Produce company T&G Global expects to report a pre-tax loss of up to $34 million following damage to its Hawke’s Bay orchards from Cyclone Gabrielle.

The produce grower and exporter has forecast a pre-tax loss of $28m to $34m this year after assessing damage from February’s cyclone. It reported a pre-tax loss of $3.3m last year following heavy rains during the apple harvest and supply chain disruptions.

“This forecast allows for all known cyclone impacts (including clean-up costs) and includes a provision for the one-off write-down of trees and planting structures devastated by the event,” T&G Global chief executive Gareth Edgecombe said in a statement to the NZX.

“Significant work continues on the remediation of T&G’s impacted orchards in Hawke’s Bay, particularly in relation to the removal of silt from around trees.”

While most of the company’s owned and leased orchards were not impacted by the cyclone, four orchards were severely impacted, representing about 13% of the company’s planted hectares in Hawke’s Bay, he said. 

A further 22% of the planted hectares in Hawke's Bay were impacted to a varying extent and were expected to have reduced productive capacity for two-to-three years, he said.

Edgecombe said T&G continued to work with its insurers to assess any potential recovery.

The company’s New Zealand apple crop had been fully harvested and while its overall New Zealand supply volumes were down 19% on last year, the crop was 14% sold, and the pricing outlook appeared strong, particularly for its premium Envy apple, he said.

The company’s fresh business had started the year strongly, helped by higher prices and operational efficiencies as the company stepped up a cost-reduction programme in response to the cyclone, he said.

Source - https://www.stuff.co.nz