Apata Annual Report 2007

apatapartners for growth

06 07 annual report

The year in review: Chairman and CEO’s report 2

Financial performance 4

Kiwifruit 6

Avocados 10

Apata strategic review; our challenge 12

Board of Directors 14

Executive team 16

– Record net profi t of $2.4m, up 15% on previous year

– Gross dividend of 23.1 cents/share resulting in a dividend yield of 12.85%

– Fully shared suppliers, will receive a gross return of 44.93 cents/share a yield of 25% on current share price

– Embarked on $5m capital expenditure program at the Turntable Road site, to support optimum harvest strategy

– Apata kiwifruit growers led the industry in growing for taste and responding to ZESPRI’s new quality initiatives

– Kiwifruit OGR per tray across all three products well ahead of industry averages

– Apata’s focus on treating growers’ fruit with care and diligence results in lowest onshore fruit loss

– Strong avocado results despite signifi cantly reduced volumes

Highlights Contents

Change IMAGES

Apata activities: crops packed during 2006/7 season

Avos

Gold

Green organic

Green

Apata trays packed : % of national export crop

Avos Gold Green Green organic

50%

40%

30%

20%

10%

0%

Corporate governance statement 18

2006/7 fi nancial statements 20

Security Act Exemption Notice 38

Company details 40

1

ap

ata

(ann

ual r

epo

rt 0

6/07

)

2

ap

ata

(ann

ual r

epo

rt 0

6/07

)

“A year of extremely satisfying results in profi tability, ROI, fruit quality and delivery – a substantial step

on our journey towards excellence.”

Dave Goodwin, Apata Chairman

The year in review

Apata Chairman Dave Goodwin and CEO Todd Muller

In January 2007 the Board instated new Chief Executive Offi cer Todd Muller, formerly ZESPRI General Manager Corporate and Grower Services. The tactical appointment has bought fresh skills and strategic vigour to the senior management team, and an added depth of understanding of the complexities and opportunities within the industry.

“It takes growers all year to develop a crop and maybe just a day to pick it. After that, grower returns depend on how it is treated through packing, cool storage, shipment and ultimately distribution to any one of 64 countries. I suspect a lot of people don’t understand the huge amount of trust involved. But I do and I’m making it my goal to ensure that growers are appropriately rewarded for that unique confi dence they have in us.” Todd Muller in The Orchardist, March 2007

On behalf of the Apata Limited Board of Directors, we are proud to present our Annual Report for the year ended 31 March 2007.

The company produced a best-ever profi tability result and a sound return on investment for shareholders.

Apata shareholders and growers enjoyed exceptional results during a year that saw the introduction of increasingly complex kiwifruit quality initiatives, industry fruit loss issues, intense labour shortages and a partial failure of the avocado crop.

When the kiwifruit industry renewed its focus on customer quality, Apata responded by handling fruit with utmost care, resulting in outstanding results for growers and an exemplary product delivered to ZESPRI and the market.

Apata avocado growers’ enthusiasm for the excellent returns delivered by the Apata/Primor partnership couldn’t be dampened by a Bay of Plenty crop failure or the Australian SCAB export debacle.

Our growers remained committed to producing ideal fruit; kiwifruit met all quality expectations and Apata fruit generally built upon its growing reputation for quality.

The Company grew in both size and operational scope, maintaining its founding commitment as a grower-built organisation servicing orchardists needs, while introducing new models for customer service and post-harvest results.

The excellent annual results support Apata’s fi ve-year commitment to quality and operational excellence, a dedication often at odds with the prevailing industry focus on delivery at pace, regardless of quality into end-markets.

Our business revolves around our growers, and our commitment that their fruit reaches domestic and world markets in optimum condition.

This powerful philosophy underpins our ongoing investments in cool chain capacity, capable people and increasingly effi cient technology. The innovative and hard-working Apata team have continued to refi ne the delivery of service and value to growers.

Alongside the success of a profi table year, these are all factors that ensure Apata is well positioned to capitalise on future opportunities.

3

ap

ata

(ann

ual r

epo

rt 0

6/07

)

The 8-lane sizer was extended and new grading tables and infeed systems put in place.

Share transactionsThe Company successfully completed the sale of all treasury stock shares held as at 31 March 2006 and originally acquired as Tranche One of the December 2005 non pro rata share buy back scheme. The Company then acquired Tranche Two (see Notes 11 and 14 to the fi nancial statements) and had successfully placed most of those shares prior to 31 March 2007. The 45,167 shares held as treasury stock at that date have since been sold.

During the past two years over 650,000 Apata Limited shares have been acquired by new shareholders or existing shareholders increasing their holdings. The strong demand is a refl ection of the tremendous confi dence shareholders have in the future of the Company.

Per-tray rebatesThe Board continued to reward all grower shareholders for trays supplied, paying rebates totalling $235,053 during the year (2006: $240,814). On the basis of the interim dividend and rebate paid and the fi nal dividend recommended, fully shared suppliers will receive a gross return of 44.93 (2006: 43.13) cents per share, a yield of 25.0% (2006: 25.4%) on the current share price of $1.80 (2006: $1.70).

The Board continues to encourage suppliers to maintain a one share to four trays supplied ratio, in order to maximise their rebates and returns and will continue to allocate shares in lieu of cash rebates to shareholders needing to increase their holdings to the required ratio.

Human resourcesDuring the year in review several Apata contract personnel were moved to permanent employment status, refl ecting the Company’s commitment to retain and reward key staff.

The group net profi t (before rebates) for the year in review was $2,484,392, an increase of 18% over the previous year. The tax paid surplus was $1,496,444, an increase of 20%. Increased profi tability came from handling more fruit, more effi ciently. Apata was also able to react quickly to mid-season market supply opportunities and was well rewarded with premium payouts.

Stuart Weston, CEO December 03 - January 07

“The Board brought Stuart Weston on board at the end of 2003. A young CEO, Stuart brought energy and passion to the role, coupled with a real strength in operations. Stuart was instrumental in implementing our drive for operational excellence, and headed the organisation through a period of substantial growth and change. We wish him well as CEO of Affco.”

Peter MaystonApata Board of Directors (Chairman 2002 to 2005)

Record profi tIn our most profi table year to date, your Directors are pleased to

report that the healthy orchard gate returns experienced by Apata

growers were echoed by strong fi nancial returns to shareholders.

Financial performance

Net profit before tax and rebates

2.5

2.0

1.5

1.0

0.5

02002/3 2003/4 2004/5 2005/6 2006/7

$ m

illio

ns

Rebates Net profit before tax

Apata profit distribution (2002/3 - 2006/7)

2.5

2.0

1.5

1.0

0.5

02002/3 2003/4 2004/5 2005/6 2006/7

$ m

illio

ns

Rebates Dividends Retentions Taxation

Each column represents total profit for each year. Final dividendsare included in the profit year from which they were allocated.

Apata investor returns

$2.00

$1.80

$1.60

$1.40

$1.20

$1.00

$0.80

$0.60

$0.40

$0.20

$0.00

$0.50

$0.45

$0.40

$0.35

$0.30

$0.25

$0.20

$0.15

$0.10

$0.05

$0.002002/3 2003/4 2004/5 2005/6 2006/7

Shar

e Pr

ice

Div

iden

ds

& E

arni

ngs

Share price at 31 MarchEarnings (profit before tax, after rebates) per share

Gross dividends per share

Healthy shareholder dividendsIn December 2006 the Company paid Apata shareholders an interim gross dividend of 11.94 cents per share (fully imputed 8 cents per share), in respect of the 2006/7 fi nancial year. Our strong fi nancial performance has allowed the Board to recommend a fi nal gross dividend of 12.99 cents per share (fully imputed 8.7 cents per share), payable September 2007. This will bring the total gross dividend relating to the 2006/7 fi nancial year to 24.93 cents per share, and when related to the current share price of $1.80, provides a dividend yield of 13.85%.

Retention for growth initiativesThe net profi t after tax and rebates of $1,496,444 will be distributed as follows:– Interim dividend $355,703– Provision for fi nal dividend $391,977– Retained in Company $748,764

This strong fi nancial result has provided the company with signifi cant extra retentions, even after paying one of the highest dividend yields in the industry.

Retained tax paid profi ts will be employed on the following initiatives:• Our internal share of the funding of the $5m capital

projects undertaken at Turntable Road in advance of the 2007 kiwifruit harvest;

• Further capital development of the Turntable Road and other sites during 2007/8;

• Scheduled major maintenance projects at the Turntable Road site during 2007/8, particularly the upgrading of our oldest coolstores;

• Building on the funds available to undertake strategic initiatives;

• Maintaining the strength of the balance sheet, including a reduction in existing term loans.

Investments in operational excellenceThe Company invested over $5 million into increasing our capacity to handle and care for your fruit, from harvest to packhouse and on through the entire cool chain. Completed by April 2007, Turntable Road projects included the new Coolstore 7, a sizeable extension to the Green packhouse and a new packaging materials shed.

As the Company matures into a year-round service-based operation, offering personnel the security of permanent employment is enabling Apata to attract excellent people in a tight labour market.

4

ap

ata

(ann

ual r

epo

rt 0

6/07

)

5

ap

ata

(ann

ual r

epo

rt 0

6/07

)

Embracing quality for customers: 06/07 seasonApata packed 4,989,760 and cooled 5,762,401 trays of Class 1 kiwifruit across four payment pools and processed 685,174 tray equivalents across 14 categories of non standard supply (NSS).

In 2006 Apata Limited supply to ZESPRI was supported by its key supplying partners; Bruntwood Farms, Claremont Packhouse, Te Puna Orchards, Western Orchards and 40 South. In 2007 the Earp family, owners of Te Puna Orchards, retired from post harvest operations and now supply Apata Limited. Apata acknowledges the substantial ongoing commitment the Earp family have made to this business and the wider industry.

