Webster’s walnut area grows with cash and share deal

Webster, which has been beefing up its nut and broadacre irrigation operations in the Riverina for the past few years, paid $10 million cash for the “Motspur Park” orchard, to be topped up with a share allocation to the vendors worth about $13.1m.   

The Tabbita district property has already been managed for the past decade by Webster, which also processes Motspur’s walnuts crop at its Leeton plant.

The deal includes water entitlements and equipment.

The once-Tasmanian-based company, now headquartered at Leeton, is headed by former ports boss, Chris Corrigan, who said the purchase fitted with a strategy of “leveraging the value of our water entitlements” to maximise the company’s horticultural and broadacre operations.

“Walnuts are a core crop for the group and this acquisition is complementary to our existing walnut portfolio,” Mr Corrigan said.

Webster produces about 90 per cent of Australia’s walnut crop from about 2000ha of orchards in Tasmania and NSW, with a further 900ha of young  Riverina plantings set to produce their first harvest next year.

Its purchase of the listed Tandou irrigation business in western NSW two years ago, plus assets associated with Mr Corrigan and Australian Food and Fibre in North West NSW and southern Queensland, have made the company one of Australia’s largest irrigated farming ventures.

It has more than 40,000ha of irrigation and dryland cropping country focused on cotton, corn and cereal production, and livestock.

It is also expanding its rangeland grazing business inherited from Tandou with a planned $12.5m  acquisition of Kalabity Station in South Australia and a 13,500 Dorper breeding ewe flock.

After last financial year’s property expansion push and consolidation, including a writedown of about $96.6m in asset valuations, Webster recently posted a $4.1m after tax statutory net profit for the six months to December 31 –  rebounding from last year’s $97m loss.

While sales revenue was down 6pc to $53.2m, the company reported a $5.4m profit from water entitlement sales.

Webster expects to start picking about 12,000 hectares of cotton next month.

Meanwhile, the current walnut crop had escaped problems which affected it during pollination in the past two years and a “more normal” crop of about five tonnes/ha was expected, although global prices were “considerably lower” than in 2014 and 2015.

The company markets nuts in-shell and walnut kernel to domestic and export buyers in Europe, Asia and the Middle East.

It also runs a nursery growing out young trees for its new orchard projects plus nut drying and cracking facilities.