Australian Agricultural Projects Posts 639,900 Litres Olive Oil Production for 2026 Harvest

Harvest Completes with Production Near Top of Forecast

Australian Agricultural Projects Ltd (ASX:AAP) wrapped up its 2026 olive oil harvest in early July, producing 639,900 litres. This was down from 752,600 litres the previous year but comfortably within management’s expectations. The company attributed the slightly lower oil yield per tonne to late flowering and cooler-than-usual weather, despite fruit volumes exceeding initial forecasts. This result also marks a recovery from the 551,500 litres produced in the 2024 “off-year”.

New Orchard Management Delivers Strong Yields

For the first full season since the cessation of the VOOP project operations in July 2025, Australian Agricultural Projects directly managed a 285-hectare orchard section. This area produced a robust 428,100 litres, reflecting improved yields after frost damage in 2025. The company emphasised that over 96% of the season’s production met premium extra virgin olive oil standards, highlighting effective orchard management and quality controls.

Seasonal Cash Flow Outflow Aligns with Business Cycle

The company recorded an operating cash outflow of $815,000 for the June quarter, consistent with seasonal patterns where harvest-related costs peak before significant sales receipts are received. Receipts of $723,000 primarily related to final proceeds from the prior season’s harvest. Australian Agricultural Projects expects operating cash flows to return to positive in the coming quarters as sales of the 2026 harvest materialise.

Debt Reduction and Capital Allocation Plans

During the year, the company used operating cash surpluses to reduce term debt, though borrowings of $1.96 million were redrawn in the June quarter. The company holds secured bank loans with NAB and an unsecured shareholder loan from a related party. With replanted trees reaching full production, management anticipates generating surplus working capital. This will be directed towards further debt reduction, orchard infrastructure upgrades, and simplifying the project structure to boost long-term shareholder returns.

Stable Retail Pricing Underpins Revenue Outlook

Retail prices for Australian extra virgin olive oil have remained relatively stable over the past year. Australian Agricultural Projects sells its production under a supply agreement with Cobram Estate Limited, maintaining exposure to this segment. Management continues to monitor pricing trends closely to inform future financial planning.