The Select Harvests Limited (ASX: SHV) share price is finishing the week on a very positive note.
In morning trade the almond producer's shares are up 6% to $7.70. At one stage they were up as much as 12% to a 52-week high of $8.10.
Why is the Select Harvests share price surging higher?
Investors have been buying Select Harvests' shares this morning following the release of its full year results.
During the 12 months Select Harvests delivered EBITDA of $95.2 million and a net profit after tax of $53 million. This compares to EBITDA of $51.7 million and NPAT of $20.4 million in FY 2018.
Earnings per share came in at 55.5 cents per share. This allowed the board to declare a 20 cents per share fully franked final dividend. Which brings its full year dividend to 32 cents per share.
This strong performance was driven by a combination of solid crop growth and an increase in almond prices. During the period Select Harvests reported an almond crop of 22,690 MT, up 45% on 2018's crop. Almond prices came in at A$8.60 per kg in 2019, up 7% from A$8.05 per kg in 2018.
The company's managing director, Paul Thompson, said: "2019 delivered a strong operating result on the back of a very good crop and a continuing firming price. I am very pleased that our strategy of developing high yielding greenfield orchards, the ongoing focus on improved horticultural practices and targeted investments has led to a significantly improved financial outcome."
"Prior to the commencement of the new season we installed a further 94 frost fans and $6m in a new sorting line effectively doubling our sorting and packing capacity. This is in preparation for our increasing crop, plus providing the flexibility to react to meet short-term market peaks. The platform is set for Select Harvests to continue to achieve consistent production levels in future year," he added.
FY 2020.
The managing director appears optimistic on the future.
He concluded: "Based on Select Harvests planted almond orchards and anticipated yield, our almond production will incrementally increase over the next three years. We are confident in our ability to maintain yields above industry average, driving significant value upside from our existing orchard base. Our Balance Sheet remains strong, allowing us to withstand the inevitable volatility in our industry."