6

ap

ata

(ann

ual r

epo

rt 0

6/07

)

“In an increasingly challenging global market, growers focus on delivering quality needs to be maintained. Apata growers should be

congratulated on a great performance last year and be encouraged to continue to respond to the ongoing market and performance signals”

Tony Nowell - Chief Executive, ZESPRI

Kiwifruit

More than twenty years of picking, packing and storage expertise proved invaluable during a season marred by massive fruit loss for other players.

Working closely with growers and picking fruit at optimum maturity, combined with strict temperature consistency in the cool stores, stringent inventory management and careful curing times, ensured Apata cared for fruit better than any other supplier.

Our pleasing 2006 harvest OGR outcomes were solid in all categories, for both per hectare and per tray returns, but we acknowledge there is continued work to be done to ensure our fi rst-rate quality and cool chain management outcomes fl ow through to superior OGR performance relative to the industry.

Apata knows that the primary driver of repeat purchases of kiwifruit is taste and Apata has continued to strengthen the union between those who grow the fruit and those who eat it. The high incidence of Y fruit means Apata growers are increasingly conscious of the need for high dry matter fruit, and are increasingly able to grow it.

2003/4 2004/5 2005/6 2006/7

Average of all other suppliers Apata Limited

Green organic kiwifruit : onshore fruit loss

0%

-2%

-4%

-6%

-8%

-10%

-12%

2003/4 2004/5 2005/6 2006/7


Green kiwifruit : onshore fruit loss

0%

-2%

-4%

-6%

-8%

-10%

-12%

Gold kiwifruit : onshore fruit loss

0%

-2%

-4%

-6%

-8%

-10%

-12%

2003/4 2004/5 2005/6 2006/7


The lower the fruit loss, the higher the return to growers throughexported fruit value and coolstore incentives.

Our fruit loss was again significantly less than that incurred elsewhere in the industry.

Apata supply group : Class 1 kiwifruit trays packed

9

8

7

6

5

4

3

2

1

02002/3 2003/4 2004/5 2005/6 2006/7

Mill

ions

Green Organic Gold

The Apata supply group comprises Apata (the Group) and fouraffiliate post-harvest service providers.

Y Fruit as % of total submit

80%

60%

40%

20%

0% 2005/6 2006/7 2007/8 2005/6 2006/7 2007/8

Apata compared to average of all other suppliers

Apata Limited Industry Green Industry Gold

7

ap

ata

(ann

ual r

epo

rt 0

6/07

)

ZESPRI’s introduction of commercial incentives to further improve the quality of New Zealand kiwifruit are applauded by Apata and our growers. ECPI wharf checks, increased monitoring and surveillance and the renewed focus on taste are commendable initiatives that keep the industry focused on quality.

Apata believes that ZESPRI’s quality focus should never be swayed by industry players who may have larger political infl uence and different performance priorities. Apata proved the achievability of these stringent quality benchmarks, leading the industry with dry matter profi les and low fruit loss statistics.

Our goals for greater industry clarity were assisted by NZKGI’s commendable moves to benefi t growers by bringing more transparency to post harvest performance. The Company is committed to publishing key delivery and performance metrics of the Industry Scorecard, regardless of results. Apata growers and shareholders have the right to compare results, and our performance expectations will be adjusted accordingly.

2007 to 2008 seasonVolume increases across all categoriesApata volumes picked and packed were up across all three categories, and we believe industry submit for the packing season just ended has the potential to reach the signifi cant milestone of 100 million trays for the fi rst time in industry history.

Our off-season investment in new cool store facilities allowed us to harvest the crop at optimum conditions and favourable weather assisted a smooth harvest operation.

Crop quality was more variable than last year, but Apata continued to deliver above industry averages for taste. With much crop still to be exported, we expect onshore post harvest infrastructures to again come under pressure with fruit deterioration challenges.

Picking started at the end of ISO week 12 with Kiwistart volumes from Hawkes Bay and fi nished 11 weeks later with the last of our organic crop through Pyes Pa.

ZESPRI has signaled strong market conditions, especially in Asia, with very healthy in-market prices across our key markets. It is clear that adverse foreign exchange rates in our key currencies will impact returns this year, but our growers are again well placed to weather this sector-wide fi nancial storm.

Apata is performing well across all supplier scorecard and quality measures YTD and we remain confi dent that this will continue through the remainder of the season.

Focus on the future

Gold % DIFOTIS

160%

120%

80%

40%

0%

Rank = 1 out of 10 based on in Spec

% In spec % Quantity

89%

135%

37% 40%

70%94% 89%

197%

% D

IFO

TIS

Apata Lowest Average Highest

Green % DIFOTIS

Rank = 1 out of 10 based on in spec



160%

120%

80%

40%

0%

97%

150%

80%91% 85%

105%97%

150%

% D

IFO

TIS

Green organic % DIFOTIS

Rank = 3 out of 7 based on in spec



160%

120%

80%

40%

0%

93%117%

66% 77%91%

112%96%

119%

% D

IFO

TIS

Year end Industry Scorecard performance(DIFOTIS: delivery in full, on time, in specifi cation)

Source: December Supplier Scorecard - Final, Zespri, 22 December

2006, covering YTD to ISO week 49

“In 2006 Apata took a lead in responding to the new ZESPRI supply chain framework for delivering quality and performance. They’ve shown they understand the imperative to meet the market, now and in the future.” Lain Jager, GM Global Supply.

The 2006 ZESPRI strategic plan outlined the collective efforts required by all industry participants to keep kiwifruit from slipping down the commodity slide. ZESPRI also signalled that growers and their post-harvest partners would need to develop and maintain a clear focus on delivering increased value to consumers by taking a progressively differentiated product to the market.

In-market differentiation starts with the fruit. Apata expects ZESPRI will demand more from its suppliers and growers, expecting us to consistently deliver the worlds’ best quality fruit, both in external appearance and in internal attributes.

We support ZESPRI’s drive for in-market differentiation, but expect in return that ZESPRI will support and reward those who demonstrate the ability to deliver results.

Past results prove our growers can deliver, and Apata is well-placed to lead the industry in support of ZESPRI’s drive for increased fruit value. We congratulate ZESPRI for its focus on taste, and for having the courage to lift Maximum Taste Payment (MTP) for Green to 40% of fruit value.

Apata believes grower and post-harvest suppliers should be given further incentives to deliver better taste to Japan and other priority markets as it is clearly such a critical driver for increased consumption.

Orchard gate return: per tray submitted

8

7

6

5

4

3

2

1

0

2004

/5

2005

/6

2006

/7

2004

/5

2005

/6

2006

/7

2004

/5

2005

/6

2006

/7

$ O

GR

per

tra

y

Green Green organic GoldApata

Industry

Orchard gate return: per hectare

50

40

30

20

10

0

2004

/5

2005

/6

2006

/7

2004

/5

2005

/6

2006

/7

2004

/5

2005

/6

2006

/7

$,00

0 O

GR

per

hec

tare

Green Green organic GoldApata

Industry

8

ap

ata

(ann

ual r

epo

rt 0

6/07

)

9

ap

ata

(ann

ual r

epo

rt 0

6/07

)

Apata avocado management focused their attentions on increasing grower services and pricing structures that rewarded quality and scale. Apata now handles many of New Zealand’s largest avocado producers, and their support allows the company to offer a comprehensive range of services to all. The Apata architecture was built to promote enduring relationships based on aligned values of quality and performance and the unique and long-standing Apata/Primor relationship has continued to fl ourish within this philosophy. Apata growers joined key Primor team members to visit the USA market in October 2006.

Primor has a deep market understanding and a strong performance ethos, making them invaluable partners for the year in review and beyond. Previous years saw the development of a personalised, on-orchard attitude to customer service, which continued to evolve into a step-by-step suite of value-added services for Apata avocado growers. Embraced by avocado growers, the service model will be adapted and introduced to kiwifruit customers in the near future.

Avocado focus on the future

Step-by-step service promotes growth: 2006 to 2007 seasonApata packed and processed 429,542 trays of avocados, split between domestic and export markets and representing 21% of the overall market, an increase of 2.5% over the previous fi nancial year.

The fi rst to publish their export returns, Apata and Primor had the season wrapped up, growers paid and the results published weeks before any other packers or exporters.

The Apata grower returns were again exceptional, and above those of key industry competitors. A smaller than anticipated biennial crop, considered a complete crop failure in the Bay of Plenty, stretched a scarce product over a large number of valuable customers.

“We’re pleased to report the total number of store rejections was only 150 trays, after we delivered 153,058 export trays in total.”

Ted Thomas - Primor Produce

Avocados

Change IMAGES Total NZ avocado crop & Apata market share2003/4 to 2006/7

6

5

4

3

2

1

0

30%

25%

20%

15%

10%

5%

0%2003/4 2004/5 2005/6 2006/7

Mill

ions

of

tray

s

Total avocado crop Apata market share

Apata avocado grower returns

20

18

16

14

12

10

8

6

4

2

02004/5 2005/6 2006/7

Average OGR/tray - export Average OGR/tray - domestic

$

Avocado market share 2006/7

Apata export

Apata local market

Rest of industry export

Rest of industry local market

Commitment to export was at risk, but careful crop and harvest management ensured Apata exported a higher percentage than the balance of the industry and satisfi ed key customers in growing markets. With Northland having the bulk of the fruit, the focus was on continuity of export supply.

Coming after a heavy cropping year, where quality dictated profi tability, the industry-wide focus on producing high quality fruit lessened. Apata have worked hard between seasons to re-focus our growers to minimise the longer-term impact of this hiccup in best-production practice.

Grade standards were altered to address the end-market perception of ‘scruffy’ New Zealand fruit; reject rates on many lines increased correspondingly and less than 55% of fruit handled was exported.

The November SCAB incident, where access to the Australian market was temporarily denied, galvanised an already well-organised young industry into a resolute and unifi ed grower group. The phyto-sanitary issue did not delay trans-Tasman shipping, but the direct cost to the industry is conservatively calculated at $500,000.

