By Andrew Gomes
Advertiser Staff Writer
The world’s largest grower of macadamia nuts lost money last year after a string of foul weather, low prices and a disagreement with its sole customer dragged the company into the red following a profitable 1999.
Honolulu-based ML Macadamia Orchards LP, a publicly traded partnership in which Big Island-based C. Brewer & Co. Ltd. is the general partner, yesterday reported a 2000 net loss of $398,000, or 5 cents a share, compared to a net profit of $4.6 million, or 61 cents a share, the previous year.
Revenue was also lower, reaching $13.8 million last year compared to $15.9 million in 1999.
Most of the damaging results came in the fourth quarter, when ML Macadamia accrued a net loss of $1.5 million on revenue of $5.1 million, compared to net income of $3.6 million on revenue of $7.6 million for the same quarter the previous year.
The company said its exclusive customer, Mauna Loa Macadamia Nut Corp., withheld $931,000 of expected revenue by refusing to pay for 1.8 million pounds of delivered nuts during the quarter.
Gregory Sprecher, ML Macadamia senior vice president, said contracts requiring Mauna Loa to pay for all delivered nuts regardless of their condition are being disputed by The Shansby Group, a San Francisco investment firm that bought Mauna Loa from C. Brewer and others last September. Mauna Loa started underpaying in October, he said, and ML Macadamia sued the company in December to recover full payment.
"The contracts are unambiguous," Sprecher said. "They say they (Mauna Loa) must pay for all the nuts we deliver to them. They may not deduct for nuts that may or may not be usable."
Sprecher said the contracts were written by C. Brewer to enhance the value of ML Macadamia, which it sold in 1986. "It was designed on purpose that way," he said.
Mauna Loa officials could not be reached for comment late yesterday.
ML Macadamia, which grows macadamia nuts on about 4,000 acres of Big Island land, delivered many poor-quality nuts because of bad weather. A drought for much of the year in Ka‘¬ hurt production. Then the company lost an estimated 2 million pounds of nuts to a November flash flood.
Production totaled 21 million pounds last year, down 18 percent from 25.6 million pounds harvested in 1999.
Reduced quality also resulted in depressed prices, which averaged 51 cents a pound last year, compared to 62 cents in 1999.
ML Macadamia stock closed at $4.39, up 9 cents yesterday in heavier than usual trading.
Andrew Gomes can be reached by phone at 525-8065, or by e-mail at agomes@honoluluadvertiser.com.
[back to top] |
