Select Harvests Turns Around with $28.7M Profit as Almond Prices Surge

About Select Harvests Ltd

Select Harvests Limited (Select Harvests, ASX:SHV) is a leading Australian almond producer, managing orchards and processing facilities across Victoria, New South Wales, and South Australia. Listed on the ASX, the company supplies almonds globally to supermarkets, health food stores, and manufacturers, with its primary processing hub at Carina West in north-west Victoria.

Strong profits signal financial recovery

On May 29, 2025, Select Harvests announced a Net Profit After Tax (NPAT) of $28.7 million for the half-year ended March 31, 2025, a significant improvement from a $2.4 million loss in 1H FY2024. This turnaround, driven by higher almond prices and operational efficiencies, underscores the company’s strengthened financial position and ability to capitalise on global market trends.

High almond prices boost revenue

The company forecasts an almond price of $10.35 per kilogram for FY2025, a 34.6% increase from $7.69 per kilogram in FY2024. Strong demand from key markets like China and India, with 60% of the 2025 crop already contracted, ensures revenue stability. Additionally, 86% of the crop is hedged at an AUD/USD exchange rate of 0.648, mitigating currency fluctuations and securing predictable income streams.

Debt reduction enhances balance sheet

Net debt dropped to $168.2 million in 1H FY2025, a 29.3% reduction from $237.9 million in 1H FY2024, lowering the gearing ratio to 32.7% from 57.9%. Operating cash flow turned positive at $7.5 million, compared to a $23.2 million outflow in 1H FY2024. Announced on May 29, 2025, this deleveraging reflects disciplined cash management and robust sales, bolstering financial flexibility.

Operational efficiencies curb costs

Despite rising water prices and inflationary pressures, Select Harvests has stabilised costs through improved spray efficiency, reduced labour expenses, and streamlined processing operations. The company’s focus on operational discipline, reported on May 29, 2025, includes fewer processing line stops and lower packaging costs, maintaining stable expenses while enhancing product quality, as evidenced by positive customer feedback.

Strategic investments drive growth

The company is advancing its strategic pillars, including optimising crop yields through better fertiliser, bee density, and water use. Investments in drainage at Piangil and Mountview orchards protect tree health, supporting long-term productivity. The 2025 crop forecast of 24,000-26,500 metric tonnes, slightly below FY2024’s 29,527 metric tonnes, reflects industry-wide reductions but is offset by higher prices and contracted sales.

Processing capacity expansion progresses

Select Harvests is expanding its Carina West Processing Facility, with Phase 2 increasing capacity to 50,000 metric tonnes by 2025 for a $6 million investment. Reported on May 29, 2025, this project, partially ahead of schedule, enhances the company’s ability to process higher volumes efficiently, aligning with its goal to lead in processing scale and efficiency.

Market conditions favor sustained growth

Global demand for almonds, driven by plant-based food trends, remains strong, with tight supply chains supporting high prices. A forecasted 2.8 billion-pound Californian almond crop for 2025, noted on May 29, 2025, reinforces a favorable pricing environment. Select Harvests’ focus on operational discipline and strategic execution positions it to deliver sustainable profitability and shareholder value in this robust market.

Safety and compliance efforts continue

Select Harvests reported a Total Recordable Injury Frequency Rate (TRIFR) of 6.3, with reductions in lost time and medical treatment injuries, reflecting a commitment to workplace safety. Additionally, the company addressed a superannuation underpayment issue from 2020, recognising a $3.5 million provision in FY2024 accounts and making a voluntary disclosure to the Australian Taxation Office, ensuring compliance and transparency.