“We know that international fruit supply, especially to the USA, is based on trust and long-term relationships. The potential markets are colossal, but will remain unreachable for those who haven’t done the serious groundwork.”John Carroll - Chief Executive, Primor Produce

In a maturing and deregulated avocado industry, Apata believes a value-added service ethos and a proactive marketing partner are key strategies for future success.We expect to lead the industry with the delivery of an end-to-end service model that supports early grower commitment, superior planning, stronger relationships, better delivery and higher returns. Supporting all initiatives for industry collaboration and transparency, Apata will continue to work alongside their growers, the AIC and the AGA to improve industry outcomes in the areas of orchard technology, grower education, market development and fruit quality.

This season, now underway, Apata will handle a large percentage of the biggest crop in the history of the New Zealand avocado industry. The company relishes the opportunity to fl ex our logistic muscles, and employ the knowledge gained from years handling large kiwifruit crops. Apata intends to manage, harvest, transport and handle this years volume in a manner that exceeds our growers and marketers expectations.

Avocado plantings in the Mid and Far North continue unabated, including some unprecedented new orchards between 400-600 planted acres (up to 40,000 trees). Apata is poised to capture future opportunities offered by developments such as new varietals, increasing organic production and added-value processing technologies.

10

ap

ata

(ann

ual r

epo

rt 0

6/07

)

11

ap

ata

(ann

ual r

epo

rt 0

6/07

)

Apata has continued to fl ourish under the governance of a stable Board of knowledgeable and dedicated Directors and their intimate understanding of our industry is invaluable as the Company looks towards exciting developments to come.

The industry is changing quickly, with varying visions for post harvest and growers emerging. The Board anticipates the review process will ensure Apata and its growers are best placed to capture the value that exists for companies that can deliver for the customers of ZESPRI and Primor.

12

ap

ata

(ann

ual r

epo

rt 0

6/07

)

The Company is in the process of undertaking the most critical strategic review of its 23 year history.

Apata strategic review; our challenge

The review will further identify:• governance priorities and enabling management

structure • potential for improvements in operational

performance, effi ciency and cost control• investment in increased capacity, technology and

skilled personnel• priorities for service and information fl ow from the

Company to growers

The Board looks forward to presenting aspects of the review to shareholders at the upcoming Annual General Meeting in August 2007.

Rewards for performance and supportAs partners for growth, Apata view the achievements of the 2006/07 business year as an expected step on our journey, and a continued progression towards excellence.

We commend and thank our growers, shareholders, partners and our own people for building our collective knowledge, our performance on-orchard, and our post harvest results. Apata will work tirelessly for its growers, who are the industry’s top performers, to see they are rewarded for their hard work in responding to consumer demand.

Our industry is ever-changing and each year provides new opportunities to lift our collective performance in response to customer needs.

Thank you for your continued support.

Dave Goodwin Chairman

Todd Muller Chief Executive Offi cer

13

ap

ata

(ann

ual r

epo

rt 0

6/07

)

Apata Board of Directors

Retiring director

“Peter Rogers became a commercial appointee to the Apata Board in 2001. His commercial skills and business experience have enabled him to provide very valuable input into Board debate over the last six years.

Since balance date Peter has retired as a director of Apata and, on behalf of the board and shareholders, I wish to thank him for his contribution to the company.”

Dave Goodwin, Chairman

Fro

m le

ft t

o r

ight Peter Rogers

Peter Rogers is a qualifi ed Chartered Accountant and partner in Finn & Partners Chartered Accountants, Te Awamutu. A member of the Human Resources Institute of New Zealand and the Institute of Directors, Peter has a master of Business Administration degree from the Univeristy of Waikato.

Peter has considerable business experience in both private and public sectors, and holds a number of directorships and trusteeships in a variety of diverse enterprises.

Dave Goodwin, Chairman

Dave Goodwin has been involved with the kiwifruit industry since 1979, both as a grower and packhouse operator. Dave has had extensive experience in the post harvest sector and industry governance having been a past managing director of Centrepac Packhouse & Coolstore Limited, former CEO of Apata Limited, past president of Tauranga Fruitgrowers’ Association Incorporated and foundation board member of Horticulture New Zealand. Dave has served on many kiwifruit industry bodies including NZKGI and IAC.

Max McGreevy

Growing kiwifruit in Athenree since 1981, Max McGreevy started Claremont Packhouse as a contract packing shed in 1984. An Apata Limited shareholder since 1993, Max was appointed as a Director in 1994.

Also a Director of Apata Suppliers Entity Limited, Max is integrally involved in orchard ownership and kiwifruit packing, with shareholding in Tetley Coolstores Limited.

Paul O’Brien

Paul O’Brien has been growing kiwifruit since 1978 when his family developed an orchard at Aongatete. He established his own orchard contracting business in 1987, and grows avocados and green and gold kiwifruit on his own orchard. An executive member of Katikati Fruitgrowers’ Association Incorporated, Paul was elected to the steering committee to form Apata Suppliers Entity Limited in 1996, became a director of the entity in 1998 and chairman in 2001. An Apata Limited director since 2003, Paul and his wife Paula have been shareholders since 1991.

Peter Mayston

An Apata shareholder and director since incorporation, Peter Mayston has grown kiwifruit, avocados and citrus for more than 30 years and operated a kiwifruit packhouse for most of that time. He is a former director of Taura Natural Ingredients Limited and a delegate of the New Zealand Orchard and Vineyard Employers Association.

Mike Muller

A founding Apata director, Mike Muller is a past executive of the Tauranga Fruitgrowers’ Association and has been a kiwifruit grower and integral industry participant for more than 30 years. Mike heads the successful Muller & Associates kiwifruit consultancy business.

14

ap

ata

(ann

ual r

epo

rt 0

6/07

)

15

ap

ata

(ann

ual r

epo

rt 0

6/07

)

Marilyn HaywoodOperations Manager

Marilyn began her career as a kiwifruit packhouse and coolstore manager over 25 years ago, and has worked within the industry during its various stages, during the NZ Kiwifruit Authority, the Kiwifruit Marketing Board and now the ZESPRI era. In 1996 Marilyn joined Apata, bringing her extensive knowledge and expertise in dealing with fruit quality and the off-shore experience gained while working for NZKA. Highly regarded in the kiwifruit industry, Marilyn oversees operations across all three Apata sites.

Tim TorrBusiness Development Manager

With a horticultural science degree and a passion for the science of the kiwifruit industry, Tim joined Apata in 2002, initially responsible for the grower services team. Now Tim focuses on the transfer of technical information to Apata growers and the development and implementation of innovative programs that enhance growers’ on-orchard success.

Todd Muller Chief Executive Offi cer

Todd joined Apata in January 2007 after eight years in senior management roles at ZESPRI. With a Masters Degree from Waikato University, Todd has worked with the National Party (and then Prime Minister Jim Bolger) and Fonterra, New Zealand’s largest company. Todd’s vast industry experience, strong existing relationships and deep understanding of growers’ needs are proving invaluable in his new role.

Phil ReedClient Services Delivery Manager

Phil has been involved in the kiwifruit industry for 16 years, having worked his way through the cadetship system and then into managing orchards. An avocado grower for the past 11 years, Phil has also managed his own substantial harvesting operation. Phil joined Apata as a grower services representative in 2003, and quickly progressed to managing the company’s avocado division. From 2006 Phil has managed the overall grower services team, responsible for delivering services to both kiwifruit and avocado growing customers.

Colin ReillyChief Financial Offi cer

Colin joined Apata in 2004 on his return from Europe. As Chief Financial Offi cer, he is responsible for the overall fi nance and information systems functions. Before joining Apata, Colin held senior management positions in Tauranga and abroad, including roles at KPMG, Design Mobel, Reuters and BAA McArthurglen. Colin also has experience in manufacturing and services. Colin is a Chartered Accountant and has a Bachelor of Management Studies from the University of Waikato.

Dinah RutherfordExecutive Administrator

Dinah started working in the kiwifruit industry when she moved to Tauranga in 1996. With an extensive career in education management, Dinah’s role at Apata includes responsibility for the administration and accounting for Apata Suppliers Entity and the management of the grower pools. Dinah also provides secretarial and administrative support to the Board, Chief Executive Offi cer and company executive.

Executive team

Fro

m le

ft t

o r

ight Peter Carter

Commercial Manager

A chartered accountant, Peter Carter worked as a company accountant for Turners & Growers (Auckland) for 15 years. Peter left his role as the fi nance manager of a South Auckland packhouse last year and joined Apata as their commercial manager. Peter is working on fi nancial modelling and contract preparation for Apata, as well as managing kiwifruit supply during the season just past.

16

ap

ata

(ann

ual r

epo

rt 0

6/07

)

17

ap

ata

(ann

ual r

epo

rt 0

6/07

)

The Board of Directors is responsible to shareholders for the performance of the Group. Responsibility for day to day operations and administration is delegated by the Board to the Chief Executive Offi cer.

Board compositionThe Company’s constitution permits a minimum number of two directors, and a maximum of six.

At each general meeting, one third of the ordinary directors shall retire from offi ce. A retiring ordinary director shall be eligible for re-election.

The Board may by resolution from time to time appoint and remove one additional person as a director (“the additional director”). The additional director will hold offi ce for such term as is determined by the Board at the time of appointment, up to a maximum term of 3 years.

The Chairman is elected annually by the Board at the fi rst directors’ meeting following the annual meeting.

A director is not required to hold shares.

Audit & risk committeeThe audit and risk committee is made up of three directors. The committee members during the year under review were Peter Rogers (Chairman), David Goodwin and Max McGreevy. Members of the executive and the external auditors are invited to committee meetings as deemed necessary.

The primary role of the committee is to assist the Board to meet its responsibilities in respect of the Group’s accounting practices, reporting requirements and internal controls.

These responsibilities include:1. Monitoring of corporate risk assessment and the

internal controls instituted; 2. Review of the annual fi nancial statements, audit

fi ndings and processes;3. Review of accounting processes and interim fi nancial

information, including budgets;4. Review of the frequency and signifi cance of all

transactions between the company and related parties and assessment of their propriety;

5. Oversight of compliance with statutory responsibilities relating to fi nancial, shareholder and other requirements.

The Board may establish other committees on an ad hoc basis as required from time to time.

