2018 Annual Report

ANNUAL REPORT
• 2018 •
BEEKEEPING SINCE 1974

2 3
COM V ITA
®
M A N U K A H O N E Y,
44 YEARS OF NATURE IN THE MAKING
FINANCIAL SUMMARY 5
FROM THE CHAIRMAN 6
FROM THE CEO 7
INVESTING IN OUR BR AND 9
CEMENTING OUR POSITION
IN NORTH AMERICA AND
CHINA 10

SOURCE TO SHELF 12
CATEGORY LEADERSHIP 14
SUSTAINABILITY 16
HEALTH AND SAFET Y 17
BOARD OF DIRECTORS 18
LEADERSHIP TEAM 19
FINANCIALS 20
GOVERNANCE 23

4 5
YEAR IN REVIEW –
STRONG REBOUND
RETURN TO
OPER ATING PROFIT
N E T S A L E S
I NC R E A SE D 19%
F ROM F Y 17
OUR BRAND
HEALTH REMAINS
VERY STRONG
$186m
*
F ull Year Sales
$9.3m
Operating efficiencies
In thousands of New Zealand dollars
30-Jun-1830-Jun-17
(15 months)
30-Jun-1631-Mar-1531-Mar-14
Operating revenue178,493 155,879 2 30,74 3 152,702 115,283
Operating revenue growth rate15%-32%51%32% 11%
Export revenue %79%77%76%68% 78%
Gross profit73,195666 62,141 117,311 71,552 60,359
Gross profit %41%40%51%47% 52%
EBITDA (i)20,5181119,812 39,445 22,950 16,981
EBITDA % of operating revenue11.5%12.7 %17.1%15.0% 14 .7 %
Earnings before interest and tax -
EBIT
14,33612,984 30,799 17, 414 12,839
Net profit before tax - NPBT11,1399,352 26,299 14,489 11,101
NPBT % of operating revenue6.2%6.0%11.4%9.5% 9.6%
Net profit after tax - NPAT8,211 9,822 18,477 10,244 7,9 72
NPAT % of operating revenue4.6%6.3%8.0%6.7 % 6.9%
Total a ssets318,567 256,692 243,268 199,72 2 14 8,746
Total assets per share7.056.11 6.15 5.07 4.69
Total shareholder funds189,692 163,875 131,839 118,679 92,082
Shareholder equity ratio59.6%63.8% 54.2% 59.4% 61.9%
Net debt91,753661,928 84,020 26,093 26,489
Net debt to EBITDA4.5x 3.1 3.1 x 2.1 x 1.1 x 1.6 x
Net interest cover4.5x3.6 x6.8 x 6.0 x 7. 4 x
Net debt to equity ratio48.4%37.3 7.8%63 .7 % 22.0% 28.8%
Earnings per share NPAT (NZ cents)18.252 3.72 3 .7446.91 29.88 26.12
Dividend per share (NZ cents)6.002.02.0018.00 13.00 12.00
Return on sales - ROS (ii)8.0%88.3% 13.4% 11.4% 11.1%
Return on capital employed - ROCE
(iii)
5.1%5.8% 14.3% 12.0% 10.8%
FINANCIAL SUMMARY
2014-2018
(i)
EBITDA – earnings before interest, tax, depreciation and amortisation
(ii)
ROS = EBIT / Total Operating Revenue
(iii)
ROCE = EBIT / (Total Shareholder Funds + Net Debt)
*
China JV sales elimination of $9.3m is deducted from this

7
The 2018 financial year was somewhat of a
“rollercoaster”. Right up until early in the 2018 calendar
year, we were confident in achieving a NPAT of greater
than our record of $17.1m in 2016. Unfortunately, the
weather did not play its part and for the second season
in a row, the honey harvest was poor. We signalled this
to the market on 16 April 2018 when we announced our
after tax operating earnings for the year ended 30 June
2018, would likely be in the $8m to $11m range.
The actual after tax operating earnings of $9.3m
masked the $14.8m turnaround in our operating result
from a loss of $5.5m in FY17. The impact of the poor
honey harvest on our profitability is depicted in the
chart below.
The other significant event was the Board decision
to allow a third party to undertake due diligence on
Comvita. This process diverted a considerable amount
of Board and management time. The Board did not
undertake this process lightly and only allowed due
diligence after fully understanding the prospective
buyers’ credentials, and after receiving a non-binding
proposal on the price they would pay for 100% of
Comvita. However, in negotiations that followed
our profit downgrade on 16 April 2018, we could not
agree with the potential bidder on price. The Boards’
unanimous view was it would only recommend a sale
of the business if it created exceptional value for
all shareholders.
Subsequent to a bid not proceeding, and with the
benefit of feedback and excellent strategic analysis
from the potential bidder, the Board and management
took the opportunity to reappraise Comvita’s strategic
direction. The Company has decided to focus our
strategy on continuing to build on our early leadership
position in Manuka honey and Propolis. This means
we will run a leaner, more focused business model
with a lower overhead cost. At the same time, we will
be increasing our marketing spend in support of the
Comvita brand in all key markets. We have started
the new financial year in strong heart and have a
full inventory of high quality Manuka honey which,
irrespective of what the next honey season produces, we
expect to grow revenue and profitability strongly. Total
dividends for the year of 6 cents per share were paid,
which is 29% of after tax operating earnings. This payout
ratio, as advised to the market in our Full Year Result on
21 August, signals our intention to lower the dividend
payout ratio to a range of 25-30% of after tax operating
earnings. The Board believes this to be more appropriate
for a high growth company with ongoing demand for
cash to fund growth.
For the first time we are illustrating separately, our
apiary business (‘SupplyCo’) and our branded business
(‘BrandCo’), in order that the market can gain a more
accurate ‘picture’ of performance of the two distinct
parts of our business.
As outlined in the chart below, the harvest impacted
our apiary joint ventures (JVs), and instead of a $4.5m
after tax profit, our SupplyCo business incurred a $6.2m
loss after tax, fundamentally changing our result from
an expected position of a net profit after tax of greater
than $17.1m.
Our BrandCo business is in good health and performed
very well during the 2018 financial year, after a tough
year due to regulatory changes affecting the
‘grey channel’ into China during FY17. Our branded
business made a NPAT of $15.5m, compared with $1.0m
in the prior year.
FROM THE CHAIRMAN
6 7
NEIL CRAIG
SUPPLY AND BRAND AFTER TAX OPERATING EARNINGS SPLIT
2017 Actual
Supply
2018 Guidance2018 Actual
Operating NPAT ($m)





()
()
(.)(.)
.
.
.
.
.
(.)
.
BrandTotal
.
FROM THE CEO
We are very pleased with a return to after tax
operating earnings for FY18 of $9.3m verses the
prior year loss of $5.5m, a turnaround of $14.8m.
Sales growth was driven by a rebound in
our Australasian business and strong sales to
North America.
North America had an exceptional year, driven
by sales to Costco and by excellent growth of
e-commerce sales in Amazon. Overall sales in
North America grew to $26.8m.
Our new China JV has performed well in its first year
of operations with sales meeting expectations at
$46m and profit ahead of projections, with our 51%
share of earnings being $3.3m. A good start to our
business inside China.
Raw material inventories grew from $60m to $89m
which we funded with additional debt facilities as
we deliberately took a more aggressive approach
to acquiring inventory. As global retailers start to
adapt to the new Ministry for Primary Industries’
(MPI) regulations, we want to be ready for market
opportunities when they present themselves.
Furthermore, it has been the second poor season
in a row and we were conscious of securing enough
inventory early to satisfy our full year expectations.
As a result of two ‘below average’ honey seasons, we
have reshaped our apiary business to be profitable at
a lower level of harvest by changing our operational
plan. Through careful site selection and analysis of
the profile of the honey, we will be more resilient as a
business in the event of a future poor harvest.
Comvita is increasing its strategic focus on Manuka
honey. Our Manuka plant breeding programme
is starting to produce excellent results. We have
improved the Dihydroxyacetone (DHA) quality in
nectar across different varieties while extending
flowering periods to mitigate geographic and weather
risk. DHA is the precursor to the UMF™ activity of the
Manuka honey. We are also focused on developing
plants that improve plant vigor and pest and disease
tolerance. We believe the industry is naturally
expanding its supply base at the lower end of the
UMF
®
spectrum through increasing hive numbers,
whilst Comvita will be sourcing future high UMF
®

honeys from Manuka plantations.
We have significant market opportunities ahead
of us, particularly in China and North America.
Our strategic focus is to build distribution into the
natural and specialty channels in North America
and to continue to grow our relationships with key
Chinese e-commerce, and cross-border e-commerce
platforms. We intend on expanding our retail
distribution inside China and Hong Kong.
At Comvita, we take safety seriously. We have
focused on managing our critical safety risks as
well as strengthening the visibility of our Health and
Safety performance indicators, particularly around
proactive reporting.
SCOTT COULTER

