Select Harvests share price races 8% higher on crop update

The Select Harvests Limited (ASX:SHV) share price is up over 8% today following the release of the company's crop and market update.

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Select Harvests Limited (ASX: SHV) share price is up over 8% today following the release of the company's crop and market update. The harvest is progressing well and market demand remains strong. 

2020 crop and market update

According to the most recent Australian January Export shipment report released by the Australian Almond Board, month on month shipments are up 40% while year to date shipments are up 26%. Work demand from major almond importers and domestic customers remains strong. Chinese customers have commenced production post the extended Lunar New Year closure as a result of coronavirus.

The Californian Almond Board has released the domestic and export shipment report for the August 2019 to February 2020 period, confirming the 2019 crop will be approximately 2.55 billion pounds. Month on month shipments are up 7.9% and year to date shipments are up 5%. Both domestic and export shipments for February 2020 were record results. 

Select Harvests' 2020 crop is over 65% committed for sale at prices within the previously provided range of $8 – $8.50 per kilo. The company anticipates export shipments of the 2020 crop will commence within the next month. 

Select Harvests advised that the 2020 harvest is progressing well. Approximately 40% of orchards have been harvested with completion expected at the end of April. 10% of the crop has been processed with the yield and quality profile similar to last year. Although it is too early to provide an accurate forecast, Select Harvests is optimistic about crop size and quality. 

Select Harvests' business 

Select Harvests is one of Australia's largest almond companies, supplying almonds domestically and internationally. Customers include supermarkets, health food stores, food manufacturers, and retailers. 

The company is a fully integrated almond business consisting of orchards, processing, trading and consumer products. The company owns, leases, and also manages some orchards pursuant to joint ventures. It processes almonds by hulling and shelling, blanching, roasting, slicing, and creating almond meal. Select Harvests' brands include Lucky, Sunsol, and NuVitality, as well as retailer brands. 

In Select Harvests' most recent results announced in November last year, the company reported a 159.8% increase in full-year net profit after tax (NPAT) which rose to $53 million from $20.4 million. Earnings per share increased 139.2% to 55.5 cents per share, as almond volumes increased by 44.5% and almond prices increased by 6.8%. The cost of production per kilo of almonds decreased 14.7% with the impact of increased water costs kept to a minimum. 

Foolish takeaway 

Conditions are looking favourable for Select Harvests with a promising crop and strong market demand.  

Motley Fool contributor Kate O'Brien has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Share Market News

A happy young couple lie on a wooden deck using a skateboard for a pillow.
Share Gainers

These were the best-performing ASX 200 shares in March

These shares made their shareholders smile in March thanks to some very big gains.

Read more »

Businessman using a digital tablet with a graphical chart, symbolising the stock market.
Opinions

2 ASX shares I have been buying in 2024!

I’m a believer in the long-term outlook of these stocks.

Read more »

Stock market chart in green with a rising arrow symbolising a rising share price.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a massive day for the ASX 200, with a new all-time high recorded.

Read more »

A man sits thoughtfully on the couch with a laptop on his lap.
Technology Shares

This ASX tech stock rocketed 60% in March! Can it keep on delivering?

After soaring in March, the ASX tech stock is now up 169% since this time last year.

Read more »

Broker Notes

Brokers name 3 ASX shares to buy now

Here's why brokers are feeling bullish about these three shares this week.

Read more »

A young man clasps his hand to his head with his eyes closed and a pained expression on his face as he clasps a laptop computer in front of him, seemingly learning of bad news or a poor investment.
Share Fallers

Why Burgundy Diamond Mines, Clarity Pharmaceuticals, EML, and Zip are sinking today

These ASX shares are ending the week in the red. But why?

Read more »

A young women pumps her fists in excitement after seeing some good news on her laptop.
Share Gainers

Why Mesoblast, Newmont, Pilbara Minerals, and Platinum shares are jumping

These ASX shares are ending the week strongly. But why?

Read more »

a young boy dressed up in a business suit and tie has a cute grin and holds two fingers up.
Opinions

2 of my top ASX 200 shares to consider buying before April

I would happily exchange dollars for these two shares right now.

Read more »