Corporate: Almonds have made Select Harvests a $20 million HY profit

Select Harvests (ASX: SHV) announced its six-month results (for 1 October to 31 March) this morning and it seems almonds are money-makers.

The company announced earnings pre-tax of $38.5 million and a net profit after tax of $20.0 million.

While Australia’s retail sector has struggled in recent months, this has not hindered the almond industry. Additionally, its overseas markets in Europe and China have held their ground.

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Select Harvests has also been helped by good growing and harvest conditions conditions and its investment in new orchard technologies.

In 2019, it anticipates producing 20,750 million tonnes of almonds, up 32 per cent from the year prior. 50 per cent of this has been completed already.

A 6 per cent increase in almond prices (from $8.05/kg to $8.50/kg) also helped. This meant it was able to offset a significant increase in the price of water – 39 per cent according to the company.

Managing director Paul Thompson said he was “very pleased that our ongoing focus on improved horticultural practices and targeted investments has led to an improved outcome”.

He also predicted the full year result would be just as positive, noting that 80 per cent of the crop had been contracted for sale at the higher prices and was hedged to the USD at favourable rates.

“Looking forward our tree health is excellent, we have more volume coming on stream from our greenfield orchards at the same time among pricing remains firm,” he said.

“We will continue to focus on bringing new products to market in the Food Division and further expand our industrial customer base. We continue to look for ways to grow and maximise company returns.”

Shares only jumped 1 cent at market open but are now up 30 per cent since mid-October.

In other ASX corporate news today

Other companies that announced financial results did not have it as rosy. Thorn Group (ASX: TGA), the operator of Radio Rentals, Thorn Business Finance and Cash Flow It Group, announced a $14.9m loss for the 1 April-31 March financial year.

The company blamed challenging trading and debt collection as well as asset impairments. CEO Tim Luce asserted the outlook was positive for the company as conditions improved and a key Radio Rentals competitor was exiting the market. They expected to be profitable next financial year.

Yesterday they responded to an Australian report about their strategic review saying no decisions had been made.

Cloud technology provider OneMarket (ASX: OMN) announced a loss of $92 million. But as is common with small tech companies, it noted
increased user uptake – “more than 30 retailers and venues, over 100 brands and millions of consumers” were using its platform. The company anticipated it could meet its cash needs until late 2021 with its current reserves.

Nearly three months since the Vietnam casino operated by Silver Heritage Group (ASX: SVH) was closed, the company is beginning to receive compensation. It received an initial payment of $US200,000 and is working to receive the full amount owed.

While Silver Heritage also has operations in Nepal it announced it’s looking for a strategic partner or a buyer. While it has a significant amount of debt and “cessation of a material part of the Company’s business” is a default condition, the company has not received a notification. It believes it could operate as a going concern and could raise additional capital.

The company has been suspended since late February when it failed to lodge its accounts on time.