8 9
INVESTING IN OUR BRAND
While the 2017/18 season has been challenging from a
harvest perspective, there have been many positives for the
Manuka honey industry:
• Consumer demand for Manuka honey in mainland
China continues to grow.
• The USA is now competing with the United Kingdom,
Australia and China to be the biggest export market for
New Zealand honey.
• The New Zealand Government introduced a General
Requirement for Export for Manuka honey; a positive
move in ensuring consumers receive genuine true-to-
label Manuka honey.
Comvita has been investing in research to deepen our
understanding of our consumers. We have a new consumer
segmentation model, which provides greater insight into
the lives of our consumers across core and emerging
markets. We know the role our products play in their lives,
hurdles to purchase, and the key product attributes to
communicate inline with their preferences.
We have extended our brand tracking across all key
markets and are pleased to see our leadership position in
the key markets in which we operate strengthen. We intend
to further strengthen this position over the coming years to
maintain our global #1 position in Manuka honey.
Our consumers have been telling us our packaging could
better communicate our brand’s heritage, and more clearly
demonstrate our high-quality and premium position.
As such, we are rolling out a new visual identity for all
Comvita Manuka honey packs from April 2019. Having
new embossed pots and lids, cartons and brand booklets
will allow us to tell a deeper source to shelf story, while
improving functionality and navigation. This investment in
our brand will be supported by above-the-line advertising,
social media marketing, and new point-of-sale assets to
support our retail partners.
We are focused on growing our resource and capability in
digital and social marketing, and will be increasing
our investment in public relations, marketing communications,
and advertising in our two focus markets; China and
North America.
In January, we hosted a group of eight American lifestyle
journalists, bloggers and influencers in New Zealand, including
a registered dietician and a nutritionist. The purpose of the
week-long tour was to immerse the group in Comvita’s world
of beekeeping, Manuka breeding and planting, honey quality
processes and extraction. From this investment, Comvita
achieved significant exposure in North America. The tour
generated digital media impressions of 23 million, via coverage
in several top-tier outlets, including Reader’s Digest and
Health.com (Time Inc), as well as social media impressions of
1.2 million.
Another key milestone has been our strategic investment
for 20% of Apiter, our long-term, Propolis supply partner to
Comvita, based out of Uruguay. Apiter is South America’s
premier supplier of Propolis, and this investment will help us
to capitalise on our supply of pure, flavonoid-rich Propolis. It
will also allow us to leverage off Apiter’s 40+ years of Propolis
research and development.
In China and Hong Kong, Propolis is a well-known and revered
immunity product, and in these markets, Comvita takes a
super-premium, imported position in this category.
We will be investing in communicating the superior product
attributes of Comvita Propolis over competitors’, and
Propolis will become a major focus of our innovative product
development pipeline.
Comvita is a registered trade mark of Comvita Ltd.

10 11
FY18 was marked by significant revenue
growth in North America. The key driver
was selling into Costco warehouses
across four of the eight regions and all
of Canada. This made Comvita the most
widely distributed Manuka honey brand in
North America.
Additionally, Comvita continues to grow
its presence in the North American market
via e-commerce, led by Amazon with a
growth of 53%.
Comvita’s JV with Shenzhen Comvita
Natural Food Co in China commenced on
1 July 2017. Since then, we have worked
hard to establish a strong organisational
structure within the JV and build
capability among the team, to grow even
greater distribution in China.
Offline, we partnered with 20 new
distributors in FY18, making Comvita
products available on more shelves
throughout China. Through strategic
branding activities instore, we have grown
sales, brand awareness and our consumer
base. The Comvita brand remains number
one in the nutrition category at Ole -
China’s premier supermarket chain.
We have developed a strong
North American team to continue
to build and diversify distribution of
Comvita products throughout the USA
in FY19 and beyond.
In market, we have strong digital
marketing and public relations programs
running to increase brand awareness
and demand for our products. We
believe with a targeted focus on our
core Manuka honey range, we will see
continued growth in what is a strategic
growth market for Comvita.
Online, we partnered with additional
e-commerce platforms, including Amazon
China, Tmall Supermarket and Hema.
For the first time we stepped into WeChat
commerce, selling our products via WeChat
accounts with a vast number of fans. As well
as growing sales, this channel has allowed
us to better and more frequently promote
our brand to Chinese adorers.
New product development centred around
UMF
®
and multiflora honey has driven
sales growth in China during the year and
positions Comvita well for continued growth
into the future.
CEMENTING OUR POSITION IN
NORTH AMERICA AND CHINA
COREY BLICK
SENIOR VICE PRESIDENT
- NORTH AMERICA
VICTOR CHEN
GENERAL MANAGER
- CHINA

12 13
SOURCE TO SHELF
OUR PROMISE
FY18 proved to be another testing year,
with a consecutive poor honey season
combined with the introduction of the
MPI Manuka definition.
Fortunately, our apiary business
was well prepared as we entered
the 2017/18 season, and accordingly
we were able to make the best of
the inclement conditions and poor
honey flows.
The delay in finalising the MPI Manuka
definition created some uncertainty
as we entered the procurement and
packing season, however, as the
12 13
chemical markers comprising the
new definition were finalised and
agreed, we were able to adjust our
tactics accordingly.
Fortunately, and as predicted, Myrtle
Rust has proven to be low risk. Despite
intensive industry surveillance, no
further cases have been identified
within Leptospermum scoparium.
MPI is continuing to monitor the
situation and we have also undertaken
a screening programme to ensure
appropriate biosecurity around our
plantation initiatives.
Our Manuka plantation activity is on
track with our stated strategy, and
it is pleasing to note the improved
characteristics of cultivars resulting
from our selection and improvement
programmes. We are now yielding
Manuka honey from our early
plantations and can confirm the
outcomes are consistent with our
economic modelling.
We have maintained a focus on
operational excellence at all
processing locations and can
report productivity gains and
capacity improvements across our
key ingredient platforms; honey,
Propolis and Olive Leaf Extract. Thus,
providing a solid platform to support
our source to shelf strategy.
For 2019, our focus will be on service
delivery with a relentless focus on
our customers.

14 15
CATEGORY LEADERSHIP AND
INDUSTRY CONSOLIDATION
MPI DEFINITION
The MPI Manuka definition was always going to cause some
disruption within the industry, and as expected, not all
producers have fared as well as Comvita. We were well
prepared for the change, having the advantage of a
well-equipped laboratory, a good inventory position, and
good procurement relationships.
Predictably, at a procurement level, the price of genuine
Manuka honey has risen slightly, however the price for
non-Manuka honey has fallen as fringe operators will now
not be able “pass this honey off”. Ultimately, this means a
better deal for the consumer and a fairer marketplace for
reputable brands.
The next priority for MPI is to sort out the local market. In
July 2018, MPI announced they were seeking submissions
on whether the same rules for exported product should be
applied to the New Zealand domestic market. Comvita has
made a submission confirming our support for the proposal,
and we hope this will take effect later this year.
Comvita has maintained high levels of industry
representation this year, holding governance positions within
Apiculture New Zealand (ApiNZ), the UMF
®
Honey Association
(UMFHA), Manuka Research Partnership Limited and the
Manuka Honey Appellation Society (MHAS).
Within ApiNZ, Comvita General Manager Market Access,
Tony Wright, chairs the Standards Focus Group and Comvita
General Manager Apiaries, Trevor Clarke, is a member of the
Training and Education Focus Group. Tony also represents
ApiNZ in the Industry - MPI Science Working Group. This
forum is charged with the continuous improvement of the
Manuka definition to ensure it stays in touch with the advance
of science and the definition itself remains fit for purpose.
MHAS is leading work on protecting the term ‘Manuka
honey’, and Comvita personnel have had significant input.
Through the dual approach of certification trade marks and
geographical indications, MHAS is making good progress
toward gaining the same level of naming protection as
Champagne. If successful, a product may only be called
Manuka honey if it meets the legal MPI definition and is
produced in New Zealand.
Comvita has worked with New Zealand Trade and Enterprise
and other Manuka honey brands to start developing the
New Zealand story for Manuka honey. The result will be a
marketing platform enabling growth across the New Zealand
Manuka industry as a whole, as well as allowing us to tell
our own story.
Comvita’s committed to industry-good and leading the
sector forward. We have a responsibility to do our bit and
inevitably industry-good is great for our business too.
“
“
14 15
Once the term is protected, producers can effectively add
their own story and history, and over time, the value of the
words can only increase. It will take time and effort, but in
the future Manuka honey will have the same instant consumer
reference as Scottish Whisky or Champagne.
- John Rawcliffe, UMF
®
Honey Association spokesperson
Manuka honey is a badge
of origin which says to
the consumer; ‘this honey
comes from New Zealand
and is unique and special’.