Delegation of authorityThe constitution restricts certain authorities to the Board, but provides for authority on other matters to be delegated. The Board has delegated certain authority to the audit and risk committee and to senior management, particularly to facilitate the day-to-day management of the business, including the signing of contracts and other documents.

Confl icts of interestWhere any director has a confl ict of interest or is otherwise interested in any transaction, that director is required to disclose his confl ict of interest, and thereafter neither participate in the discussion nor vote in relation to the relevant matter. The Group maintains a register of disclosed interests.

The role of shareholdersThe Board aims to ensure that shareholders are informed of all major developments affecting the Group’s state of affairs. Information is communicated to shareholders in the annual report, newsletters and other correspondence. The Board encourages full participation of shareholders at the annual meeting to ensure understanding of and support for the Group’s strategies and goals.

Corporate governance statementResponsibilities and functions of the board

Apata Limited and Group

2006/7 fi nancial statements

18

ap

ata

(ann

ual r

epo

rt 0

6/07

)

19

ap

ata

(ann

ual r

epo

rt 0

6/07

)

The directors are pleased to present the fi nancial statements of Apata Limited and Group for the year ended 31 March 2007.

For and on behalf of the Board of Directors:

D J Goodwin Chairman 12 July 2007

M R McGreevyDirector12 July 2007

Statement of fi nancial performanceYear ended 31 March 2007

2007 2007 2006 2006 Notes Group Company Group Company

Income Gross operating revenue 31,923,788 31,116,913 29,105,417 27,871,616

Net contribution from operations 10,182,055 10,153,178 8,722,004 8,685,933Interest received 210,131 171,831 121,106 100,017Dividends received 21,432 21,432 18,181 68,181Total 10,413,618 10,346,441 8,861,291 8,854,131

Less expenses 3 8,164,279 8,148,866 6,989,923 6,967,538Net surplus before taxation 2,249,339 2,197,575 1,871,368 1,886,593Tax expense 4a 752,895 735,813 622,387 610,912Net surplus after taxation 1,496,444 1,461,762 1,248,981 1,275,681

Statement of movements in equityYear ended 31 March 2007


Net surplus for the year 1,496,444 1,461,762 1,248,981 1,275,681

Total recognised revenue and expenses 1,496,444 1,461,762 1,248,981 1,275,681Less dividends paid to shareholders (693,615) (693,615) (360,189) (360,189)Less treasury stock purchased 11 (377,221) (377,221) (375,802) (375,802)Add treasury stock sold 11 444,059 444,059 233,583 233,583Add new shares issued 5,309 5,309 - -Movements in equity for the year 874,976 840,294 746,573 773,273Total equity at beginning of year 7,341,558 7,252,397 6,594,985 6,479,124Total equity at end of year 8,216,534 8,092,691 7,341,558 7,252,397

Statement of fi nancial performance 21

Statement of movements in equity 21

Statement of fi nancial position 22

Statement of cash fl ows 23

Notes to the fi nancial statements 24

Auditors’ report 35

Statutory information 36

Financial statements index

Apata Limited and Group : 2006/7 fi nancial statements

M R McGree

20

ap

ata

(ann

ual r

epo

rt 0

6/07

)

21

ap

ata

(ann

ual r

epo

rt 0

6/07

)

Statement of fi nancial positionAs at 31 March 2007


Current assets Bank 5 1,029,303 427,707 260,126 175,924Short term deposits 6,414 6,414 599,235 599,235Goods and Services Tax receivable 421,011 378,844 155,568 116,171Accounts receivable 689,109 1,093,085 1,861,800 1,850,651Inventories 6 1,836,708 1,836,708 1,813,837 1,813,837Taxation receivable 4b 65,721 65,450 - - 4,048,266 3,808,208 4,690,566 4,555,818

Investments 7 63,078 63,178 61,641 61,741Fixed assets 8 11,890,810 11,890,810 9,683,205 9,683,205Total assets 16,002,154 15,762,196 14,435,412 14,300,764

Current liabilities Accounts payable 9 4,514,498 4,398,383 3,143,201 3,097,505Taxation payable 4b - - 37,873 38,082 4,514,498 4,398,383 3,181,074 3,135,587

Term liabilities Term loans 10 3,200,000 3,200,000 3,800,000 3,800,000Other liabilities Deferred taxation 4c 71,122 71,122 112,780 112,780Total liabilities 7,785,620 7,669,505 7,093,854 7,048,367

Shareholders funds equity and reserves Paid in share capital 11 5,390,216 5,390,216 5,318,069 5,318,069Capital reserve 140,204 140,204 140,204 140,204Retained earnings 2,686,114 2,562,271 1,883,285 1,794,124Total equity 8,216,534 8,092,691 7,341,558 7,252,397Total liabilities and equity 16,002,154 15,762,196 14,435,412 14,300,764

Statement of cash fl owsYear ended 31 March 2007


Cash fl ows from operating activities Cash was provided by / (applied to) Receipts from customers 32,814,831 31,665,130 28,921,444 27,722,862Interest received 210,131 171,831 121,106 100,017Dividends received 20,122 20,122 17,582 67,582Income tax paid (898,147) (881,003) (647,151) (639,280)Payments to suppliers and employees (28,415,502) (27,762,039) (25,409,946) (24,313,957)Interest paid (320,965) (320,965) (344,161) (344,161)Net cash fl ows from operating activities 12 3,410,470 2,893,076 2,658,874 2,593,063

Cash fl ows from investing activities Cash was provided by / (applied to) Proceeds from sale of fi xed assets 67,666 67,666 - -Acquisition of fi xed assets (2,080,312) (2,080,312) (3,252,822) (3,252,822)Acquisition of investments - - - (100)Net cash used in investing activities (2,012,646) (2,012,646) (3,252,822) (3,252,922)

Cash fl ows from fi nancing activities Cash was provided by / (applied to) Treasury stock purchased (377,221) (377,221) (375,802) (375,802)Proceeds from sale of treasury stock 444,059 444,059 233,583 233,583Dividends paid (693,615) (693,615) (360,189) (360,189)Issue of shares 5,309 5,309 - -Proceeds from borrowings - - 2,200,000 2,200,000Repayment of borrowings (600,000) (600,000) (1,000,000) (1,000,000)Net cash (used in) / from fi nancing activities (1,221,468) (1,221,468) 697,592 697,592

Net increase / (decrease) in cash held 176,356 (341,038) 103,644 37,733Add cash at beginning of year 859,361 775,159 755,717 737,426Total cash balance at end of year 1,035,717 434,121 859,361 775,159

This is represented by: Bank 1,029,303 427,707 260,126 175,924Short term deposits 6,414 6,414 599,235 599,235 1,035,717 434,121 859,361 775,159

22

ap

ata

(ann

ual r

epo

rt 0

6/07

)

23

ap

ata

(ann

ual r

epo

rt 0

6/07

)

Notes to the fi nancial statements (year ended 31 March 2007)

Note 1 : Statement of signifi cant accounting policies

Basis of preparationThe fi nancial statements presented are those of Apata Limited (“the Company”) and its wholly owned subsidiary (collectively “the Group”).

Apata Limited is registered under the Companies Act 1993, and is an issuer for the purposes of the Financial Reporting Act 1993.

The fi nancial statements comply with the Financial Reporting Act 1993, and comprise statements of the following: fi nancial performance, movements in equity, fi nancial position, cash fl ows, signifi cant accounting policies and notes to these fi nancial statements.

The fi nancial statements are prepared on the basis of historical cost except that certain assets were revalued in 1991 under the transitional provisions of FRS-3. No further revaluations have been made since this date.

The fi nancial statements have been prepared in accordance with generally accepted accounting practice in New Zealand.

Where no fi nancial reporting standard or statement of standard accounting practice exists in New Zealand in relation to a particular issue, the accounting policies and disclosures adopted have been determined having regard to authoritative support.

The fi nancial statements are in New Zealand dollars.

Basis of consolidationThe Group fi nancial statements incorporate the fi nancial statements of the Company and its wholly owned subsidiary, Apata Suppliers Limited, which has been consolidated using the purchase method. All inter-company transactions, balances and unrealised profi ts are eliminated on consolidation.

Specifi c accounting policiesThe following specifi c accounting policies, which materially affect the measurement of fi nancial performance and fi nancial position, have been adopted.

Revenue recognitionRevenue is recognised in the statement of fi nancial performance when a transaction gives rise to an increase in the value of net assets, and that increase can be measured with reliability.

Accounts receivableAccounts receivable have been stated at their estimated net realisable value after due allowance for bad and doubtful debts.

ConsolidationApata Suppliers Limited has the ultimate contract to supply Zespri with kiwifruit. Apata Suppliers Limited also arranges the logistics services and receives revenue for this service performed on behalf of growers (via Southlink Limited).

On the basis that Apata Suppliers Limited is acting only as agent, and not owner of the fruit, the receipts and payments are not refl ected as revenue and expenses, and instead treated as ‘pass-through’ money, having no impact on fi nancial performance. Accordingly those Zespri receipts in respect of payments to growers are excluded from the statement of fi nancial performance and the statement of cash fl ows.

InvestmentsInvestments are valued at cost. Interest income is recognised in the statement of fi nancial performance as it accrues. Dividend income is recognised in the statement of fi nancial performance on the date the dividend is declared. InventoriesInventories have been valued at the lower of cost or net realisable value on a fi rst-in fi rst-out basis after due allowance for damaged and obsolete stock. Some inventories are subject to retention of title clauses.

Orchard work in progress comprises direct expenses for leased orchards, including growing costs and rentals, which are carried forward in the statement of fi nancial position as an asset to be matched against the income to which they relate (i.e. against the crop proceeds).

Goods and Services TaxAll amounts are shown exclusive of Goods and Services Tax (GST), except for receivables and payables that are stated inclusive of GST.


