Please accept this edition of Frankly Speaking up to the end of week 45 [last Sunday night]. The year has seemingly flown by and pollination is well underway, and SunGold pollination is largely complete. Flower numbers have been good with significant flower thinning but there has been wide variation in flower maturity. Some canes have fruit set while others still have flowers opening. We are cautious about how these orchards will present at harvest time and whether we will have uneven maturity.
Hayward flowering is underway. The pollen mill is up and running, and we thank those growers who have made their orchards available for male flower picking. While Seeka has a good stock of pollen, it is important that we maintain stock going forward. Our observation in the Hayward orchards is that flowering is extremely quick this year. It’s an unusual year. An abundance of flowers across all varieties, uneven flowering in SunGold and quick flowering in Hayward.
At Seeka Growers Zespri reported Hayward sales for the past two weeks have been over 3m trays per week. The majority of the SunGold sales are now complete and for the first time this year Green weekly sales rates have been above forecast. With increasing Gold volumes, the later selling window for Green is expected again next year.
Zespri have released their latest forecast and our Grower Entities Team have busily been interpreting these into individual grower forecasts. These are the first real forecast for the year, as the earlier forecast had a number of predictive assumptions around the timing of loadouts, fruit loss, timing of fruit loss and fruit values. The fruit values being paid by Zespri have changed and these are an important factor in the returns being paid to each of our supplying orchards. The average fruit value movement per tray by variety is as follows:
SunGold – down $0.07 per tray
Hayward Conventional – down $0.10 per tray
Hayward Organic – up $0.04 per tray
Sweet Green – up $0.10 per tray
Seeka has announced a new capital raising strategy to be implemented over the course of the next 3 years. The purpose of this capital raising strategy is to strengthen Seeka’s balance sheet and provide Seeka with the financial flexibility and freedom to pursue its growth strategy.
Seeka will undertake a fully underwritten pro rata renounceable Rights Offer to raise approximately NZ$50 million of new equity via a pro rata 1 for 1.5 Rights Offer at NZ$4.25 per share (fully underwritten by First NZ Capital Group Limited).
Details of the Rights Offer (including a copy of the Offer Document) are available on Seeka’s website www.seeka.co.nz/nzx-announcements or on the NZX by searching Seeka’s stock code (SEK) at www.nzx.com/companies/SEK. Shareholders should read the Offer Document carefully and in full before deciding whether to take up their Rights, and seek professional advice if they have any queries about what they should do in respect of the Rights Offer.
The Rights Offer Documents and Applications Forms will be distributed to shareholders next week and the Rights Offer closes on 7 December. Seeka also has announced its intention to introduce a new Grower Share Scheme and Employee Share Scheme in the first quarter of 2019, to further align the interests of Seeka, its employees and grower suppliers [many of whom are shareholders].
All our growers are invited to attend our November series of After 5 Grower Updates occurring over the next two weeks. These meetings will profile the fruit performance, Orchard Gate Returns, 2019 Capacity Plans, Avocado update and the Capital Raise being undertaken by Seeka and announced yesterday. We look forward to catching up with you. There is always great company, hospitality and refreshments, with some of you even coming along to more than one!. We would ask that you RSVP so we can organise the refreshments. Please RSVP here.
The schedule of meetings is:
Kind regards
Michael
Seeka Key
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