16 17
SUSTAINABILITY
FUTURE FIT, FOR GOOD
Comvita has continued to make great progress on our
sustainability journey this year by focusing on reducing
waste and energy emissions, engaging our community and
restoring our environment.
Sustainability is at the forefront of our new warehouse
extension at Paengaroa, due for completion in March 2019.
Throughout the design process, we sought out numerous
opportunities for energy efficiency, waste reduction and
rain water collection.
The new, extended warehouse at Paengaroa will:
• Be fully insulated, temperature controlled and utilise
cool, night time air during the summer to keep the
building at a desirable temperature.
• Include a 270kW photovoltaic solar system on the
roof, generating 370,000kWh of power per annum
(the average power consumption of 53 New Zealand
households).
• Allow for rain water from the roof to be stored and used
to supply a significant portion of the site’s water use.
• Be fitted with LED lights throughout (we are also taking
the opportunity to replace all lights in the existing
warehouse with LEDs, reducing onsite energy use by
25,000kW annually).
Comvita’s next steps are to build on our long-standing
commitment to sustainability, by seeking out further
opportunities across our wider business. This will allow
us to gain better visibility and reporting of our
sustainability performance.
Year two of Fruit for the Future is underway; an
initiative to provide our people with a sustainable
supply of fruit, by planting a variety of fruit trees
onsite in Paengaroa.
Fruit for the Future
In collaboration with Pacific
Coast Technical Institute,
we have co-funded the
development of a Level 3
Beekeeping Course, with
the aim of growing skills and
sharing knowledge across
the industry.
We have planted 2,100,000
Manuka seedlings throughout
New Zealand since 2016. As part
of our Manuka Plantation
Programme, carbon is
sequestered at a rate of eight
tonnes per hectare. We are
working towards planting 13,400
hectares of Manuka nationally
by 2023.
To complement our existing,
proactive sponsorship programme,
we launched a sponsorship
partnership with Hokianga Health in
FY18. This charitable Northland trust
provides free holistic healthcare
to Hokianga households via 11
clinics from Omapere to Taheke.
Manuka plantings
Supporting local communities
Knowledge sharing
In early FY18, we established a Student Internship
Programme at Head Office, 30 Comvita staff
remain actively involved in our internal mentoring
programme.
Developing our people
HEALTH AND SAFETY
IT’S FIRST, IT’S REAL AND WE OWN IT
Keeping our people healthy and safe remains a critical focus
for Comvita. Visibility of our health and safety performance
cascades from leadership dashboards through to team
performance boards. This has improved proactive incident
reporting, with no notifiable events occurring in FY18.
Our focus on creating great safety leaders has been led by
the Comvita Board and Leadership team, who strengthened
their health and safety knowledge by completing the New
Zealand Institute of Directors Health and Safety Governance
training. Our CEO joined the New Zealand Business Leaders’
Health and Safety Forum, pledging with other like-minded
leaders to improve health and safety performance, and
create a workplace where this is as important as other
business activities.
We have clear visibility of our top seven critical safety risks
and have developed critical safety risk plans to address
these. Managing risks associated with driving both on and
off road has been a priority within our apiary business.
We have improved our vehicle fleet, completed hive site risk
assessments and are better managing driver hours. Our
drug and alcohol programme is now in place across all New
Zealand and Australian operational sites.
We implemented a successful initiative within our
Australasian teams to strengthen our health and safety
maturity score, empowering them to identify, measure and
own safety improvements. From this, we were selected as a
finalist in the Engagement Category of the 2018 New Zealand
Health and Safety Awards.
During FY19, our attention will remain
on risk assessments, global health
and safety engagement, implementing
supporting technolog y and strengthening
workplace wellness initiatives.
“
“

18 19
BOARD OF DIRECTORS LEADERSHIP TEAM
NEIL CRAIG
NON-EXECUTIVE
CHAIRMAN
We have had a lot of
challenges this year, including
a potential takeover of the
business. I believe we have
emerged much stronger and
disciplined around strategic
direction as a result of this
process. I feel very confident
about our short-term
prospects.
SCOTT COULTER
CHIEF EXECUTIVE
OFFICER
I would like to say a big thanks
to the Leadership team and our
staff at Comvita. It has taken an
immense amount of effort to
move back into profitability after
weathering some tough external
events in the prior two years.
The team have done a great job.
BRETT HEWLETT
INDEPENDENT DIRECTOR
Undergoing a due diligence process
by a third party was a healthy and
timely process. It imposed on
management and Board, a discipline
of introspective review that resulted
in heightened clarity of strategy and
purpose. Focus is the key. Comvita
must leverage its early leadership
position in the world of Manuka
honey and Propolis. Success there
will result in exceptional value for
our shareholders and a sustainably
prosperous business model.
SIMON POTHECARY
CHIEF SALES OFFICER
The last 12 months have seen a
strong return to growth in our key
Asian markets, particularly cross-
border e-commerce and China.
Significant progress has been
made in establishing a footprint in
the USA which has developed into
a business of real scale. Focus on
these opportunities will continue
to deliver sales and profit growth.
MARK SADD
CHIEF COMMERCIAL
OFFICER
Commercially we have had a successful
year including the commencement
of our China JV, an extensive due
diligence process undertaken on the
Company and a strategic investment
in our Propolis supply partner based
in South America. These transactions
have created exciting opportunities and
provided key insights which will benefit
Comvita well into the future.
LUKE BUNT
INDEPENDENT DIRECTOR
It has been another difficult year for
the management team, with a second
consecutive poor honey season,
compounded by the uncertainty of
regulatory changes affecting our
industry. Despite the negative seasonal
impacts on our apiary business, our
focus on sales, productivity and
modifying our strategy inline with
environmental changes has resulted
in an encouraging improvement in
after tax operating earnings, compared
to 2017.
SARAH KENNEDY
INDEPENDENT DIRECTOR
The return to positive growth
of the Chinese cross-border
e-commerce channel is a good
start to the China JV. This,
coupled with the successful
launch into North American
Costco chain, resulted in a
pleasing increase in branded
Comvita sales of 19%.
BEN SHAW
CHIEF MARKETING
OFFICER
Over the last 12 months,
we have invested in consumer
insights, brand tracking and
packaging design. We have
increased capability internally,
and carefully selected new
agency partners, to increase
our ability to win with our
consumers in key markets
and core categories, such as
Manuka honey and Propolis.
PAUL REID
INDEPENDENT DIRECTOR
The highlight of the year for
me was improving our security of
supply through additional land
purchases and long-term leasing
arrangements with landowners.
Together with advancements
in our Manuka breeding program, we
see Manuka plantations becoming a
reality for the industry.
MURRAY DENYER
INDEPENDENT DIRECTOR
Our return to profit in FY18
was blunted by external factors,
however the fundamentals of
our business remain strong. We
have much work to do, but I am
confident we will achieve significant
and sustainable growth in the
future, based on the strategies we
are implementing on the supply
side and in our key markets.
KATE SELWAY
CHIEF PEOPLE & CULTURE
OFFICER - ACTING
Despite a challenging external
environment, our Comvita teams
have shown true resilience and
remain committed to our purpose
and Company strategy. We continue
to focus on developing a high
performing values based culture
across our diverse, global business.
COLIN BASKIN
CHIEF SUPPLY CHAIN
OFFICER
A significant development
in FY18 has been the MPI
Manuka definition. Whilst some
adjustment has been required,
this has provided our customers
with a further level of trust in
Comvita which we will build
on in FY19.
JULIANNE KEAST
CHIEF FINANCIAL OFFICER
- ACTING
In this financially challenging year,
I was impressed with the character
our people showed to identify
further sustainable savings to
ensure efficiencies in all processes
across the business. This is
enabled by an increased focus on
continuous improvement.

