Select Harvests says its $80 million fully underwritten capital raise would be used to pay down debt, provide facility headroom, and fund capital investment to increase processing capability.
A recent operational review was the catalyst for Select Harvests’ (SHV) growth plans, looking at near-term organic growth opportunities to increase yield by up to 15 per cent from FY26.
The company said it could deliver a 10,000 MT capacity increase to 50,000 MT. It expects the FY24 crop to be roughly 29,500 MT. In April, SHV told the market the crop was going to be lower than forecast but still one of the largest crops ever produced and reducing debt was its priority.
Forecast FY24 snapshot
- underlying EBIT: $17-19m;
- underlying NPAT: $1.5-3m;
- final almond price: $7.70-$7.75 per kg; and
- net debt: $230-$245m
SHV said the forecast net debt was impacted by temporary cash collection delays, driven by freight issues and the record crop volume.
SHV CEO, David Surveyor, said a lower than forecast output from California is improving the price.
“While there is much more to do, the strategic initiatives and cost reductions resulting from the company’s initiatives are expected to deliver a significantly better financial result than FY23,” Surveyor said.
The capital raise will allocate $71.6 million to pay down debt and provide facility headroom, $5 million to capital investment, and $3.4 million on costs.
