Costa Group slammed by dip in tomato, berry and avocado sales
11 January 2019, Written by Business News Australia
Costa Group's latest trading update might have ushered in the end of an era for smashed avo lovers, and its shareholders are not particularly ripe.
The grower, packer and marketer of Australian fruit and veg announced on Thursday that sales in tomatoes, berries and avacados dipped during December 2018.
As a result, the company saw its share price dive from $7.37 on Wednesday to $4.51 at close of trade on Thursday.
This 39 per cent slashing wiped almost $1 billion off its market value in the process.
The company says trading conditions have been tough, blaming the citrus 'off season' finishing earlier than expected.
Because of the slow demand the company has had to force pricing down for a number of its key product lines.
As such, Costa has said it will reduce its interim FY18 forecast, ending December 2018.
The company says it now expects flat growth for the rest of the financial year.
"If current trading conditions continue, this, together with short term slippage of the commissioning of the Monarto mushroom facility upgrade in South Australia and the previously announced additional costs from investments such as African Blue, is expected to result in largely flat growth for the twelve month NPAT-S to the end of June 2019 compared to the prior year," says Costa Group.
Shares in Costa Group are up 1.85 per cent to $4.56 per share at 11.45am AEDT.
Photo Credit: Ella Olsson
Business News Australia
Author: Business News Australia