20 21
FINANCIAL COMMENTARY
Financial Performance
For the period ended 30 June30 June 201830 June 2017
In thousands of New Zealand dollars
Revenue178,493155,879
Cost of sales(105,298)(9 3 ,738)
Gross profit73,19562,141
Selling and marketing expenses(37,865)(3 5 , 4 8 1)
Administrative expenses(15,953)(16,955)
Distribution expenses(8,095)(5,838)
Research and development expense(3,118)(3,498)
Subtotal operating expenses(65 ,031)(61,7 72)
Other income4,93114,251
Operating profit before financing costs13,09514,620
Finance income1,7776,461
Finance expenses(4,973)(8,2 57)
Net finance costs(3,196)(1,796)
Share of profit/(loss) of equity accounted investees1,921(2,237)
Impairment of equity accounted investees(681)(1,235)
Profit before income tax11,1399,352
Income tax benefit/(expense)(2,928)470
Profit for the period8,2119,822
EQUITY
Equity has increased by $25.8m, as a result of NPAT of $8.2m
and a $17.6m increase in share capital, mostly related to
shares issued for our 51% investment in China business,
offset by dividend payments of $1.8m.
6 CENT DIVIDEND FOR FY18
The full year dividend is 6 cents per share, with 4 cents paid
at interim and a further 2 cents being paid on 28 September
2018, for shareholders on the record at 21 September 2018.
CONCLUSION
While the FY18 financial year had its challenges, we
were able to capitalise on efficiencies gained in recent
years. With this adversity came discipline and focus which
has set the Group up well for FY19 and beyond. We are
focused on working capital in the year ahead to ensure we
reduce debt levels.
FINANCIAL COMMENTARY
EQUITY ACCOUNTED INVESTEES
Net earnings from JVs totalled $1.9m (2017: loss $2.2m).
This improvement is due to the new China investment
which generated $6.6m NPAT, of which our 51% share
was $3.3m. The apiary related JVs made a loss this year,
consistent with our own apiary business. There was also
an impairment of our investment in SeaDragon of $0.7m
(2017: $1.2m).
NET DEBT, CASH FLOW AND FINANCIAL POSITION
Net debt has increased by $29.8m to $91.7m. Net outflow
on operating activities was $22.1m, of which a considerable
amount was to support inventory growth. The net investing
outflow of $7.0m included $4.8m on capex for the start of
construction of the new warehouse at Paengaroa. The Group
has continued to operate within its agreed funding covenants
and there is sufficient headroom on the bank funding facility.
Inventory has increased by 33% or $28.6m, primarily in
raw materials. This is driven by a focused view on ensuring
strong supply of UMF
®
honey. This puts the Group in a
strong position to meet its future sales opportunities. Trade
receivables increased by $11.8m to $55.8m, due to timing of
sales towards year end. The balance includes $3.9m aged
receivables related to our China investment. The shares in
Escrow related to this investment have been released post
year end, allowing the debtor to be paid.
Non-current assets increased by $18.0m, of which
investment in equity accounted investees increased by
$16.5m. This was primarily due to our investment in the
China business of $16.4m, which was by way of shares
rather than cash.
Comvita’s Net Profit After Tax (NPAT) for the year ended
30 June 2018 was $8.2m compared to the prior year of
$9.8m, while EBITDA was $20.5m compared to the prior year
of $19.8m. After tax operating earnings was a profit of $9.3m
compared to a $5.5m loss in 2017.
OPERATING PROFIT
Our revenue has grown by 15%. Revenue was $178m,
compared to $156m for the comparable year. The key
segment with sales growth was North America, increasing by
$23m with the new relationship with Costco.
Gross margin has increased slightly from 40% to 41%.
The second consecutive below average honey season has
resulted in the inability to recover the costs of our annual
harvest impacting the margin. It is expected that gross
margin will return to normalised levels in the coming year.
Operating expenses increased by 5% on the comparable
period, from $62m to $65m. Operating expenses were
36% of revenue, improving on the prior year of 39%. The
savings were achieved through dedicated efforts to remove
inefficiencies and streamline the business, which was
particularly important given the pressure on our apiary
business. Sustainable savings from FY17 were carried through
and will continue going forward.
FINANCIAL AND OTHER INCOME
Financial income of $1.8m (2017: $6.5m) primarily includes
foreign exchange gains and interest income. The comparable
year included one-offs from divesting financial assets.
Financial expenses of $5.0m (2017: $8.3m) were primarily
made up of $3.9m of interest (2017: $4.1m).
Other income of $4.9m (2017: $14.3m) was primarily from
proceeds from Integra Life Sciences Inc for a sales milestone
of $2.9m achieved this year related to the sale of intellectual
property from the Medihoney
®
brand last year. That sale
was the main component of the other income in the
comparable period.
JULIANNE KEAST
CHIEF FINANCIAL OFFICER - ACTING
Sustainable efficiency gains, focus, discipline, growth
opportunities and inventory strength to deliver in FY19
“
“

22 23
GOVERNANCE
The Board’s Charter sets out the governance principles,
authority, responsibilities, membership and operation of the
Board of Directors. This governance statement outlines the
main corporate governance practices as at 31 August 2018.
A full statement is available to view at www.comvita.co.nz.
Compliance
The best practice principles which the Company considers
in its governance approach are the New Zealand Exchange
(NZX) Listing Rules relating to corporate governance, the
NZX Corporate Governance Best Practice Code, and the
New Zealand Securities Commission Corporate Governance
Principles and Guidelines (collectively the “Principles”).
The Board’s view is that the Company’s corporate governance
principles, policies, and practices do not materially differ
from best practice ‘Principles’. The Company’s constitution,
the Board and committee charters and roles, codes and
policies referred to in this section are available to view at
www.comvita.co.nz.
Governance Principles And
Guidelines
PRINCIPLE 1 – CODE OF ETHICAL BEHAVIOUR
Directors observe and foster high ethical standards.
The Company expects its Directors, Officers, and employees
to act legally, to maintain high ethical standards, and to
act with integrity consistent with Comvita’s policies, guiding
principles and values. A Code of Ethics sets out these
standards for Directors and can be found in the Board
Charter on the Company’s website. Employees must adhere
to the Company Rules which provide clear guidance across a
range of ethical and legal matters. The Company has
adopted policies to ensure it maintains high standards
of performance and behaviour when dealing with the
Company’s customers, suppliers, shareholders and staff.
Specific policies are in place relating to the environment,
Privacy Act requirements, confidentiality of Company
information, conflicts of interest, complaints from
stakeholders, and trading in Company securities.
Mechanisms are provided for the safe reporting of
breaches of the Code or other policies or laws, and the
consequences of non-compliance are made explicit.
No breaches of the Code and policies were identified or
reported in the current year.
Trading in Comvita Securities
On a continuing basis, the Board considers whether any
matters under consideration are likely to materially influence
the present or future market expectations of the Company,
including the share value. It then determines whether or not
there continues to be an ‘open window’ for share trading by
Directors and Officers of the Company.
All proposed transactions by Directors or Officers require
specific prior approval by the Board Chair and the Chair
requires approval from the Chair of the Audit & Risk Committee.
Transactions by Directors and Officers of greater than
$100,000 require consent of the Board. Comvita has an Insider
Trading Policy which is available on the Company’s website.
The policy provides a framework that reduces the potential
for insider trading. Share trading of Directors and Officers is
monitored on a regular basis and no policy breaches have been
identified during the 2018 reporting period.
Comvita makes these documents, and other significant
governance documents listed below, available on its website:
Constitution/ChartersPolicies
ConstitutionInsider Trading Policy
Board CharterContinuous Disclosure
Policy
Remuneration & Human
Resources Committee
Charter
Audit and Risk Committee
Charter
PRINCIPLE 2 – BOARD COMPOSITION AND
PERFORMANCE
There is a balance of independence, skills, knowledge,
experience and perspective among Directors that allows
the Board to work effectively. The Directors have each signed
a commitment to work within the requirements of the
Board Charter.
Board Size and Composition
The Board is comprised of Directors with a mix of qualifications,
skills and experience appropriate to the Company’s business.
The Constitution provides for the Directors annually to elect
one of their number as Chairperson of the Board.
Gender Composition of Directors
and Officers
The Company is committed to diversity in its employment of
individuals at all levels in the organisation. As at 30 June 2018,
the Board had two female Directors in a total of seven Directors
and three female Officers (2017: two female Directors and one
female Officer). There are six women in Senior Executive roles in
the Company (2017: nine).
FINANCIAL HIGHLIGHTS
Financial Position
As at 30 June20182017
In thousands of New Zealand dollars
Assets
Property, plant and equipment47,50846,206
Biological assets4,3314,245
Intangible assets and goodwill33,39734,051
Investments in equity accounted investees30,62114,15 5
Other investments88
Deferred tax asset2,9922,149
Total non-current assets118,857100,814
Inventory116,4928 7,856
Trade receivables55,81344,013
Sundry receivables21,85115,708
Cash and cash equivalents4,9474,572
Derivatives1862,331
Tax receivable4211,398
Total current assets199,710155,878
Total a ssets318,567256,692
Equity
Issued capital137,74 4120,15 5
Retained earnings55,9554 8,701
Reserves(4,007)(4 ,9 8 1)
Total equity189,692163,875
Liabilities
Loans and borrowings96,70066,500
Employee benefits407356
Total non-current liabilities97,10766,856
Trade and other payables22,93819,088
Employee benefits4,0484,002
Tax payable1,414246
Derivatives3,3682,625
Total current liabilities31,76825,961
Total liabilities128,87592,817
Total equity and liabilities318,567256,692
The summary financial information has been derived from, and should be read in conjunction with, the Comvita Limited Group annual financial statements (the ‘ full
financial statements’). The full financial statements, approved by the Board of Directors on 20 August 2018 are available at www.comvita.co.nz. The accounting policies
used in these financial statements are included in the notes to the full financial statements. The full financial statements have been prepared in accordance with and
comply with IFRS, as appropriate for profit-orientated entities. The full financial statements have been audited by KPMG and an unqualified opinion given.
The summary financial information cannot be expected to provide as complete an understanding as provided by the full financial statements.
Cash Flows
For the period ended 30 June20182017
In thousands of New Zealand dollars
Cash inflows from operating activities180,635130,162
Cash outflows from operating activities(202,753)(140,884)
Net cash flows from operating activities(22,118)(10,72 2)
Net cash flows from investing activities(6,991)11,675
Net cash flows from financing activities29,379939
Net increase in cash and cash equivalents2701,892
Cash and cash equivalents at the beginning of the year4,5722,780
Effect of exchange rate fluctuations on cash held105(100)
Cash and cash equivalents at the end of the period4,9474,572
The primary objective of the Board is to build long-term shareholder value with
due regard to other stakeholder interests. It does this by guiding strategic direction
and context and focusing on issues critical for its successful execution.

