Shares in Costa Group have hit a record high after a massive surge in blueberry production helped the fruit and vegetable grower more than double its annual profit.
Costa's net profit in the year to June 30 of $57.7 million was up from $25.3 million in the prior year, as revenue from its production and marketing of berries, citrus, mushrooms, tomatoes and avocados increased by nine per cent.
Blueberry production soared 55 per cent from the previous year, due to a longer growing season and expansion of its farmland, and that offset a decline in raspberries caused by cooler weather in Tasmania and pest issues in north Queensland.
The price of tomatoes recovered from a challenging 2015/16, up 21 per cent.
Costa said its move to make avocados a core focus, through its joint acquisition of the Lankester Avocados orchards and packing operation completed in July, will bring in earnings growth in 2017/18.
The company expects to generate around 10 per cent growth in profit, excluding movements in the value of its crops and material items, in 2017/18.
Further expansion of its blueberry and mushroom operations are also expected to result in longer term growth.
Costa shares gained 28 cents, or 5.7 per cent, to $5.21, their highest level since listing on the share market in 2015.
BERRY GOOD YEAR FOR COSTA:
* Net profit of $57.7m vs. $25.3m
* Revenue up 10.6pct to $909.1m*
* Final dividend up 1 cent to 7 cents, fully franked