Expenses include: Shareholder rebates 235,053 235,053 240,814 240,814Audit fees 24,007 24,007 31,092 30,092Director’s fees 109,250 109,250 67,000 67,000Depreciation 8 1,326,458 1,326,458 1,559,200 1,559,200(Gain) / loss on sale of fi xed assets 8 (67,531) (67,531) 14,410 14,410Interest expense 309,752 309,752 357,117 357,073Operating lease expenses 915,039 915,039 775,030 775,030Bad debts (recovered) / expense (4,253) (4,253) 7,825 7,825

TaxationIncome tax expense is recognised on the operating surplus before taxation adjusted for permanent differences between taxable and accounting income. The tax effect of all timing differences, which arise from items being brought into account in different periods for income tax and accounting purposes, are recognised in the statement of fi nancial position as a future tax benefi t or a provision for deferred tax. The future tax benefi t or provision for deferred tax is stated at the income tax rates prevailing at balance date. Future tax benefi ts are not recognised unless realisation of the asset is virtually certain.

Provision for dividendsDividends are recognised in the period that they are authorised and approved.

Fixed assets and depreciationThe Group has fi ve classes of fi xed assets; all fi xed assets are valued at cost less depreciation except those assets which were revalued in 1991 – refer notes 1 and 8. Where a fi xed asset is disposed of, the gain or loss recognised in the statement of fi nancial performance is calculated as the difference between net sales price and carrying value.

Depreciation is charged from the time the assets become operational. For taxation purposes, the Group claims the maximum depreciation allowed by the Income Tax Act 2004. For accounting purposes, depreciation is calculated using straight-line depreciation rates which write off the cost of the asset, less any residual value, over its expected useful economic life:– Land Not depreciated– Buildings 10-50 years– Plant and equipment 5-15 years– Vehicles 5-15 years– Offi ce equipment and furniture 3-20 years

Changes in accounting policiesAll policies have been applied on a basis consistent with those used in previous years.

Changes in comparativesCertain comparatives have been aligned with current year presentation.

The Group operates predominantly in one industry, being the packing and coolstoring of kiwifruit and avocados. All operations are carried out within New Zealand.

Note 3 : Expenses

Note 2 : Segmental information

24

ap

ata

(ann

ual r

epo

rt 0

6/07

)

25

ap

ata

(ann

ual r

epo

rt 0

6/07

)

2007 2007 2006 2006 Group Company Group Company

4a) Income tax expense Net surplus before taxation 2,249,339 2,197,575 1,871,368 1,886,593 Adjusted for permanent differences: Non deductible expenses 53,593 53,593 32,834 32,834 Imputation credits received 10,556 10,556 8,955 33,582 Taxable income 2,313,488 2,261,724 1,913,157 1,953,009

Tax expense at 33% 763,451 746,369 631,342 644,494 Less imputation credits (10,556) (10,556) (8,955) (33,582) Total income tax expense 752,895 735,813 622,387 610,912

Total income tax expense is made up of: Current taxation 794,553 777,471 659,062 647,587 Deferred taxation (41,658) (41,658) (36,675) (36,675) 752,895 735,813 622,387 610,912

4b) Taxation (receivable) / payable Opening balance 37,873 38,082 25,962 29,774 Current taxation charge for the year 794,553 777,471 659,062 647,587 Taxation paid during the year (852,193) (847,613) (620,737) (619,779) Resident withholding tax paid (45,954) (33,390) (26,414) (19,500) Closing balance (65,721) (65,450) 37,873 38,082

4c) Deferred taxation liability Opening balance 112,780 112,780 149,455 149,455 Current year movement (41,658) (41,658) (36,675) (36,675) Closing balance 71,122 71,122 112,780 112,780

4d) Imputation credit account Opening balance 1,374,926 1,330,379 896,227 834,925 Add imputation credits attached to

dividends received 10,556 10,556 8,955 33,582 Add taxation and RWT paid during

the year 898,147 881,003 647,151 639,279 Less imputation credits attached to

dividends paid (341,631) (341,631) (177,407) (177,407) Closing balance 1,941,998 1,880,307 1,374,926 1,330,379

Note 4 : Taxation

The Company has a bank overdraft facility with ANZ National Bank Limited which is secured by a General Security Agreement over all present and after acquired property of the Group and also by a fi rst mortgage over the Group’s land and buildings. The overdraft facility as at 31 March 2007 was $3,000,000 (2006: $2,000,000); of this $3,000,000 was not utilised at 31 March 2007.

The Group leases kiwifruit orchards. Lease payments are based upon orchard rental, production levels, productivity and market profi t. Lease expenses are contingent upon the number of trays packed for each leased orchard and are not quantifi able until fi nal harvest returns are confi rmed. The Group has responsibility for the day to day management and control of the orchard

businesses and of all operations on the orchards. The Group is entitled to receive all payments from the sale of class l kiwifruit from these leased orchards.

Packhouse operations in respect of the 2007 harvest commenced in the days immediately prior to 31 March 2007. Costs incurred have been aggregated to work in progress.

Investments are stated at cost. The investment in Apata Suppliers Limited is eliminated upon consolidation.

Investments consist of shares in the following companies:


Packaging 1,250,011 1,250,011 1,379,738 1,379,738Orchard work in progress 258,540 258,540 234,999 234,999Work in progress – current harvest 328,157 328,157 199,100 199,100 1,836,708 1,836,708 1,813,837 1,813,837


MG Marketing Limited 36,424 36,424 35,100 35,100Ballance Agri-Nutrients Limited 3,321 3,321 3,208 3,208SouthLink Limited 23,333 23,333 23,333 23,333Apata Suppliers Limited - 100 - 100 63,078 63,178 61,641 61,741

Note 6 : Inventories

Note 5 : Bank overdraft

Note 7 : Investments

Not

es t

o th

e fi n

anci

al s

tate

men

ts (

year

end

ed 3

1 Mar

ch 2

007)

27

ap

ata

(ann

ual r

epo

rt 0

6/07

)

26

ap

ata

(ann

ual r

epo

rt 0

6/07

)

Market valuationCertain land and buildings with a book value at 31 March 2007 of $4,145,012 (2006: $3,903,445) at the Apata site were independently valued on 9 November 2006 by Mr J D Bennie of 3D Consultancy at $9,500,000. Mr Bennie is a member of the New Zealand Institute of Valuers.

Plant, equipment and motor vehicles of the Group were valued on 1 October 2005 by Mr G Scoullar of Asset Valuations Limited, Tauranga, at $7,403,620. The book value of that same group of assets, excluding additions subsequent to the valuation, as at 31 March 2007 was

$4,258,724 (2006: $5,405,747). Mr Scoullar is a member of the Institute of Plant and Machinery Valuers. The valuations placed on assets were based on their market value for a going concern.

These revaluations were not incorporated in the fi nancial statements. Certain plant and equipment assets were revalued in 1991, and then depreciated over their expected useful lives. No further revaluations have been made since this date.

Capital works in progressCapital works in progress represents costs incurred to balance date on capital programmes due for completion in future fi nancial periods.

Costs will be recognised as fi xed assets, and depreciation will commence immediately following commissioning of works.


Coolstore construction 1,384,367 1,384,367 - -Site development works 467,270 467,270 - -Total capital works in progress 1,851,637 1,851,637 - -

Note 8 : Fixed assets

Repayment terms of term liabilitiesNon-current borrowings are repayable as follows:

ANZ National Bank Limited loans are secured by General Security Agreement over all present and after acquired property of the Group and by a fi rst mortgage over Group land and buildings.

Loan 016 entered into on 27 May 2004 is a fl oating rate interest only mortgage, with interest being based on the Bank’s 90 day bill rate. The loan term expires on 20 May 2009. The company repaid $600,000 in November 2006.

Loan 017 for $2,200,000 entered into on 31 May 2005 is a fl oating rate interest only mortgage, with interest being based on the Bank’s 90 day bill rate. The loan expires 3 June 2010.

A new loan entered into after balance date is reported in Note 19.

Accounts payable consists of the following:

Term loans consist of the following:


Trade 2,653,720 2,537,605 2,823,843 2,778,147Employee entitlements 279,828 279,828 181,082 181,082Fixed assets 1,560,966 1,560,966 107,079 107,079Interest accrual 19,984 19,984 31,197 31,197 4,514,498 4,398,383 3,143,201 3,097,505


Current portion - - - -Later than one, not later than two years - - - -Later than two, not later than fi ve years 3,200,000 3,200,000 3,800,000 3,800,000 3,200,000 3,200,000 3,800,000 3,800,000

Note 9 : Accounts payable

Note 10 : Term loans

Effective Final interest rate repayment 2007 2007 2006 2006 31.3.2007 date Group Company Group Company

ANZ National Bank Limited loans # 016 8.74% 20/05/09 1,000,000 1,000,000 1,600,000 1,600,000# 017 8.83% 3/06/10 2,200,000 2,200,000 2,200,000 2,200,000 3,200,000 3,200,000 3,800,000 3,800,000

Cost / Current Gains / Accumulated Closing revaluation depreciation (losses) on depreciation book value charge disposal

Company and Group at 31 March 2007 Land 1,470,326 - - - 1,470,326Buildings 3,875,811 107,692 - 647,207 3,228,604Plant and equipment 14,435,396 1,048,562 65,000 9,648,635 4,786,761Vehicles 986,269 43,949 2,667 761,297 224,972Offi ce equipment and furniture 806,835 126,255 (136) 478,325 328,510Capital works in progress 1,851,637 - - - 1,851,637Total 23,426,274 1,326,458 67,531 11,535,464 11,890,810

Company and Group at 31 March 2006 Land 1,462,514 - - - 1,462,514Buildings 3,426,030 98,517 (9,344) 539,515 2,886,515Plant and equipment 14,281,052 1,288,838 (1,553) 9,471,243 4,809,809Vehicles 1,028,144 55,852 - 830,795 197,349Offi ce equipment and furniture 724,928 115,993 (3,513) 397,910 327,018Total 20,922,668 1,559,200 (14,410) 11,239,463 9,683,205