24 25
Board MemberBoard
Conference Calls &
Special MeetingsAudit & RiskRemuneration & HR
EligibleAttendedEligibleAttendedEligibleAttendedEligibleAttended
Neil Craig101020193344
Alan Bougen*313233--
Luke Bunt1010201933-1
Murray Denyer**1082015--44
Brett Hewlett1092020--44
Sarah Kennedy1010201633--
Sarah Ottrey1092018--43
Paul Reid109201633--
* Retired from the Board 18 October 2017.
** Special leave from the Board for an extended period for health reasons.
Diversity Policy
The Company’s commitment to diversity has been reflected
in its ongoing appointments at all levels of suitably qualified
women, and others with diverse experiences and perspectives
which contribute importantly to ongoing innovation
throughout the organisation. This commitment is reflected
in the Company values and behaviours. The Remuneration
& Human Resources Committee is monitoring gender pay
equality, is positive about current progress, and has strategies
in place to achieve equality on a scheduled approach.
Takeover Protocols
The Board has established experience in respect of the
various NZX and statutory requirements in the event of a
takeover approach for the Company. The key requirements of
the Takeover Code are well understood by the Board.
Independence of Directors
For a Director to be considered to be independent, the
fundamental consideration in the opinion of the Board is that
the Director be independent of the Executive and not have
any relationship that could, or could be perceived, to interfere
materially with the Director’s exercise of his/her unfettered
and independent judgement.
Having considered these matters and the composition of
the Board, the Company considers the Directors hold an
appropriate mix of skills, expertise and independence.
The Board has reviewed which of its Directors are deemed
to be independent in terms of NZX Listing Rules and has
determined all Directors are independent. Accordingly, it is
viewed that the Chairs of the Audit & Risk, and Remuneration
& Human Resources Committees are independent, as are the
committee members.
Responsibilities of the Board and Executive
The business and affairs of the Company are managed
under the direction of the Board of Directors on behalf of
shareholders. The Board’s responsibilities are outlined on the
Company’s website www.comvita.co.nz. Responsibility for the
day-to-day operations and administration is delegated by the
Board to the Chief Executive Officer, and the Leadership team.
Appointment and Retirement of Directors
The procedure for the nomination and appointment of
Directors to the Board is set out in the Board Charter.
The Board as a whole acts as the Nominations Committee.
At each Annual Shareholders’ Meeting two of the Directors
retire by rotation and are eligible to apply for re-election,
along with any appointments made since the previous
Annual Shareholders’ Meeting. The Company does not pay
retirement benefits to any Director on retirement.
Board Processes
The Board has a regular onsite meeting schedule
complemented by teleconference meetings. There were 10
Board meetings and 20 teleconference special meetings for
the year ending 30 June 2018.
Board Composition and Performance Review
The Board regularly reviews its composition and as a result
has introduced three new Directors in the last three and a
half years. The Board Chair is not the Chief Executive Officer.
The Board initiated a performance review by external
consultants in July 2016. The procedure for assessing
Director and Board performance is set out in the Board
Charter. Board members are encouraged to participate in
learning and self-development opportunities provided by
the Institute of Directors or other professional groups.
PRINCIPLE 3 – BOARD COMMITTEES
The Board uses Committees where this enhances
the effectiveness in key areas while retaining Board
responsibility. The Board operates two Committees to assist
in the execution of the Board’s duties: the Remuneration
& Human Resources Committee and the Audit & Risk
Committee. Each Committee has a specific Charter which
can be viewed at the Company’s website www.comvita.
co.nz. Committee members are appointed from members of
the Board and membership is reviewed on an annual basis.
All matters determined by Committees are submitted to
the full Board as recommendations for Board decision. Staff
members attending those Committees are at the invitation
of the specific committee.
Remuneration & Human Resources
Committee
The Remuneration & Human Resources Committee
comprises of Murray Denyer (Chair), Sarah Ottrey (retired
13 July 2018), Neil Craig and Brett Hewlett and met four
times during the period. The Committee recommends the
remuneration policies and packages, including performance
incentives for the Chief Executive Officer and the Leadership
team. Additionally it reviews: the performance of the
Chief Executive Officer; succession planning for the Senior
Executive team and the Board; risk and compliance
monitoring in relation to the Company’s human resources
and operational health and safety oversight; the Company’s
performance in respect of responsible governance, and
remuneration policies and guidelines for Directors.
Audit & Risk Committee
The Audit & Risk Committee comprises Luke Bunt (Chair),
Sarah Kennedy, Neil Craig and Paul Reid and met three
times during the period. The Committee reviews the annual
audit process, the financial and operational information
provided to the stakeholders and others, the management
of business risk to the organisation, and the framework
of internal control and governance which the Leadership
team and the Board have established. The Chief Executive
Officer, Chief Financial Officer and General Manager Finance
regularly attend meetings. The Company’s external auditors
attend Committee meetings as deemed necessary by
the Committee.
PRINCIPLE 4 – REPORTING AND DISCLOSURE
The Board demands integrity both in financial reporting and
in the timeliness and balance of disclosure on entity affairs.
The Company is committed to ensuring integrity and
timeliness in its financial reporting and in providing
information to the market and shareholders which reflects
a considered view on the present and future prospects of
the Company.
Financial Reporting
The Audit & Risk Committee oversees the quality and
integrity of external financial reporting including the
accuracy, completeness and timeliness of financial
statements. It reviews half-year and annual financial
statements and makes recommendations to the Board
concerning accounting policies, areas of judgement,
compliance with accounting standards, stock exchange
and legal requirements, and the results of the external
audit. Management accountability for the integrity of
the Company’s financial reporting is reinforced by the
certification from the Chief Executive Officer and Chief
Financial Officer in writing that the Company’s financial
statements are fairly stated in all material aspects.
Timely and Balanced Disclosure
Continuous disclosure obligations of NZX require all listed
companies to advise the market about any material events
and developments as soon as the Company becomes aware
of them. The Company has policies and monitoring in place
to ensure that it complies with these obligations.
Non Financial Reporting
The Company has had a long commitment to reporting on
its involvement on ‘matters of sustainability’ – refer to page
16 for this years disclosure. The issue of reporting more
widely on non-financial matters is work in progress.
PRINCIPLE 5 – REMUNERATION
The remuneration of Directors and Senior Executives
is transparent, fair and reasonable. Making sure team
members and Directors get the rewards they deserve is
the responsibility of the Remuneration & Human Resources
Committee, a committee of the Board.
Non-Executive Directors Remuneration
The fees payable to the Non-Executive Directors are
determined by the Board within the aggregate amount
approved by shareholders. The Board considers external
information of peer companies in terms of scale and
complexity when setting remuneration levels. The current
Directors’ fee pool limit is $610,000 approved at the 2016
Annual Shareholders’ Meeting.
CEO Remuneration
The Chief Executive’s base salary is $440,000 per annum.
The CEO is entitled to short-term incentive rewards if (a) he
meets agreed financial, and non-financial goals used in a
balanced scorecard approach (up to 20% of base salary);
and (b) the Company exceeds a specified shareholder
earnings target (up to 20% of base salary), subject to
Board approval. The CEO is part of a long-term partly
paid executive scheme available to senior executives. This
scheme is described separately in the annual report.
Senior Executive Remuneration
Senior Executives remuneration is made up of: base or
fixed remuneration; an ‘at-risk’ component based around
individual ‘myscorecard’ performance in the year; and
a share of a bonus pool if shareholder earnings targets
are achieved, subject to Board approval. In addition, 63
executives currently participate in a partly paid executive
share scheme.
Staff Remuneration
All staff participate in a bonus pool based on the Company
attaining the agreed budget. In addition, all staff have the
opportunity to participate in a share purchase scheme -
the company provides a non-interest bearing loan of up to
$2,340 to assist staff to purchase Comvita shares.
PRINCIPLE 6 – RISK MANAGEMENT
The Board regularly verifies that the entity has appropriate
processes that identify and manage potential and relevant
risks through monthly board reporting of the Strategic Risk
Register and Operational Risk Register.
GOVERNANCEGOVERNANCE

