Comvita Achieves Profit Turnaround but Disclosure Worsens
- Bruce Roscoe
- 19 hours ago
- 6 min read
Comvita returned to profitability in the year to June through volume growth in mānuka shipments to the US and rigorous cost cutting. Chief executive officer Karl Gradon has deferred issuing earnings guidance and confirmed that Comvita will not pay a dividend for the current year.
By Bruce Roscoe
While proclaiming itself the “global leader in Mānuka honey,” Comvita no longer discloses the value of mānuka honey it sells in total or in any market.
Comvita held an online video presentation of its results for the June 2026 year on 28 August. Apiarist’s Advocate participated in the event. An investor presentation (26p), annual report (66p) and results notice (1p) were uploaded to the New Zealand Exchange (NZX) together with the results announcement (5p) on the same day.
(Unless stated otherwise, all data comparisons in this report are between Comvita’s June 2026 and June 2025 years or 30 June balance dates for those years.)
Comvita recorded sales of NZD213.0m, up 10.7%, gross profit of NZD114.8m, up 38.8%, operating profit of NZD14.0m (vs. loss of NZ29.0m), and net (after tax) profit of NZD7.7m (vs. loss of NZ29.0m). Buoyed by NZD40.5m in share sale proceeds in May, Comvita held net cash NZD0.5m (vs. net debt NZD62.4m).
China “Most Difficult Market”
North American revenues rocketed 66.5% to NZD57.8m (See Table 1 for a geographical sales breakdown). Reflecting the commodity nature of the US market for mānuka honey, Comvita’s headcount for full-time employees showed a total of 5 for North America compared with 187 for China, Japan, and other Asian countries. When all employee categories are included, the Asian total rises to 260 while the North American total is unchanged. Price, not people, sells commodities.
Amid intense competitive pressure, net contribution margin for North America collapsed to 6.6%, and has trended downward each year since the June 2022 year when it was four times higher at 26.5%.
The UMF™29+ mānuka honey product pictured in this article also illustrates the front page of the investor presentation. It is a face of “premiumisation” but untypical. In the US, Comvita’s fastest growing and second-largest market after Greater China (China, Hong Kong, Taiwan), most mānuka product is sold through the misnomer of “club retail”, which means off the floor of a warehouse-type seller that discounts to members (hence the term “club”).
No staff are recorded for EMEA (Europe, Middle East, Africa) where Comvita has opted to wholesale through distributors.
“Greater China remains our toughest market”, Gradon wrote in the annual report. Greater China sales of NZD73.6m have declined each year and shed NZD35.4m since the June 2023 peak year.
Benefit to Beekeepers
“Industry inventories have reduced and raw honey inventories have stabilised”, Comvita said in its presentation, which should be good news for beekeepers. Moreover, “Access to quality mānuka supply is becoming a competitive advantage”.
On the other side of the hive, while inventories may have stabilised, global markets were unstable and geopolitical conditions (read, the world is at war on multiple fronts) uncertain. Markets weren’t just changing in China, Gradon said. They were changing “everywhere”.
Comvita is likely to remain dependent on the supply of large volumes of mānuka honey from outside its in-house apiary network. Annual report data show the percentage of honey produced versus that purchased declined to 32% in the June 2026 year, down from 51% the year before. As Comvita’s apiary teams produced 500 tonnes from 19,000 hives (for average yield of 26.3 kilograms per hive), according to the report, implied demand from outside producers at 68% is 1,065.2 tonnes.
Demand growth is strongest for low mānuka grades. Comvita expects to meet demand for high grades from its own plantations which, established in 2017, use proprietary cultivars and now span “more than 6,400 hectares across 19 sites in the central North Island and Wairarapa regions”, the report said. Using proprietary cultivars, Comvita produced 190 tonnes of high-grade honey from these plantations in the year ended June 2026.
Although Comvita highlighted inventory reduction of 10.3% to NZD79.9m,within total inventory, finished goods increased 12.9% to NZD53.0m, pointing to channel saturation. As confirmation, the value of inventory written off and disposed, owing probably to best-before date expiry, leapt 171.2% to NZD2.8m. But the 43.5% decrease in raw materials inventory to NZD30.7m signals that Comvita likely will be active in local markets to the benefit of beekeepers.
