New apple adds crunch to Turners listing

By Duncan Bridgeman

Friday 1st October 2004

Turners & Growers hopes a new apple variety will help drive international growth for the recently listed company.

Jazz a new apple from Turners' subsidiary Enza has been touted as the next mainstream variety in an industry where global producers continue to fight a bitter licensing war.

The rich-coloured, crisp apple, developed by Hort Research with funding from Enza's variety development programme, has already made inroads into Europe and North American markets.

Turners' trump card is that Enza has exclusive worldwide marketing and distribution rights for Jazz and the company hopes that this will ensure no supermarket will be able to obtain a generic version.

Obtaining this patent is a big plus for Enza because global supermarket chains are increasingly exploiting loopholes in royalty schemes enabling them to sell unbranded apples at the same price as branded produce.

Turners, which listed on the main board of the stock exchange on Wednesday at $3.20 a share, says the Jazz apple will reach significant commercial production in 2006.

About 35,000 cartons were expected to be sent to shops in Europe, America and Asia this year.

By full production in 2012, the company expects to provide about six million tray equivalents.

Turners managing director Michael Dosser said he hoped the company could emulate the success of Zespri International's Gold kiwifruit variety.

The apple, a cross between Royal Gala and Braeburn, was now being planted in the US, France, Australia, Chile and New Zealand, he said.

To date more than 89 hectares had been planted with the company hoping the northern and southern hemisphere's will each produce 50% of the volume, ensuring year round production.

Dosser said the company had various expansion plans but it was too early to highlight them.

He said the company would largely stick to its core business of horticulture, citing the recent venture into tomatoes as an example of diversification.

Turners' fresh export operations contributed $269 million of revenue to the group last year 45% of total revenue.

Net profit for the year to 2003 was just under $12 million.

Dosser and Turners chairman Tony Gibbs were full of smiles on Wednesday when the company marked more than 100 years in operation by finally listing on the NZX.

The shares quickly lifted to $3.39 despite the absence of new equity.

The company is 78.3% owned by Sir Ron Brierley's investment vehicle Guinness Peat Group.

Banana company Bonita owns another 10%.

Gibbs said the company had come a long way from a fruit shop on Karangahape Rd in Auckland and it was pleasing to see a primary sector company listed for a change.

The market is widely expecting GPG to sell down part, or all, of its stake as it did when it spun off Turners Auctions last year.

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