26 27
External Auditor
Comvita’s external auditor is KPMG. KPMG was
re-appointed by shareholders at the 2017 Annual
Shareholders’ Meeting in accordance with the provisions
of the Companies Act 1993. KPMG were first appointed
as auditors in 1998. KPMG has been invited to attend this
year’s Annual Shareholders’ Meeting and will be available
to answer questions about the audit process, Comvita’s
accounting policies and the independence of the auditor.
Internal Audit
Comvita currently does not have an internal audit function.
The Audit and Risk Committee is responsible for reviewing
and monitoring the Company’s risk management and
internal control framework and has open communication
with external auditors, financial and senior management,
and the Board. The Committee is empowered to
investigate any matter brought to its attention with full
access to all books, records and facilities and personnel
of the Company and the power to retain outside counsel
or other experts for this purpose. In addition, the Board
seeks reports on specific areas of potential concern, or
to evaluate business performance on a post-investment
basis.
The reviews are completed by appropriate internal staff
and/or with external input.
PRINCIPLE 8 – SHAREHOLDER RIGHTS & RELATIONS
The Board fosters constructive relationships with
shareholders which encourages them to engage with
the Company.
The Board aims to ensure shareholders are provided
with all information necessary to assess the Company’s
strategic direction and performance. It does this through a
communication strategy which includes:
• Periodic and continuous disclosure to NZX;
• Information provided to media and briefings to major
shareholders;
• Half-year and annual reports;
• The Company’s website with an investor relations
section;
• Future direction presentation at the Annual
Shareholders’ Meeting which is conducted in a very
open manner, and a range of questions are considered.
PRINCIPLE 9 – STAKEHOLDER INTERESTS
The Board respects the interests of stakeholders within
the context of the Company’s ownership type and its
fundamental purpose. Comvita aims to manage its
business in a way that will produce positive outcomes
for all stakeholders including the public, customers,
employees, shareholders and suppliers. The Company
is strongly committed to acting in a socially responsible
manner with all stakeholders, including the wider
communit y.
NORTH AMERICA
Comvita USA Inc.
506 Chapala Street,
Santa Barbara, CA 93101
California, USA
Phone +1 855 449 2201
usacustomerservice@comvita.com
CHINA
Comvita Food (China) Limited
No.3038, Luosha Road,
Liantang Street,
Luohu District
Shenzhen, China
Phone +86 755 8366 1958
comvita@comvita.com.cn
UNITED KINGDOM
Comvita UK Limited
2nd Floor, 47a High Street
Maidenhead, SL61JT
United Kingdom
Phone +44 1628 779 460
info@comvita.co.uk
NEW ZEALAND
Comvita New Zealand Limited
23 Wilson Road South, Paengaroa
Private Bag 1, Te Puke 3153
Bay of Plenty, New Zealand
Phone +64 7 533 1426
Freephone 0800 504 959
info@comvita.com
HONG KONG
Comvita Hong Kong Limited
Room 1320 – 1322 Leighton Centre
77 Leighton Road
Causeway Bay
Hong Kong
Phone +852 2562 2335
cs@comvita.com.hk
SOUTH KOREA
Comvita Korea Co Limited
18F Gwanghwamun Building, 149
Sejong-daero, Jongno-gu,
Seoul 03186, Korea
Phone +82 2 2631 0041
service.korea@comvita.com
AUSTRALIA
Comvita Australia Pty Limited
10 Edmondstone Street
South Brisbane
Queensland 4101, Australia
Phone +61 7 3845 1400
Freephone 1800 466 392
Customer Service 1300 653 436
info@comvita.com.au
JAPAN
Comvita Japan Company Limited
Sangenjaya Horisho Bld 4F
1-12-39 Taishido, Setagaya-Ku
Tokyo 154-0004, Japan
Phone +81 3 6805 4780
info@comvita-jpn.com
DIRECTORS
COMVITA BOARD OF DIRECTORS
Neil Craig
Sarah Kennedy
Lucas (Luke) Bunt
Brett Hewlett
Paul Reid
Murray Denyer
REGISTERED OFFICE
COMVITA LIMITED
23 Wilson Road South, Paengaroa
Private Bag 1, Te Puke 3153
Bay of Plenty, New Zealand
Phone: +64 7 533 1426
Fax: +64 7 533 1118
Freephone: 0800 504 959
Email: investor-relations@comvita.com
www.comvita.com
GOVERNANCE
DIRECTORY
BANKERS
WESTPAC BANKING
CORPORATION
Tauranga Branch
27 Spring Street
PO Box 13 215
Tauranga 3141
AUDITORS
KPMG TAURANGA
Level 2
247 Cameron Road
Tauranga 3140
SOLICITORS
SHARP TUDHOPE
Level 4
152 Devonport Road
Private Bag TG12020
Tauranga 3110

SHARE REGISTRY
LINK MARKET SERVICES
LIMITED
Level 11, Deloitte Centre
80 Queen Street
PO Box 91976
Auckland 1142
Business Risks
The Chief Executive Officer and Leadership team are
required to regularly identify the major risks affecting
the business. These major risks are included in a risk
management register. Strategies are consistently being
developed to mitigate these risks. Significant risks are
discussed at each Board meeting, or as required. The
Company maintains insurance policies that it considers
adequate to meet the insurable risks of the Group.
Exposure to any foreign exchange risk is managed in
accordance with policies laid down by the Directors.
As risk assessment is a dynamic environment and often
commercially sensitive, the Company reports on the
most significant of these under its continuous disclosure
obligations to the NZX market, and in the annual report.
Health and Safety
The Company employs a General Manager - Health,
Safety & Environment and operates a Health and Safety
Committee to identify workplace hazards, and monitor
and review compliance with the Company’s documented
occupational Health and Safety policies and procedures.
Health and Safety review reports are a priority agenda
item at all Board meetings and specific reviews are
sought as required. The Board undertakes ongoing
Health and Safety education and visits key operational
sites on a scheduled basis. For further Health and Safety
disclosures, refer to page 17.
Chief Executive Officer and Chief
Financial Officer Assurance
The Chief Executive Officer and Chief Financial Officer
have provided the Board with written confirmation
that the Company’s 2018 financial statements are
founded on a sound system of risk management and
internal compliance and control; and that all such
systems are operating efficiently and effectively in all
material respects.
Risk Monitoring
The Audit & Risk Committee reviews the Company’s risk
management policies and processes and the Leadership
team provides an updated risk assessment profile
to each meeting of the Board. The Remuneration &
Human Resources Committee reviews human resource
management risks.
PRINCIPLE 7 – AUDITORS
The Board ensures the quality and independence of
the external audit process.
Independence
To ensure the independence of the Company’s external
auditor is maintained, the Board has agreed the
external auditor should not provide any services not
permitted under International Federation of Accountants
regulations. This is monitored by the Audit & Risk
Committee.

