WELLINGTON: Recently listed poultry producer Tegel has booked a record $582 million revenue, beating most aspects of its prospectus guidance.
Tegel, which began trading in 1961 and listed on the NZX in May, also said it was “well positioned” to meet its 2017 targets.
For its year to April, revenue was ahead of prospectus forecast by $1.3million at $582.4million and underlying earnings before interest, tax, depreciation and amortisation (ebitda) were $200,000 ahead of prospectus at $74.9million.
After-tax profit was up $2.6million on last year’s result at $11.3million, the latter being ahead of prospectus by $1.3million. Tegel chief executive Phil Hand said all divisions had delivered strong sales growth and operational efficiencies to achieve the result. “Revenue growth continues to be driven by strong, growing demand for poultry as a meat protein in New Zealand and globally and record sales in Tegel’s key export markets.”
Since listing, Tegel has met customers in the Philippines and Japan and market access had been opened to Bahrain and South Africa. Tegel shares traded around $1.66 to $1.69 following the announcement.
Craigs Investment Partners broker Peter McIntyre said key for Tegel from the result was having met, or bettered, its prospectus forecasts, and its development of export potential.
“Its focus on exports, as it said in its listing prospectus, is to take advantage of offshore opportunities, like Bahrain and South Africa” he said.
Mr Hand said domestic revenue growth was driven by general market demand, plus securing two major supply contracts during the year. Tegel processes about 50 million birds a year and has approximately 50% market share in New Zealand, under brands Tegel, Rangitikei and Top Hat. Export sales were strong in Australia, the Pacific Islands and United Arab Emirates. Tegel was “well positioned to deliver the full year 2017 forecast,” Mr Hand said.
In its initial public offering, Tegel raised $284million, with $129million to repay existing shareholders, $130million to pay off debt and $23.3million on listing costs.
Tegel was taken public by its second private equity owner after Affinity acquired Tegel in a leveraged buyout from Pacific Equity Partners and ANZ Capital in early 2011. PEP had, in turn, bought Tegel from HJ Heinz in 2005, BusinessDesk reported.
