A $57 million write down on Oha Honey and lower farm valuations proved a bitter pill to swallow for Ngai Tahu Holdings, serving to cut profits by 76% to $37.5 million for the year to June 2019.
Ngai Tahu Holdings chairman Mark Tume, signalling a "detailed review" of all of the underlying assets of the investment holding company, said the group's farming, property development and tourism investments had also had challenging years.
These were marginally offset by the positive performances of private equity funds and Hilton Haulage, while the contribution from Ryman Healthcare was largely flat for the year, following a very strong performance in 2018.
He said the need for a review had come in light of economic "headwinds" Ngai Tahu Holdings was facing.
"This is critical in ensuring we strike the right balance between growth on one hand, and operational performance, cash flows, and managing the balance sheet tightly on the other.”
He said Oha Honey, which reported a net operating deficit of $6.3 million ahead of the write down, had been a "challenging investment."
"We underestimated the risks and overestimated our ability to manage those risks.
"Those errors on our part were compounded by three years of very unusual climatic conditions resulting in under production, lower sales, and financial underperformance."
He said the Oha management team was now fully focused on earning the value back in the business.
"Good progress is being made on improving operations and culture, but we also need a good season to achieve this."
He said farm valuations have also fallen as the sector deals with a number of changing circumstances.
The write downs and revaluations, combined with an overall distribution of $67 million to Te Rūnanga o Ngāi Tahu, saw an overall drop in shareholder equity of $53 million to $1.51 billion.