---

Comvita Financial Statements 2018 - PIComvita Financial Statements 2018 - PI
FOR THE YEAR ENDED
30 JUNE 2018
COMVITA LIMITED AND GROUP
FINANCIAL
STATEMENTS
• 2018 •

Comvita Financial Statements 2018 - PIIComvita Financial Statements 2018 - P1
DIRECTORS’ DECL A R ATION
INCOME STATEMENT
STATEMENT OF COMPREHENSIVE INCOME
STATEMENT OF CHANGES IN EQUITY
STATEMENT OF FINANCIAL POSITION
STATEMENT OF CASH FLOWS
NOTES TO THE FINANCIAL STATEMENTS
AUDIT REPORT
STATUTORY INFORM ATION
COMPA N Y DIRECTORY
2
3
4
5
6
7
8
42
46
51
CONTENTS

Comvita Financial Statements 2018 - P2Comvita Financial Statements 2018 - P3
In the opinion of the directors of Comvita Limited, the financial statements and the notes, on pages 3 to 41:
• comply with New Zealand generally accepted accounting practice and fairly reflect the financial position
of the Group as at 30 June 2018 and the results of their operations and cash flows for the year ended on
that date
• have been prepared using appropriate accounting policies, which have been consistently applied and
supported by reasonable judgements and estimates
The directors believe that proper accounting records have been kept which enable, with reasonable
accuracy, the determination of the financial position of the Group and facilitate compliance of the financial
statements with the Financial Reporting Act 2013 and the Financial Markets Conduct Act 2013.
The directors consider that they have taken adequate steps to safeguard the assets of the Group, and to
prevent and detect fraud and other irregularities. Internal control procedures are also considered to be
sufficient to provide reasonable assurance as to the integrity and reliability of the financial statements.
The directors are pleased to present the financial report, incorporating the financial statements of Comvita
Limited for the year ended 30 June 2018.
For and on behalf of the Board of Directors:
DIRECTORS’ DECL A R ATIONINCOME STATEMENT


Neil Craig Luke Bunt
20 August 2018 20 August 2018
For the year ended
In thousands of New Zealand dollars
30 June 2018

30 June 2017
Note
Revenue
5178,493
155,879
Cost of sales
(105,298)
(93,738)
Gross profit
73,195
62,141
Other income
64,931
14,251
Selling and marketing expenses
(37,865)
(35,481)
Administrative expenses
9(15,953)
(16,955)
Distribution expenses
(8,095)
(5,838)
Research and development expenses
(3,118)
(3,498)
Operating profit before financing costs
13,095
14,620
Finance income
71,777
6,461
Finance expenses
7(4,973)
(8,257)
Net finance costs
(3,196)
(1,796)
Share of profit/(loss) of equity accounted investees
151,921
(2,237)
Impairment of equity accounted investees
15(681)
(1,235)
Profit before income tax
11,139
9,352
Income tax (expense)/ benefit
10(2,928)
470
Profit for the year
8,211
9,822
Earnings per share:
Basic earnings per share (NZ cents)
2318.252 3.74
Diluted earnings per share (NZ cents)
2317.7723.08
The notes on pages 8 to 41 are an integral part of these financial statements

Comvita Financial Statements 2018 - P4Comvita Financial Statements 2018 - P5
For the year ended 30 June 2018
In thousands of New Zealand dollars
Share
capital
Foreign
currency
translation
reserve
Hedging
reserve
Retained
earningsTotal
Balance at 30 June 201697,181(3,566)(1,435)39,659131,839
Total comprehensive income for the year
Profit for the year---9,8229,822
Other comprehensive income (net of tax):
Foreign investor tax credits received---3333
Foreign currency translation differences for foreign operations-(328)--(328)
Effective portion of changes in fair value of cash flow hedges--348-348
Total other comprehensive income-(328)3483353
Total comprehensive income for the year-(328)3489,8559,875
-
Transactions with owners, recorded directly in equity
Share based payment (Note 8)---450450
Issue of ordinary shares
- executive share scheme1,735---1,735
- employee share purchase scheme42---42
Issue of treasury stock28--444472
Private Placement – China Resources21,200---21,200
Issue expenses related to the issues of shares(31)---(31)
Dividend paid (Note 22)---(1,707)(1,707)
Total transactions with owners22 ,974--(813)22 ,161
Balance at 30 June 2017120,155(3,894)(1,087)48,701163,875
Total comprehensive income for the year
Profit for the year---8,2118,211
Other comprehensive income (net of tax):
Foreign investor tax credits received---1818
Foreign currency translation differences for foreign operations-2,235--2,235
Effective portion of changes in fair value of cash flow hedges--(1,261)-(1,261)
Total other comprehensive income-2,235(1,261)18992
Total comprehensive income for the year-2,235(1,261)8,2299,203
Transactions with owners, recorded directly in equity
Share based payment (Note 8)---730730
Issue of share capital - investment in China Joint Venture (Note 15d)16,414---16,414
Issue expenses(28)---(28)
Issue of ordinary shares
- executive share scheme1,064---1,064
- employee share purchase scheme(12)---(12)
Issue of treasury stock151--140291
Dividend paid (Note 22)---(1,845)(1,845)
Total transactions with owners17,589--(975)16,614
Balance at 30 June 2018137,744(1,659)(2,348)55,955189,692
For the year ended
In thousands of New Zealand dollarsNote
30 June 2018

30 June 2017
Profit for the year
8,2119,822
Items that are or may be reclassified subsequently to the income statement
Foreign currency translation differences for foreign operations
2 ,729(361)
Effective portion of changes in fair value of cash flow hedges
(1,751)
483
Foreign investor tax credits received
18
33
Income tax on these items
10(4)
(102)
Income and expense recognised directly in other comprehensive
income
99253
Total comprehensive income for the year
9,2039,875
The notes on pages 8 to 41 are an integral part of these financial statements
STATEMENT OF
COMPREHENSIVE INCOME
STATEMENT OF
CHANGES IN EQUITY
The notes on pages 8 to 41 are an integral part of these financial statements

Comvita Financial Statements 2018 - P6Comvita Financial Statements 2018 - P7
As at 30 June

