Comvita - CVT

[snackpack]

Comvita has slowly risen to $1.90 on small volume, but very few sellers. Three people bidding at $1.90 and one seller listing at $2.00 today.

[Zito]

This share has been my investment of the year. It is in a solid uptrend, which has accelerated over the past 4 months. It lacks liquidity to an extent but its holders are holding tightly - and with good reason - plenty of good news has come out of the company over the past 12 months with more expected.

[snackpack]

I have to agree as I've held on to a loss for a year or so and am relieved to see it in the green again. I read that Comvita are hiring staff again and are looking into Europe. The extreme cold snap in the Northern Hemisphere was projected to bring benefits too.

[kiwi_on_OE]

6 months to 30 Sep 08
NZ$000''s
Sales 31,650
EBITDAF 2,036
NPAT 203

6 months to 31 Mar 09
NZ$000''s
Sales 40,000
EBITDAF 4,100
NPAT 800
Debt 30,300

6 months to 30 Sep 09
Sales 40,108
EBITDAF 4,258
NPAT 1,621

6 months to 31 Mar 10
Sales 45,000
EBITDAF 6,700
NPAT 3,300
Debt 11,600

They say: -
'The significant improvement in earnings is a result of a continuing strong
trend in sales growth and ongoing improvements in overall operating
efficiencies.'

So what could be the figures for the new year? What about doubling the numbers for the last 6 mths?

Sales 90,000
EBITDAF 13,000
NPAT 6,600

Mkt cap 64m => PE ~10.

[Paint it Black]

The most pleasing aspect is the big reduction in debt from $30m to $11m - this will let the company accelerate it's growth even faster. At least NZ now has one well run company on the NZX successfully exporting overseas. Congratulations to the Board!

[snackpack]

Agreed, well done to management. I can't wrap my head around todays jump in prices. Fantastic rise.

[Zito]

Well the rise to $2.80 wasn't immediately sustainable and now CVT has drifted back to $2.35 - and with the Euro situation as a backdrop a slight correction to the SP was expected. The share seems to be finding good support at around $2.30, which I'm happy about - a fall below that would mean a change of short-term trend and would cause me to revisit my strategy with the stock.

Accordingly I have been accumulating at $2.32 - $2.35 and was very happy today to see director Robert Tait has been buying at $2.40. A nice (albeit small) vote of confidence in the direction the company is heading.

[tango]

And now they've dropped to $1.90 after CVT revised their forecast downward

I wish I had sold when they were at their peak a few months ago. I thought about it but everything was looking promising so I held them. Now I'm not so sure...

[JayRiggs]

Comvita Limited (“CVT”) wishes to provide profit guidance for the year ending 31 March 2011, as follows.



The reported net profit after tax is expected to be in the range of $0.4m profit to a $0.2m loss on forecast sales of approximately $81m. This compares with a net profit after tax of $5.0m and sales of $84.9m in the previous financial year. On a normalised basis, net profit after tax forecast range is between $2.8m and $3.4m profit (2010 - $5.7m).

The difference between the normalised and reported results comprises a number of one off items; the main ones being a non cash tax expense of $1.5m after tax to account for the change in New Zealand tax law relating to depreciation on buildings, the already announced and provided for expense of $2.2m after tax in the defence of a medical patent in the UK, a write down of intangible assets of $740k after tax and the revaluation of warrants held in Nasdaq listed Derma Sciences of $950k after tax.

Even though we have enjoyed a much improved sales trend and profit for the last quarter, the sales and profit numbers for the full six month period are lower than the same period in 2010. It has proved to be too difficult to make up for the poor results in the first half. Problems were experienced with a soft Australian retail market further impacted by the mild southern hemisphere winter and the Queensland floods. Despite the slower sales situation for the year, Comvita has continued to invest in expanding its global internet direct sales model, expanding its retail presence in growth markets and expanding its product portfolio.
Our audited result and full commentary will be provided to the market on 20 May 2011.

Anyone else hold CVT? I bought some of these when I started out investing middle of last yr. Can't say I'm pleased with this result. This UK patent lawsuit crap is costing them too much. I hope they get their sh*t sorted ASAP and get back to selling honey.

[Blendy]

yeah. it's a bit annoying. i sell their products as well, and there have been problems that can't be helped such as weather that affects honey production and products have been unavailable. And there are price increases regularly which while are justified, are now making honey etc quite expensive (eg latest price list effective today has the basic UMF5+ honey 1kg RRP $49.90, and UMF18+ 250g RRP $68.70). The patent lawsuit is a big problem too, how annoying.

Hopefully a good season this year will make lots of honey and maybe even some of the higher UMF that has been deleted (or maybe is only available to the asian market).