Not

es t

o th

e fi n

anci

al s

tate

men

ts (

year

end

ed 3

1 Mar

ch 2

007)

28

ap

ata

(ann

ual r

epo

rt 0

6/07

)

29

ap

ata

(ann

ual r

epo

rt 0

6/07

)


Net surplus after taxation 1,496,444 1,461,762 1,248,981 1,275,681

Add / (less) non cash items: Depreciation 1,326,458 1,326,458 1,559,200 1,559,200(Gain) / loss on disposal of fi xed assets (67,531) (67,531) 14,410 14,410Movement in deferred tax (41,658) (41,658) (36,675) (36,675)Investment activities (capitalised dividends) (1,437) (1,437) (1,229) (1,229)

Add / (less) movement in working capital: Inventories (22,871) (22,871) (189,280) (189,280)Accounts receivable 1,172,691 757,566 154,862 (116,022)Goods and Services Tax (265,443) (262,673) 101,770 108,760Interest payable (11,213) (11,213) 12,913 12,913Trade creditors and other payables (71,376) (141,795) (217,989) (43,003)Taxation payable (103,594) (103,532) 11,911 8,308Net cash fl ows from operating activities 3,410,470 2,893,076 2,658,874 2,593,063

The 83,659 shares held as treasury stock as at 31 March 2006 were all onsold during the period to 31 August 2006. The Company then purchased a further 221,894 shares from shareholders as treasury stock, and onsold 176,727 of those shares in the period to 31 March 2007. The cost of the remaining 45,167 shares held as treasury stock at 31 March 2007 was $ 76,784 (2006: $142,219).

The treasury stock purchases have been made in accordance with the non pro rata share buy back agreement entered into during 2005, to be completed in three tranches. The Company is committed to purchasing the third and fi nal tranche on or before 19 December 2007.

2007 2007 2006 2006 Number Value ($) Number Value ($)

Issued and paid up capital as at 1 April 4,418,702 5,318,069 4,502,361 5,460,288Shares purchased as treasury stock (221,894) (377,221) (221,060) (375,802)Shares sold from treasury stock 260,386 444,059 137,401 233,583New shares issued 3,123 5,309 - -Closing balance 4,460,317 5,390,216 4,418,702 5,318,069

Note 11 : Share capital

The following is a reconciliation between the surplus after taxation shown in the statement of fi nancial performance and the net cash fl ow from operating activities.

Note 12 : Reconciliation of net surplus after tax with net cash fl ows from operating activities


Payments for rebates, kiwistart and non standard supply fruit value David Goodwin 120,169 120,169 61,654 61,654Max McGreevy 76,026 76,026 64,027 64,027Peter Mayston 90,068 90,068 16,455 16,455Michael Muller 6,815 6,815 1,364 1,364Paul O’Brien 55,942 55,942 10,446 10,446

Payments for dividends (net) David Goodwin 40,022 40,022 20,657 20,657Max McGreevy 78,961 78,961 40,754 40,754Peter Mayston 85,942 85,942 44,357 44,357Michael Muller 63,807 63,807 36,976 36,976Paul O’Brien 4,913 4,913 1,198 1,198

Payments for executive services/consultancy fees David Goodwin - - 12,791 12,791Peter Mayston - - 1,091 1,091Michael Muller - - 9,438 9,438Peter Rogers 2,750 2,750 4,195 4,195

Payments for harvest and picking services Max McGreevy 16,592 16,592 13,214 13,214Peter Mayston 14,980 14,980 8,093 8,093Paul O’Brien 219,517 219,517 263,091 263,091

Payments for avocados Max McGreevy 13 13 1,829 1,829Peter Mayston 225 225 1,968 1,968Paul O’Brien 28,720 28,720 2,501 2,501

Payments for other goods and services Max McGreevy 46,628 32,907 32,773 32,773Peter Mayston 4,213 - 16,476 16,476Paul O’Brien - - 30,996 30,996

Purchases of packaging by directors Max McGreevy 455,649 455,649 377,092 377,092Peter Mayston 148,821 148,821 235,593 235,593

Other purchases by directors David Goodwin 35,243 35,243 4,187 4,187Max McGreevy 86,299 74,398 240 240Peter Mayston 94,386 88,597 11,505 11,505Michael Muller 30,970 30,970 5,315 5,315Paul O’Brien 117,118 117,118 10,295 10,295

The directors trade with the Group in the normal course of business. All transactions are at arms length and on normal trading terms. Parties associated with the directors contribute to a signifi cant portion of the Group’s turnover. No debts owing to or from related parties have

been written off during any year. There are no amounts outstanding at the respective balance dates.

The following transactions were entered into by the directors and/or associated parties:

Note 13 : Related party transactions

Not

es t

o th

e fi n

anci

al s

tate

men

ts (

year

end

ed 3

1 Mar

ch 2

007)

30

ap

ata

(ann

ual r

epo

rt 0

6/07

)

31

ap

ata

(ann

ual r

epo

rt 0

6/07

)

SouthLink LimitedSouthLink Limited provides logistical services for the Group and other industry parties at commercial rates. Mr Goodwin is Chairman and Mr Todd Muller a director of SouthLink Limited, representing the Apata Group.

During the year to 31 March 2007, payments amounting to $774,911 (2006: $744,256) for logistical services were made by Apata Suppliers Limited to SouthLink Limited. SouthLink Limited paid Apata Limited $9,000 (2006: $9,750) for offi ce space, $5,000 (2006: $5,000) in directors fees and $236,333 (2006: $96,142) in rebates.

Centrepac Packhouse & Coolstore LimitedApata Limited leases the building at Pyes Pa from Centrepac Packhouse & Coolstore Limited. Centrepac Packhouse & Coolstore Limited is a private company of which Mr Goodwin is a director and shareholder. The lease rental has been determined by negotiation between the parties; Mr Goodwin took no part in the negotiations or board meetings concerning this lease.

During the year to 31 March 2007, payments amounting $406,578 (2006: $360,514) for occupancy costs were made by Apata Limited to Centrepac Packhouse & Coolstore Limited.

Tetley Coolstores LimitedApata Limited leases the building at Katikati from Tetley Coolstores Limited. Tetley Coolstores Limited is a private company of which Mr McGreevy is a director and shareholder. The lease rental has been determined by negotiation between parties; Mr McGreevy took no part in the negotiations or board meetings concerning this lease.

During the year to 31 March 2007, payments amounting to $190,733 (2006: $171,324) for occupancy costs were made by Apata Limited to Tetley Coolstores Limited. In addition, as a shareholder in Apata Limited, Tetley Coolstores Limited received net cash dividends amounting to $56,670 (2006: $29,248).

Apata Suppliers Entity LimitedApata Suppliers Entity Limited (ASEL) is a separate legal entity with directors elected by Apata growers and appointed by the Group and other independent coolstore facilities. This entity does not form part of the Group.

During the year to 31 March 2007, the Group received $14,224,834 (2006: $19,688,220) from ASEL in respect of post-harvest services and fruit proceeds, and made payments to ASEL of $975,491 (2006: $150,107) in respect of post-harvest services.

The capital commitments at 31 March 2007 included $374,405 (2006: $751,609) which related to stage three of the three-stage non-pro rata share buy back arrangement entered into during 2005, whereby the Company undertook to purchase shares from shareholders over a two-year period. The second stage of the arrangement took place during the year, when 221,894 shares were acquired and held as Treasury Stock. The Company is committed to purchasing a further 220,238 shares

on or before 19 December 2007. The share price is fi xed at $1.70, being the prevailing price at the time of establishing the arrangement.

The remainder of the balance at 31 March 2007, $1,263,514, represents expenditure to complete the coolstore and site development contracts underway as at 31 March 2007. The coolstore became available for operations in April 2007.

There are no contingent liabilities as at 31 March 2007 (2006: Nil).


Estimated capital expenditure contracted for at balance date but not provided for 1,637,919 1,637,919 751,609 751,609

Note 14 : Capital commitments

Note 15 : Contingent liabilities

The Group is committed to the following leases:


Less than 1 year 1,046,449 1,046,449 850,722 850,722Less than 2 years 1,027,184 1,027,184 770,095 770,095From 3 – 5 years 1,191,180 1,191,180 1,607,274 1,607,2745 years and over 59,000 59,000 184,197 184,197

Note 16 : Lease commitments

Note 17 : Financial instruments

Effective interest rate 2007 2007 2006 2006 31.3.2007 Group Company Group Company

Bank 4.75% 1,029,303 427,707 260,126 175,924Short term deposits 5.50% 6,414 6,414 599,235 599,235 Accounts receivable - 689,109 1,093,085 1,861,800 1,850,651

Credit riskFinancial instruments which potentially subject the Group to credit risk principally consist of bank balances and accounts receivable. The Group performs credit evaluations on all customers requiring credit and

generally does not require collateral. The Group places its cash with high credit quality fi nancial institutions.

Maximum exposures to credit risk at balance date are:

The above maximum exposures are net of any recognised provision for losses on these fi nancial statements. No collateral is held on the above amounts.

Concentration of credit riskFinancial instruments which potentially subject the Group to credit risk principally consist of bank balances and accounts receivable. Except for amounts owing from related parties (as noted in Note 13), there are no signifi cant concentrations of credit risk.

Fair valuesThe carrying amount is considered to be the fair value for each of the fi nancial instruments.

Foreign exchange contractsThe Group has no foreign exchange contracts at 31 March 2007.

Credit facilitiesThe Group has a total bank overdraft facility of $2,000,000 (see Note 5).

Liquidity riskWork in progress relates to expenditure on leased kiwifruit orchard crops which will be harvested and the revenue received in the next fi nancial year. Crop failure will impact on trading revenue and the Group’s liquidity.

Interest rate riskInterest rate risk is the risk that the value of the Group’s assets and liabilities will fl uctuate due to changes in market interest rates. The Group is exposed to interest rate risk primarily through its cash balances, bank overdraft and bank borrowings.

