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Cobram Estate Olives (ASX: CBO) has forecast an underlying EBITDA for FY25 that would far exceed any previous result at $115 million, as the group also announces the acquisition of Mildura-based farm machinery business Leda Ag and the imminent relocation of its joint-CEO Leandro Ravetti to California.
The forecast compares to $66.7 million statutory EBITDA in the last financial year, and its highest earnings result in recent years of $70.3 million in FY21.
The company completed its 2025 olive harvest last week, milling more than 80,000 tonnes of the fruit which delivered production of 14.2 million litres, of which 13.2 million litres came from its own groves with the remainder contract-processed for a third party.
As olive groves follow biennial cycles of 'on' and 'off' years for years, the crop for an 'on' 2025 was always going to be larger, but total production was also up 10.2 per cent on 2023.
"This is a pleasing result considering the short-term yield reduction following the completion of our replanting program after the 2023 harvest," the company stated in its announcement to the ASX this morning.
"The removal of approximately 100,000 mature trees (271 hectares) led to a temporary reduction in production, as these trees had previously contributed meaningfully to our output.
"These trees have since been replaced with ultimately higher-yielding varieties, positioning us for stronger long-term performance."
Cobram adds that its most recent development at Boort near Bendigo, comprising nearly 150,000 trees across 410 hectares, has not yet commenced production. So even though 2026 will be an 'off' year, because groves are still maturing the crop is expected to be only moderately lower.
"The olive oil quality is very good, and the company will have sufficient supply to meet the requirements of its packaged goods sales plan through to the 2026 harvest," the group adds.
"Sales in both Australia and the USA continued to remain strong in the second half of FY2025, driven by the demand for high quality, locally produced extra virgin olive oil (EVOO).
"We continue to see strong sales results from our premium brand, Cobram Estate, which has been responsible for most of the company’s sales growth in both Australia and the USA."
As Cobram grows rapidly in the USA, where it has more than 1,000 hectares planted with almost 800,000 olive trees, joint-CEO Leandro Ravetti will relocate to California in September.
Ravetti has been with Cobram since 2001 when there was "hardly any production of domestic olive oil" in Australia, having worked previously at Argentina’s National Institute of Agricultural Technology.
"This decision made by the company is aimed at increasing the support provided to the outstanding executive team in the USA, better positioning CBO to take advantage of emerging opportunities, and enhancing the interaction between the two locations that are expected to become similar in terms of strategic and economic importance to the business in the medium term," Cobram said in the release.
"With his presence in the USA, Leandro will be able to continue to foster the Company’s values in an actively growing team, and to increase our corporate presence in line with our growing leadership in the American olive industry."
Cobram's other joint-CEO Sam Beaton will remain in Australia.
"Leandro and Sam will continue to have clear influence over their respective areas of expertise in both countries, Leandro on operations and technical, and Sam on commercial and financial. Leandro and Sam will both continue to travel between sites and to be an active part of their respective areas as required," the group clarified.
Vertical integration is the name of the game in another announcement today with Cobram revealing the acquisition of farm machinery business Leda Ag, a trusted partner of the grower-miller-marketer for more than two decades.
The group will pay approximately $3 million upfront with additional earn-outs of $2 million over four years for the vendors of Leda, which builds most of Cobram's Colossus harvesters and has delivered services and parts over the years.
Included in the purchase price is all the existing Leda Ag machinery, spare parts and the intellectual property and know-how relating to the build of olive harvesters. All Leda Ag employees have now joined the Company
"The primary reason for the transaction is to enable the company to bring in house specialised skills to accelerate the development of more reliable, faster and more efficient olive harvesters, a project that has been underway for five years and is already yielding material benefits," Cobram said.
"The purchase will also enhance the servicing and performance of our existing olive harvesters and is expected to deliver cost savings through more efficient purchasing, servicing and manufacturing of parts relating to our entire farm machinery fleet and allow Leda Ag to focus principally on our needs.
"Over the medium term, we expect this will deliver significant costs savings and operational efficiencies to the Company, both in its Australian and USA operations."
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