue | (72,966) | (8,597) | (20,278) | - | (101,841) |
Revenue from external customers | 588,989 | 218,330 | 3,952 | 8,809 | 820,080 |
Purchases, raw materials and consumables used | (469,682) | (156,451) | (5,213) | (11,035) | (642,381) |
Depreciation and amortisation expenses | (16,504) | (12,614) | (104) | (1,242) | (30,464) |
Net other operating expenses | (79,047) | (60,555) | (2,063) | (8,201) | (149,866) |
Segment operating profit / (loss) | 23,756 | (11,290) | (3,428) | (11,669) | (2,631) |
Financing income | 3,096 | ||||
Financing expenses | (17,661) | ||||
Share of profit from associates | 1,145 | ||||
Net other income | 7,829 | ||||
Loss before income tax | (8,222) | ||||
Financing expenses | (12,403) |
Share of profit from associates | 378 |
Net other income | (8) |
Loss before income tax | (21,386) |
Apples | T&G Fresh | VentureFruit® | Other | Total | |
$'000 | $'000 | $'000 | $'000 | $'000 | |
Audited year ended 31 December 20231 | |||||
Total segment revenue | 968,160 | 577,467 | 41,376 | 21,114 | 1,608,117 |
Inter-segment revenue | (148,274) | (93,133) | (32,372) | - | (273,779) |
Revenue from external customers | 819,886 | 484,334 | 9,004 | 21,114 | 1,334,338 |
Purchases, raw materials and consumables used | (639,902) | (335,989) | (11,526) | (19,956) | (1,007,373) |
Depreciation and amortisation expenses | (29,939) | (25,859) | (140) | (2,691) | (58,629) |
Net other operating expenses | (140,035) | (112,481) | (12,004) | (49,395) | (313,915) |
Segment operating profit / (loss) | 10,010 | 10,005 | (14,666) | (50,928) | (45,579) |
Financing income | 4,090 | ||||
Financing expenses | (28,924) | ||||
Share of loss from joint ventures | (39) | ||||
Share of profit from associates | 1,206 | ||||
Net other income | 4,997 | ||||
Loss before income tax | (64,249) | ||||
1. Prior period segment results have been re-presented to ensure consistency in the composition of business segments to reflect the Group's internal reporting. This has no impact on the income statement or other primary statements with the only impact being in the 2023 segment information presentation.
18 | 19 | |