Not

es t

o th

e fi n

anci

al s

tate

men

ts (

year

end

ed 3

1 Mar

ch 2

007)

32

ap

ata

(ann

ual r

epo

rt 0

6/07

)

33

ap

ata

(ann

ual r

epo

rt 0

6/07

)

In December 2002 the New Zealand Accounting Standards Review Board announced that New Zealand International Financial Reporting Standards (“NZ IFRS”) will apply to all New Zealand reporting entities for the periods commencing on or after 1 January 2007. The Group plans to present fi nancial statements under NZ IFRS for the year ended 31 March 2008 (i.e. adoption date of 1 April 2007).

On adoption, the Group will be required to restate its comparative fi nancial statements to amounts refl ecting the application of NZ IFRS to that comparative period. Most adjustments required on transition to NZ IFRS will be made retrospectively against retained earnings as at 1 April 2006 (i.e., the commencement of the comparative period ending 31 March 2007).

The Group has commenced a project to assess the key differences in accounting policies between NZ IFRS and current NZ Generally Accepted Accounting Practice (“GAAP”), and identify where policy changes will be required. The project team reports to the audit and risk committee, and has consulted with external specialists.

Set out on the right are the areas where there may be material differences in accounting policy and signifi cant transitional differences to the opening balance sheet as at 1 April 2006.

i) Land and Buildings Under current policy, land and buildings are stated

at cost less depreciation (see Notes 1 and 8). On transition to NZ IFRS, the Group may choose to continue this policy or to restate these assets to fair value at the date of transition. Such a change in approach will result in material adjustments to the company’s opening balance sheet. The exact impact is currently being assessed to determine the most appropriate accounting policy for the Group.

ii) Taxation Current accounting policy recognises deferred tax

balances arising from accounting and tax differences recognised in the income statement. Under NZ IFRS deferred tax is calculated using a balance sheet approach with almost all differences between accounting and tax values of balance sheet items giving rise to deferred tax balances. This change in approach will potentially result in a change in the Group’s deferred tax balances. The exact impact will be able to be quantifi ed once the decision has been made regarding the accounting policy on land and buildings.

Although the adjustments disclosed in this note are based on management’s best estimate of expected standards and interpretations, and current facts and circumstance, these may change. Therefore, until the Group prepares its fi rst full NZ IFRS fi nancial statements, it is possible that the actual impact may vary from the information presented and that variation may be material.

The Company entered into a new loan agreement with ANZ National Bank Limited for a principal amount of $3,700,000 dated 15 May 2007. The loan term expires on 15 May 2012.

On 17 May 2007 the Government announced a reduction in the tax rate for Companies, from 33% down to 30%, enacted in the Taxation (Kiwisaver and Company Tax Rate Amendments) Act 2007. The reduced rate will be effective for the Group from the fi nancial year beginning 1 April 2008. The fi nancial effects of the change in tax rate have not been brought to account in the fi nancial statements for the year ended 31 March 2007. Had the

fi nancial effect of the change in tax rate been recognised at 31 March 2007, there would have been a reduction in the balances of deferred tax assets by $4,496 and deferred tax liabilities by $10,961 and a decrease in income tax expense by $6,465.

On 28 June 2007 the Directors of the Company declared their intention to pay a fi nal cash dividend of 8.7 cents per share (2006: 7.5 cents per share), to be paid in September 2007. As the intention was declared after balance date, the fi nancial effect has not been recognised in the fi nancial statements.

Note 18 : Adoption of International Financial Reporting Standards

Note 19 : Events occurring after balance date - year ended 31 March 2007

Audit report

To the shareholders of Apata LimitedWe have audited the fi nancial statements on pages 21 to 34. The fi nancial statements provide information about the past fi nancial performance and fi nancial position of the company and group as at 31 March 2007. This information is stated in accordance with the accounting policies set out on pages 24 to 25.

Directors’ responsibilitiesThe Directors are responsible for the preparation of fi nancial statements which give a true and fair view of the fi nancial position of the company and group as at 31 March 2007 and the results of their operations and cash fl ows for the year ended on that date.

Auditors’ responsibilitiesIt is our responsibility to express an independent opinion on the fi nancial statements presented by the Directors and report our opinion to you.

Basis of opinionAn audit includes examining, on a test basis, evidence relevant to the amounts and disclosures in the fi nancial statements. It also includes assessing:• the signifi cant estimates and judgements made by the Directors in the preparation of the fi nancial

statements;• whether the accounting policies are appropriate to the company’s and group’s circumstances,

consistently applied and adequately disclosed.

We conducted our audit in accordance with New Zealand Auditing Standards. We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us with suffi cient evidence to obtain reasonable assurance that the fi nancial statements are free from material misstatements, whether caused by fraud or error. In forming our opinion we also evaluated the overall adequacy of the presentation of information in the fi nancial statements.

Other than in our capacity as auditors we have no relationship with or interests in the company.

Unqualifi ed opinionWe have obtained all the information and explanations we have required.

In our opinion:• proper accounting records have been kept by the company as far as appears from our examination

of those records;• the fi nancial statements on pages 21 to 34:

– comply with New Zealand generally accepted accounting practice;– give a true and fair view of the fi nancial position of the company and group as at 31 March

2007 and the results of their operations and cash fl ows for the year ended on that date.

Our audit was completed on 12 July 2007 and our unqualifi ed opinion is expressed as at that date.

Tauranga

Auditors’ report

Not

es t

o th

e fi n

anci

al s

tate

men

ts (

year

end

ed 3

1 Mar

ch 2

007)

34

ap

ata

(ann

ual r

epo

rt 0

6/07

)

35

ap

ata

(ann

ual r

epo

rt 0

6/07

)

Statutory information - Year ended 31 March 2007

a : Directors’ remuneration

b : Directors’ indemnity insurance

c : Use of Group information

d : Directors’ interests in transactions

e : Directors in offi ce as at 31 March 2007

The following amounts of remuneration were authorised:

The Group has arranged directors and offi cers liability insurance cover in respect of Apata Limited and Apata Suppliers Limited for $2,500,000 with QBE Insurance International Limited at a premium of $3,200 per annum. The directors and offi cers portion of the premium is $320.

During the year the Board received no notices from directors of the Group requesting to use Group information received in their capacity as directors that would not otherwise have been available to them.

Directors and their associated interests enter packaging, packing and/or coolstorage contracts with the Group on normal commercial terms and conditions in the ordinary course of business activities with the Group. There were no other material entries made in the interests register during the year.

D J Goodwin– Director of Apata Limited– Director of Apata Suppliers Limited– Director of Apata Suppliers Entity Limited– Trustee of Apata Suppliers Entity Limited Grower /

Supplier Trust– Director of Centrepac Packhouse and Coolstore Ltd– Director and shareholder of Harvestpac Packhouse

and Coolstore Limited– Director of Abbey Holdings Limited– Director of Chateau Nominees Limited– Director of Kiwifruit Supply New Zealand Limited– Director of SouthLink Limited– Trustee of Harvest Ridge Trust Orchard– Trustee of Charisma Orchard

M R McGreevy– Director and shareholder of Apata Limited– Director of Apata Suppliers Limited– Director of Apata Suppliers Entity Limited– Trustee of Apata Suppliers Entity Limited Grower /

Supplier Trust– Partner of MR & CL McGreevy (trading as

Claremont Services)– Partner of Claremont Contractors Partnership– Director and shareholder of Sheoke Orchards Ltd– Director and shareholder of Tetley Coolstores Ltd– Director and shareholder of Claremont Services Ltd– Director and shareholder of Athenberry Holdings Ltd– Director and shareholder of Fern Garden Limited


David Goodwin 32,000 32,000 14,750 14,750Max McGreevy 16,500 16,500 9,250 9,250Peter Mayston 14,750 14,750 14,750 14,750Michael Muller 14,750 14,750 9,250 9,250Paul O’Brien 15,000 15,000 9,500 9,500Peter Rogers (Finn & Partners) 16,250 16,250 9,500 9,500 109,250 109,250 67,000 67,000

The Group has provided no other benefi ts to a director for services as a director.

The Group has made no loans to a director nor has the Group guaranteed any debts incurred by a director.

Shares held Shares held 31.3.2007 31.3.2006

David Goodwin (benefi cially held) 258,209 258,209Max McGreevy (benefi cially held) 509,425 509,425Peter Mayston (benefi cially held) 554,464 554,464Michael Muller (benefi cially held) 395,530 428,863Paul O’Brien 25,000 14,974

PJC Rogers– Director of Apata Limited– Director of Apata Suppliers Limited– Director of Arrowmight International Limited– Director of Contours New Zealand Limited– Director of Contours Property New Zealand Limited– Director of Early Education Waikato Limited– Director of Eliminator Holdings Limited– Director of Fernwater Investments Limited– Director of Finch Contracting Limited– Director of Finn & Partners Trustees Limited– Director of Finn & Partners Limited– Partner of Finn & Partners, Chartered Accountants– Director of Glenview International Hotel and

Conference Centre Limited– Director of Great Oaks Holding Company Limited– Director of Lifetime Marketing NZ Limited– Director of P.R.A Investments Limited– Director of Pemberton Construction Limited– Director of Tanlaw Corporation Limited– Director of St Paul’s Collegiate School Forest

[numbers 1 to 8] Limited– Trustee of St Paul’s Collegiate School– Director of Honikiwi Forest Limited– Director of Lucknow Wines Limited– Member of Waikato University Finance Committee– Trustee of Aotearoa Institute

P M Mayston– Director of Apata Limited– Director of Apata Suppliers Limited– Director and shareholder of Bruntwood Farms Ltd– Trustee of Bruntwood Investment Trust– Trustee of Bruntwood Trust– Trustee of PM Mayston Family Trust– Director and shareholder of Maniaroa Properties Ltd– Delegate of NZ Employers Association – Orchard

and Vineyard

M Muller– Director of Apata Limited– Director of Apata Suppliers Limited– Director of Avalon Incorporated– Trustee of Equality Property Trust Incorporated– Director and shareholder of Muller & Associates Ltd– Trustee of Michael and Patricia Muller Family Trust

P R O’Brien– Director and shareholder of Apata Limited– Director of Apata Suppliers Limited– Director of Apata Suppliers Entity Limited– Trustee of Apata Suppliers Entity Limited Grower /

Supplier Trust– Director and shareholder of PR & PJ O’Brien Limited– Trustee of PR & PJ O’Brien Family Trust– Partner of PR & PJ O’Brien Partnership– Partner of PR & CI & BJ O’Brien Partnership

f : Share dealings - Company

Paul O’Brien jointly purchased a further 10,026 shares during the year. Paul O’Brien also has an interest in the 13,000 shares owned by P, C & B O’Brien, of which 3,000 were purchased during the year. The Michael and Patricia Muller Family Trust, in which Michael Muller has a benefi cial interest, sold 33,333 shares during the course of the year.

g : Employee remuneration

Remuneration and other benefi ts of $100,000 or more received by employees or former employees in their capacity as employees during the fi nancial year ended 31 March 2007 were:

Number of Apata Limited employees

$160,000-$170,000 1$120,000-$130,000 1$100,000-$110,000 1

h : Auditors’ remuneration

During the year $24,007 has been paid or accrued to KPMG as the Group’s auditor (2006: $31,902).

i : Donations

The Group did not make any donations during the year ended 31 March 2007.

