Chief executive Sean Hallahan said an oversupply of the ‘green gold’ waspushing prices down to $1 an avocado and denting the company’s 2021 profits.
“When you’re selling avocados at a dollar,I can tell you there’s not a farmer anywhere in Australia who’s making money out of that,and it’s not sustainable,” he said. “It’s really disappointing.”
He said the company was hoping the avocado category would recover as the economy reopens and Australians dine out. “There’ll be the food service market opening up,so there’ll be many more cafes with smashed avocado breakfasts going on,” Mr Hallahan told theSydney Morning HeraldandThe Age.
“Get out there and tell your friends to … order the odd smashed avocado breakfast. And then what’ll happen is we’ll have a bit more volume going into food service rather than retail,so our returns in retail should improve.”
Earnings before interest,taxes,depreciation and amortisation (EBITDA) rose by 10.6 per cent to $218.2 million in 2021 compared with 2020. Costa shares rose 8 per cent to $3.24 in Tuesday’s trade.
Total revenue remained steady at around $1.2 billion. The company will pay a fully franked dividend of 5 cents per share on April 7.