Disclosure Worsens
Comvita’s worsening disclosure has now become a trend. The decision to inform the public less about its operations became conspicuous in the June 2025 year annual report, equally apparent in the financial statements for the half year to December 2025, and confirmed as routine in the June 2026 year annual report. None of those documents, for example, disclose the volume or value of mānuka honey that Comvita has sold.
In the breakdown of sales by product category in reporting for the June 2024 year, Comvita disclosed the percentage weighting in the sales mix of nine categories — UMF Mānuka Honey, Other Honey, Olive Extract, Propolis, the new category of “Winter Wellness”, Lozenges, MedihoneyTM, the new category of “Oral Care”, and “Other”. In the June 2025 and 2026 years, these were reduced to the three categories of “Functional Foods”, “Health Care”, and “Ingredients” (where “3%” is stated as “0.03%” in the June 2026 year annual report) (Tables 2 & 3).
Comvita may have reasoned that it was commercially disadvantaged relative to competitors by disclosing segment sales. Or it wished to hide non-performance. When the data were viewed as a series from the starting 2019 or even later year, it became clear that non-mānuka businesses had shown no- to low-growth, such as MedihoneyTM and olive leaf extract.
Starting Point
Without the segment disclosure, analysts are robbed of a starting point from which to estimate total sales, which is first to estimate the components of those sales (and from there to construct estimates for each level of profits). The CNN article, “Anthropic files to go public in a potentially trillion-dollar debut” (2 June 2026), notes: “Wall Street would get a much deeper look at the company’s business segments — including which products are generating the most revenue — through earnings reports if Anthropic were to go public”. That’s part of what being a publicly quoted company means.
Between the latest two full years, Comvita pared five pages from its interim financial statements for the half year to December 2025. Three sections were cut, including the section detailing investments in companies such as Uruguayan propolis supplier Apiter Laboratories.
Disciplinarian
Although the online presentation should have been as momentous as Lazarus’ recall from the dead, Gradon and chief financial officer Mandy Tomkins-Dancey both read robotically from platitudinous and repetitive scripts. Only some questions were answered and the call ended after only 43 minutes with Gradon saying, “As there are no more questions…”
Gradon in his first year in the Comvita cockpit appears to have interrogated each line item of cost in data that underlie the income statement and taken a scythe to many of them. He almost forcefully repeats the phrase “Disciplined capital allocation”, as though appalled at past investment decisions. “Cost management”, “execution”, “growth”, “inventory management”, and “procurement” are all to be “disciplined”, he vows. A clue to this determination was inlaid in Comvita’s April 2026 investor presentation for the life-saving capital raise, where “Deployed new forecasting tool” was stated under “Future-fit systems and capability”.
Singapore Sling
Singapore-headquartered beverage, dairy, and printing conglomerate Fraser & Neave (F&N; via F&N Ventures) became Comvita’s largest shareholder — and lifeline — with a 19.99% holding during the April capital raise.
Comvita hopes that the lifeline will extend to a life force. Gradon said that his leadership team would travel to Singapore this month, following an earlier visit to Singapore, Malaysia, and Thailand to explore opportunities that focused on distribution, supply chain, and innovation.
Aged-care sector investor PHC Investments (Waiheke Retirement Village) is second largest with 11.74%.
New Zealand Honey Co., a Mount Manganui-based, specialist online seller of mānuka honey and related products, has emerged as Comvita’s fifth-largest shareholder with a 4.38% holding. Such an appearance is rare, as mānuka honey companies tend not to invest in each other, perhaps because they know too little or perhaps because they know too much.
The last example of note in Comvita’s case is Capilano Honey (Australia), which held 5.4% in May 2008 but had divested before May 2010. At a time when Comvita shares were strong enough to double as currency, Capilano had accepted them for 91.7% of the payment for Medihoney Pty Ltd.
Comvita’s share price closed up 3c to 82c on the day of the results announcement and 2c above the 80c-per-share takeover offer made by Florenz a year earlier. The stock market’s “Well, OK” reaction reflected broad expectation that Comvita would achieve a profit turnaround. That expectation was already “in the price”.
Bruce Roscoe is a Japan-resident researcher and former foreign correspondent and securities analyst.
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