Select Harvests Posts $31.8M Profit on 32% Almond Price Surge
Select Harvests Limited reported a robust FY2025 with a 32.4% almond price surge driving a $30.9 million NPAT increase and halving net debt. The company’s strategic investments and operational efficiencies position it well for a positive FY2026 outlook.
- NPAT rises $30.9 million to $31.8 million on almond price increase
- Operating cashflow improves by $109.1 million through supply chain gains
- Net debt reduced by 51% to $79.1 million after refinancing $240 million facility
- Production costs held flat despite inflation due to PMO initiatives
- Ongoing investments in processing capacity and harvesting technology
Strong Financial Performance Amidst Market Tailwinds
Select Harvests Limited delivered a standout FY2025 result, underpinned by a 32.4% increase in almond prices to $10.18 per kilogram. This price surge, combined with operational improvements, propelled net profit after tax (NPAT) up by $30.9 million to $31.8 million. The company’s operating cashflow also saw a remarkable $109.1 million uplift, driven by enhanced sales velocity and supply chain efficiencies that accelerated cash conversion.
Disciplined Cost Management and Debt Reduction
Despite inflationary pressures, Select Harvests managed to keep production costs flat year-on-year, thanks to the effective implementation of its Project Management Office (PMO) initiatives. This disciplined approach extended to capital management, with net debt halving to $79.1 million, supported by a strategic refinancing of a $240 million banking facility. The company’s gearing ratio improved to a conservative 15.1%, strengthening its balance sheet and financial flexibility.
Strategic Investments Driving Operational Excellence
Investments in processing capacity, notably Project Optimus phase 2, and the introduction of kernel recovery technology are enhancing Select Harvests’ ability to maximise yield and reduce waste. Additionally, new harvesting equipment, including advanced harvest shakers, is expected to improve nut removal efficiency and quality, while reducing labour costs. These initiatives not only support current profitability but also position the company for sustainable growth.
Market Outlook and Growth Prospects
The almond market outlook for FY2026 remains positive, buoyed by supply constraints in California and sustained global demand growth. Select Harvests anticipates continuing to outperform market benchmarks through price optimisation, customer channel expansion, and maintaining a low cost base. While some cost headwinds are expected from uncontrollable factors like water and bee costs, the company’s strategic focus on yield improvement and processing leadership should help preserve margins.
Governance and Transparency
The company addressed prior year restatements related to revenue recognition and superannuation underpayments, reflecting a commitment to transparency and regulatory compliance. No final dividend was declared for FY2025, signaling a focus on reinvestment and balance sheet strengthening amid ongoing transformation efforts.
Bottom Line?
Select Harvests’ FY2025 results underscore its operational resilience and strategic agility, setting the stage for continued growth in a tightening global almond market.
Questions in the middle?
- How will Select Harvests manage potential cost pressures from water and bee supply in FY2026?
- What impact will the kernel recovery line have on third-party processing volumes and margins?
- Will the company resume dividend payments as balance sheet strength improves?
