Cobram Estate Olives Doubles US Sales Amid Record FY25 Profits
Cobram Estate Olives Limited has reported record financial results for FY2025, driven by strong sales growth in Australia and a doubling of branded sales in the USA. The company is shifting its capital expenditure focus to expand its Californian operations while maintaining sustainable growth in Australia.
- Record EBITDA growth of 74.8% to $116.6 million
- Global sales revenue up 12.1%, with Australian branded sales rising 16.6%
- USA branded sales more than doubled to $42.3 million
- Transition to sustaining CAPEX in Australia; growth CAPEX focused on US expansion
- FY26 dividend expected to increase to 4.5 cents per share, fully franked
Strong Financial Performance
Cobram Estate Olives Limited (ASX, CBO), Australia’s largest vertically integrated producer of premium extra virgin olive oil, has delivered a standout FY2025 performance. The company reported a record EBITDA of $116.6 million, up 74.8% from the previous year, alongside a net profit after tax soaring 167.8% to $49.6 million. This robust financial outcome was underpinned by a 12.1% increase in global sales revenue, driven by sustained demand for its premium brands.
Sales Growth in Australia and the USA
Australian branded sales, encompassing the Cobram Estate® and Red Island® labels, grew 16.6% to $141.4 million, despite supply constraints. Meanwhile, the company’s US operations saw a remarkable 101% increase in branded sales to $42.3 million, reflecting successful market penetration and brand recognition. Cobram Estate® is now ranked as the #9 top-selling olive oil brand in US supermarkets by value, and the #2 Californian olive oil brand, highlighting its growing footprint in a competitive market.
Capital Expenditure and Expansion Strategy
FY2025 saw Cobram Estate invest $81.5 million in capital projects across Australia and the USA. Key Australian projects, including the Boort olive mill upgrade to 80 tonnes per hour capacity and warehouse automation, have largely concluded the growth phase, with a transition to sustaining CAPEX of $10–15 million annually from FY26. In contrast, the company is accelerating growth investments in California, acquiring 1,596 hectares of land to nearly double its grove footprint to approximately 2,000 hectares, alongside bottling and warehouse expansions at its Woodland site.
Operational Outlook and Agricultural Cycles
Looking ahead, FY26 is expected to be an “off-year” for Australian olive production due to the natural biennial bearing cycle, with crop yields forecasted to be moderately lower but supported by maturing groves. In the USA, production is anticipated to remain stable, with a higher proportion of olive oil coming from CBO’s own groves as trees mature. The company’s leadership transition includes Joint-CEO Leandro Ravetti relocating to California to bolster US operations, signaling a strategic focus on expanding the American market.
Sustainability and Innovation
Cobram Estate continues to lead in sustainability, advancing its 2030 targets through initiatives like a sustainability-linked loan, zero-waste programs, and extensive research collaborations. Technological investments such as automated guided vehicles in warehouses and proprietary production systems contribute to operational efficiency and cost control, reinforcing the company’s competitive edge.
Bottom Line?
Cobram Estate Olives’ FY25 results set the stage for sustained growth, with US expansion and sustainability initiatives poised to shape its next chapter.
Questions in the middle?
- How will the biennial crop cycle impact Cobram Estate’s FY26 profitability and cash flow?
- What are the risks and timelines associated with the large-scale US grove expansion?
- How might rising water costs and agricultural variables affect future operating margins?
