July 3, 2003

Minister Lauds Market Leader's East Coast Iwi Initiative

Award-winning Comvita New Zealand yesterday presented East Coast iwi with a cheque for $11,700 representing the proceeds from the first collection of honey from beehives installed on Maori land at Waipiro Bay, East Cape.

Commenting on the ground-breaking initiative between Comvita and Ngati Porou, the Minister of Maori Affairs, Mr Horomia, said from Parliament yesterday he congratulates all those involved in the project for their vision and the professionalism they have displayed.

"I always enjoy recognising the diverse talent and innovative programmes that our people are engaged in," said the Minister.

"This is a good example of iwi working together with a successful company to provide positive outcomes. Congratulations to Ngati Porou - especially those people from Waipiro Bay who had the foresight to give projects like this a chance."

Mr Horomia said Comvita is an example of a business that has gone from humble beginnings to one which was last month named Consumer Products Exporter of the Year for 2003.

In presenting the cheque to hapu representatives at the Kiekie Marae, Comvita CEO Graeme Boyd described the occasion as another step in an ongoing journey.

"The next step in the journey is for the land-owners involved to identify a suitable candidate, or candidates, to be trained in beekeeping," he said. "Comvita will assist with this process."

Comvita's executive director Alan Bougen reminded the land-owners the concept behind the initiative was for the hapu to eventually purchase the hives and run them as a stand-alone operation.
"This venture provides a wonderful opportunity for the land-owners around Waipiro Bay to produce active manuka honey on otherwise unproductive land," said Bougen.

More than 12,000kgs of honey was collected last January from the 300 beehives supplied by Comvita - a top result according to the company's operations manager, Chris Elmsly.

"The hives each yielded around 40kgs of honey," said Elmsly. "This as a very good start. The result reflected the excellent (honey collection) season Comvita enjoyed nationally."

Extraction of the honey from Waipiro Bay was carried out at beekeeper Stephen Weenink's Bay of Plenty extraction facility. The product was packaged at Comvita's Paengaroa manufacturing plant.

Only a small amount of the honey collected had the unique manuka factor (UMF), the special antibiotic property unique to manuka honey. This does not concern Elmsly who points out the vagaries of climate and other unknown factors could just as easily result in all next season's honey having a high UMF.

Manuka honey is taken for digestive health and used as a topical application to help heal wounds. Comvita's WoundCare product is becoming increasingly popular, here and overseas, as its healing properties become known.

Graeme Boyd said the positive start to the East Cape project bodes well for duplicating this (project) with other iwi in areas where manuka thrives - such as Northland and parts of the central North Island.

The East Cape project began last year with the delivery of 300 hives, along with their resident bees, to strategic locations around Waipiro Bay. The hives, valued at approximately $40,000, were sourced from the South Island to avoid varroa mite problems.

End

News Release
June 23, 2003

Comvita Announces Intention To Be Among First To List On The New AX

Complementary health products market leader and Unlisted Securities Market issuer Comvita New Zealand plans to be one of the first companies to list on the NZX's new AX (Alternative Exchange) when it opens in August.

Riding high after winning a prestigious Trade New Zealand export award last week, Comvita is confident listing on the new market will lift the company's profile for the benefit of investors with an interest in the growth of natural health products.

"Listing on the AX will make us more public and give us better access to capital," according to Bill Bracks, chairman of Comvita.

Speaking from the company's Bay of Plenty headquarters today, Bracks says Comvita's Board has agreed to the new listing as part of the company's continuing growth strategy.

"If we continue to grow at our historical rate, there will be no problem in accessing high levels of funding where that is necessary" he asserts.

"There will be more share trades and wider shareholdings which will be linked to higher profits. A broader shareholder base will become a strength of the company."

Comvita's CEO Graeme Boyd agrees and adds that the company needs further investment. "The USM has provided a vehicle for shareholders to value and trade their shares," says Boyd. "It succeeded in that. We've gone from two shareholders in 1998 to 132 in 2003."

Since listing on the USM, Comvita's shares have been trading around $1.15 and $1.20.

Bill Bracks points out that the AX is being developed by the NZX (formerly the NZSE) to facilitate a more cost-effective, flexible public capital raising facility for New Zealand companies. He says Comvita is right behind the NZX in its efforts to create a market that will act as a catalyst for growth in New Zealand's capital markets.

"As an unlisted company, we feel the AX offers major advantages for Comvita," he says. "Aside from the obvious advantages of lower costs and streamlined processes, an AX listing will give us more liquidity."

Bracks is keen to see Comvita take a lead in listing on the new market. "If we're not the first to list, we'll certainly be the first natural health products company to list."

END

Publication Date: 13 June 2003
Source: Trade New Zealand

COMVITA NZ IS CONSUMER PRODUCTS EXPORTER OF THE YEAR

New Zealand’s Consumer Products Exporter of the Year is Comvita New Zealand, a Bay of Plenty company that started out manufacturing natural health products derived from honeybees in a garage in 1974.

The Trade New Zealand Export Award was presented at a gala dinner in Christchurch on June 12. Comvita New Zealand was one of 10 category winners.

The judges said Comvita was a classic example of how important the natural products industry can be to the growth of the New Zealand economy, by focusing on small, niche markets.

Comvita CEO Graeme Boyd says sales last year were $18.7 million. While about half that figure was direct exports, he says in reality about 75% of Comvita’s products end up offshore – with the balance either exported by other enterprises or taken back home by international tourists.

He says exports have been growing at 50% per annum since the late 1990s, boosted by a major expansion and restructure and following Comvita’s entry into the Australian market.

The Te Puke-based operation manufactures and markets a wide portfolio of natural health products derived from honeybees – honey, propolis, pollen, royal jelly and venom. The products are formulated and packaged into various applications – for example lozenges, elixir, throat spray and tablets – designed to appeal to different audiences, including digestive health, immune functionality and good nutrition.

Mr Boyd says Comvita positions its products at the premium end of the market, with the Comvita brand a key competitive advantage.

“We have developed a strong and well recognised international brand. One of our major points of difference is New Zealand – it provides us with a clean, green image, and the country itself provides us with the highest quality natural products found anywhere in the world.”

Comvita exports to 10 countries, with major markets Australia, the United Kingdom, Hong Kong, Japan, Korea and the US.

Mr Boyd says a key achievement has been the rapid growth in exports to Australia since Comvita entered the market in 1999. With annual sales of about $2 million last year, Australia is now its largest export market.

He says sales throughout Asia are also growing strongly, with people reaching for products such as propolis in an effort to build up immunity against the SARS virus.

Last year Comvita established its first 100% subsidiary offshore in Japan, part of its strategy to become more involved in its offshore markets in order to maximise export opportunities and control its future.

“In essence we are evolving from being an exporter to an international marketer,” says Mr Boyd. “We are moving towards having our own people on the ground in our offshore markets, rather than working through a distributor who handles products from many different companies.”

With demand for Comvita products continuing to increase, Mr Boyd says further expansion is required. In order to finance its growth, the company went onto the Unlisted Securities Market last year, with 130 shareholders investing in the business.