36

ap

ata

(ann

ual r

epo

rt 0

6/07

)

37

ap

ata

(ann

ual r

epo

rt 0

6/07

)

Apata Limited (“the Company” or “the issuer”) has been granted a Securities Act (Apata Limited) Exemption Notice 2006 by the Securities Commission (“the Exemption Notice”). The Exemption Notice was gazetted on 27 July 2006 and expires on 27 July 2011.

The Exemption Notice grants the Company exemptions, subject to conditions, from sections 37A(1)(c) and 54 of the Securities Act 1978 and clauses 4 to 9, 11 to 20, 22 to 38, and 40 to 42 of Schedule 1 of the Securities Regulations 1983 (“the Regulations”).

The exemption in clause 5(c) of the Exemption Notice is subject to the condition that the information required by clauses 4, 5A, 6, 7, 12 to 14, 17, 18, 20, and 42 of Schedule 1 of the Regulations is contained in every annual report of the Company. The following information is provided in accordance with the Exemption Notice:

Principal subsidiaries of issuerNo subsidiary of the issuer has total tangible assets that exceed 5 percent of the amount of the total tangible assets of the issuing group.

Restrictions on directors’ powersThere are no modifi cations, exceptions or limitations on the powers of the board of the Company imposed by the constitution of the Company in force at 12 July 2007, except as provided in the Companies Act 1993, which requires the approval of shareholders to various matters including major transactions.

Substantial equity security holders of issuerThe ten largest holdings of equity securities of the issuer as at 25 June 2007 are:

None of the substantial equity security holders mentioned above undertake any liability in respect of any securities that may be offered by the Company.

Description of activities of issuing groupThe Company, one of New Zealand’s leading post harvest kiwifruit and avocado facilities, has been engaged in the following activities during the 5 years preceding 12 July 2007:– Coolstore of kiwifruit (conventional, medium term

and controlled atmosphere)– Coolstorage of avocados– Packing of kiwifruit and avocados– Conditioning and pre-ripening of kiwifruit and avocados– Laboratory services – pest management, kiwistart,

dry matter, botrytis prediction– Sales of local market and class II export kiwifruit and

avocados – Grower services– Pre-packing– Leasing and management of kiwifruit orchards

The other member of the issuing group (Apata Suppliers Limited) has been engaged in the following activities during the 5 years preceding 12 July 2007:– Logistical services for export kiwifruit

Name of substantial equity security holder Holding

1. Murray Bindon, Peter Martyn Mayston & Jennifer Mayston 554,464

2. Mike Muller, Patricia Muller & John Donald 395,530

3. Tetley Coolstores Limited 365,6124. Harvestpac Packhouse & Coolstore

Limited 238,2095. Brian Roland Earp, Jacqueline Lessel

Earp, Roland Woodroffe Earp & Anthony Charles Prentice 196,044

6. Melvyn Albert Walker, Delwyn Sonya Walker & Kevin Garty 188,086

7. Melva Ethal Allan & William Beaumont Holland 153,030

8. Stuart Barry Weston, Rachel Weston & Fenton McFadden Trustee Company Limited 147,059

9. Max Richard McGreevy & Catherine McGreevy 143,813

10. Kenneth Shaw 125,000

Securities Act Exemption Notice information

Securities paid up otherwise than in cashWithin the fi ve years preceding 12 July 2007, no securities have been paid for otherwise than in cash.

Options to subscribe for securities of issuing groupNo options have been granted or are proposed to be granted to any person.

Appointment and retirement of directorsA director may be appointed or removed from offi ce by an ordinary resolution.

At each Annual Meeting of the Company, one third of the directors for the time being, or if their number is not three or a multiple of three, then the nearest one third, shall retire from offi ce. The directors to retire in every year shall be those who have been longest in offi ce since their last election, but as between persons who became directors on the same day, those to retire shall (unless they otherwise agree among themselves) be determined by lot.

A retiring director shall be eligible for re-election.

The board of directors may by resolution from time to time appoint and remove one additional person as a director (“the additional director”). The additional director will hold offi ce for such term as is determined by the board at the time of appointment, up to a maximum term of three years. If no particular term is determined by the board, the additional director holds offi ce for a term of one year.

There are no rules relating to retirement age for directors.

Every director may, by notice given in writing to the Company, appoint any persons (including any other director) to act as an alternate director in the director’s place, either generally or in respect of a specifi ed meeting or meetings during the director’s absence or inability to act as a director. Every director may, at the director’s discretion by notice in writing to the Company, remove that director’s alternate director.

An alternate director has the right to vote in the election of other directors of the issuer.

Material contractsMaterial contracts that have been entered into by any member of the issuing group at any time in the two years preceding 12 July 2007 are:

ANZ National Bank Limited Loan Agreement for a principal amount of $3,700,000 dated 15 May 2007.

Pending proceedingsThere are no legal proceedings that are pending at 12 July 2007 that may have a material adverse effect on the issuing group.

Restrictions on issuing groupApata Limited must not make any distribution, other than a distribution out of the business profi ts which is commercially prudent at the time it is made. Such restriction results from an ANZ National Bank Limited General Security Agreement dated 27 May 2004.

There are no restrictions on the ability of any other member of the issuing group to make a distribution being restrictions that result from any undertaking given or contract or deed entered into, by the issuer or any of its subsidiaries.

There are no restrictions on the ability of any member of the issuing group to borrow being restrictions that result from any undertaking given or contract or deed entered into, by the issuer or any of its subsidiaries.

Auditors’ reportA copy of the auditors’ report on the fi nancial statements for the year ended 31 March 2007 from KPMG is attached.

Fixed Asset Use of fi xed asset Owned/ leased

Freehold land at Apata Packing & Coolstore Owned

Buildings Apata Packing & Coolstore OwnedPyes Pa (Centrepac) Packing & Coolstore LeasedWhangarei Packing & Coolstore LeasedKatikati (Tetley) Packing & Coolstore Leased

Forklifts & vehicles Truck (Apata) Packing & Coolstore LeasedUtility vehicles (6) & car Packing & Coolstore LeasedAll others Packing & Coolstore Owned

At all locations Plant and equipment Packing & Coolstore OwnedOffi ce equipment and furniture Packing & Coolstore Owned

Details regarding the principal fi xed assets held by members of the issuing group:

38

ap

ata

(ann

ual r

epo

rt 0

6/07

)

39

ap

ata

(ann

ual r

epo

rt 0

6/07

)

Company details

40

ap

ata

(ann

ual r

epo

rt 0

6/07

)

Company name Apata Limited

Company number 205019

Date of incorporation 22 August 1983

Nature of business Packhouse and Coolstore operators

Directors David John Goodwin Peter Martyn Mayston Michael Muller Max Richard McGreevy Paul Rodney O’Brien

Executive Todd Muller, Chief Executive Offi cer Peter Carter, Commercial Manager Marilyn Haywood, Operations Manager Phil Reed, Client Services Manager Colin Reilly, Chief Financial Offi cer Dinah Rutherford, Executive Assistant Tim Torr, Business Development Manager

Auditors KPMG Tauranga

Bankers ANZ National Bank Limited Tauranga

Solicitors Sharp Tudhope Tauranga

Registered offi ce Staples Rodway 132 First Avenue Tauranga

Number of shares on issue 4,505,484 ordinary shares. Of these, 45,167 were accounted for under the Treasury Stock method at

31 March 2007, and have since been placed with shareholders.

Distribution of Shareholding as at 5 June 2007

No. of % of Average shareholders Shares held shareholders % of shares holding

Up to 1,999 shares 26 35,405 9.8% 0.8% 1,362 2,000 to 9,999 shares 179 766,152 67.5% 17.0% 4,280 10,000 to 24,999 shares 35 511,746 13.2% 11.4% 14,621 25,000 to 99,999 shares 14 585,334 5.3% 13.0% 41,810 100,000 shares or more 11 2,606,847 4.2% 57.9% 236,986 265 4,505,484 100.0% 100.0% 17,002

41

ap

ata

(ann

ual r

epo

rt 0

6/07

)

apatapartners for growth

e : [email protected]

w : www.apata.co.nz

Turntable Hill Road, RD 2 Katikati 3178p : (07) 552 0911f : (07) 552 0666

Apata head office

83 Pyes Pa Road Tauranga 3112p : (07) 543 1211f : (07) 543 0096

Centrepac

37 Southend AvenueOtaika, Whangarei 0110p : (09) 430 8003f : (09) 430 8006

Northland

Apata Annual Report 2007

Documents

Transcript of Apata Annual Report 2007