In thousands of New Zealand dollars
20182017
Note
Assets
Property, plant and equipment
12
47,50846,206
Biological assets
14
4,3314,245
Intangible assets and goodwill
13
33,39734,051
Investment in equity accounted investees
15
30,62114,15 5
Other investments88
Deferred tax asset112,9922,149
Total non-current assets118,857100,814
Inventory
17
116,4928 7,856
Trade receivables
18
55,81344,013
Sundry receivables
19
21,85115,708
Cash and cash equivalents
24
4,9474,572
Derivatives
16
1862,331
Tax receivable4211,398
Total current assets199,710155,878
Total assets318,567256,692
Equity
Issued capital13 7,74 4120,15 5
Retained earnings55,9554 8,701
Reserves
(4,007)
(4 ,9 8 1)
Total equity189,692163,875
Liabilities
Loans and borrowings
24
96,70066,500
Employee benefits
20
407356
Total non-current liabilities97,10766,856
Trade and other payables
21
22,93819,088
Employee benefits
20
4,0484,002
Ta x p ayab le1,414246
Derivatives
16
3,3682,625
Total current liabilities31,76825,961
Total liabilities128,87592,817
Total equity and liabilities318,567256,692
The notes on pages 8 to 41 are an integral part of these financial statementsThe notes on pages 8 to 41 are an integral part of these financial statements
For the year ended 30 June
In thousands of New Zealand dollars
20182017
Note
Receipts from customers
180,599129,946
Payments to suppliers and employees
(197,287)(133,219)
Interest received
36216
Interest paid
(3,850)(4,087)
Taxation paid
(1,616)(3,578)
Net cash flows from operating activities
25(22,118)(10,722)
Investment in equity accounted investees
(27)(9,539)
Net loans to/interest from equity accounted investees
(2,135)(4,158)
Receipt of dividend from equity accounted investee
262-
Net loans to/interest from related parties
(54)(788)
Payment for the purchase of property, plant and equipment
(4 ,744)(2,957)
Receipt for the disposal of property, plant and equipment
49756
Payment for the purchase of biological assets
-30
Receipt from sale of investments
-10,760
Receipt from sale of intangibles
-
19,188
Payment for the purchase of intangibles
(790)(917)
Net cash flows from investing activities
(6,991)11,675
Net proceeds from issue of share capital and issue expenses
1,02422,946
Proceeds from/repayment of loans and borrowings
30,200(20,300)
Payment of dividends
22(1,845)(1,707)
Net cash flows from financing activities
29,379939
Net increase in cash and cash equivalents
2701,892
Cash and cash equivalents at the beginning of the period
4,5722 ,780
Effect of exchange rate fluctuations on cash held
105(100)
Cash and cash equivalents at the end of the period
4,9474,572
Represented as:
Cash and cash equivalents
244,9474,572
Total
4,9474,572
STATEMENT OF
FINANCIAL POSITION
STATEMENT OF
CASH FLOWS

Comvita Financial Statements 2018 - P8Comvita Financial Statements 2018 - P9
1. REPORTING ENTITY
Comvita Limited (the “Company”) is a Company domiciled in New
Zealand, and registered under the Companies Act 1993 and listed on
the New Zealand Stock Exchange (“NZX”). The Company is an issuer
in terms of the Financial Reporting Act 2013 and Financial Markets
Conduct Act 2013. The financial statements of the Group for the
year ended 30 June 2018 comprise the Company and its subsidiaries
(together referred to as the “Group”) and the Group’s interest in
equity accounted investees.
The principal activity of the Group is that of manufacturing and
marketing quality natural health products, apiary ownership and
management.
2. BASIS OF PREPARATION
(a) Statement of compliance
The Company is a FMC reporting entity for the purposes of the
Financial Reporting Act 2013 and the Financial Market Conduct Act
2013. These Financial Statements comply with these Acts and have
been prepared in accordance with the New Zealand Equivalents to
International Financial Reporting Standards as appropriate for profit-
oriented entities.
The financial statements were approved by the Board of Directors on
20 August 2018.
(b) Basis of measurement
The financial statements have been prepared on the historical
cost basis except for derivative financial instruments, financial
instruments classified as available-for-sale and biological assets
which are measured at fair value.
The methods used to measure fair values are discussed further in the
respective notes.
(c) Functional and presentation currency
These financial statements are presented in New Zealand dollars
($), which is the Company’s functional currency. Amounts have been
rounded to the nearest thousand.
(d) Critical estimates and judgements
The preparation of the financial statements requires management
to make judgements, estimates and assumptions that affect the
application of accounting policies and the reported amounts of
assets, liabilities, income and expenses. Actual results may differ
from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised in the period
in which the estimate is revised and in any future periods affected.
In particular, information about significant areas of estimation
uncertainty and critical judgements in applying accounting policies
that have the most significant effect on the amount recognised in the
financial statements are described in the following Notes:
• Note 11 – recoverability of deferred tax assets
• Note 13 – measurement of recoverability of cash generating
units
• Note 14 – valuation of biological assets
• Note 26 – measurement of share based payments
3. SIGNIFICANT ACCOUNTING
POLICIES
(a) Basis of consolidation
(i) Business combinations
Business combinations are accounted for using the acquisition
method as at the acquisition date, which is the date on which control
is transferred to the Group.
(ii) Subsidiaries
Subsidiaries are entities controlled by the Group. Control exists
when the Group has the power to govern the financial and operating
policies of an entity so as to obtain benefits from its activities. In
assessing control, potential voting rights that presently
are exercisable are taken into account. The financial statements
of subsidiaries are included in the consolidated financial
statements from the date that control commences until the date
that control ceases.
(iii) Investments in equity accounted investees
Associates and Joint Ventures are those entities in which the Group
has significant influence, but not control, over the financial and
operating policies. Associates and Joint Ventures are accounted
for using the equity method (equity accounted investees). The
consolidated financial statements include the Group’s share of
the income and expenses of equity accounted investees, after
adjustments to align the accounting policies with those of the Group,
from the date that significant influence or joint control commences
until the date that significant influence or joint control ceases.
(b) Foreign currency
(i) Foreign currency transactions
Transactions in foreign currencies are translated to the respective
functional currencies of Group entities at exchange rates at the dates
of the transactions. Monetary assets and liabilities denominated
in foreign currencies at the reporting date are retranslated to the
functional currency at the exchange rate at that date.
(ii) Foreign operations
The assets and liabilities of foreign operations with currencies
different to the Company including goodwill and fair value
adjustments arising on acquisition, are translated to New Zealand
dollars at exchange rates at the reporting date. The income and
expenses of such foreign operations are translated to New Zealand
dollars at exchange rates at the dates of the transactions. Foreign
currency differences are recognised in the foreign currency
translation reserve (FCTR).
(c) Financial instruments
(i) Non-derivative financial instruments
Non-derivative financial instruments comprise investments in equity
securities, trade and other receivables, cash and cash equivalents,
loans and borrowings, and trade and other payables.
Non-derivative financial instruments are recognised initially at fair
value plus, for instruments not at fair value through the income
statement, any directly attributable transaction costs.
A financial instrument is recognised if the Group becomes a party
to the contractual provisions of the instrument. Financial assets
are derecognised if the Group’s contractual rights to the cash flows
from the financial assets expire or if the Group transfers the financial
asset to another party without retaining control or substantially all
risks and rewards of the asset. Regular way purchases and sales of
financial assets are accounted for at trade date, i.e., the date that the
Group commits itself to purchase or sell the asset. Financial liabilities
are derecognised if the Group’s obligations specified in the contract
expire or are discharged or cancelled.
Cash and cash equivalents comprise cash balances and demand
deposits. Bank overdrafts that are repayable on demand and form
an integral part of the Group’s cash management are included as
a component of cash and cash equivalents for the purpose of the
statement of cash flows.
Accounting for finance income and expense is discussed in Note 3(l).
Instruments at fair value through the income statement
An instrument is classified as at fair value through the income
statement if it is held for trading or is designated as such upon
initial recognition. Financial instruments are designated at fair
value through the income statement if the Group manages such
investments and makes purchase and sale decisions based on their
fair value. Upon initial recognition, attributable transaction costs
are recognised in the income statement when incurred. Subsequent
to initial recognition, financial instruments at fair value through the
income statement are measured at fair value, and changes therein are
recognised in the income statement.
(ii) Derivative financial instruments
The Group uses derivative financial instruments to hedge its exposure
to foreign exchange and interest rate risks arising from operational,
financing and investment activities. Embedded derivatives are
separated from the host contract and accounted for separately if
the economic characteristics and risks of the host contract and
the embedded derivative are not closely related. In accordance
with its treasury policy, the Group does not hold or issue derivative
financial instruments for trading purposes. However, derivatives that
do not qualify for hedge accounting are accounted for as financial
instruments designated at fair value through the income statement.
Derivative financial instruments are recognised initially at fair value
and transaction costs are expensed immediately. Subsequent to
initial recognition, derivative financial instruments are stated at fair
value. The gain or loss on remeasurement to fair value is recognised
immediately in the income statement. However, where derivatives
qualify for hedge accounting, recognition of any resultant gain or loss
depends on the nature of the hedging relationship (see over page).
Cash flow hedges
Changes in the fair value of the derivative hedging instrument
designated as a cash flow hedge are recognised in other
comprehensive income and presented in equity in the hedging
reserve to the extent that the hedge is effective. To the extent that the
hedge is ineffective, changes in fair value are recognised in the income
statement.
If the hedging instrument no longer meets the criteria for hedge
accounting, expires or is sold, terminated or exercised, then hedge
accounting is discontinued prospectively. The cumulative gain or
loss previously recognised in equity remains there until the forecast
transaction occurs. The amount recognised in equity is transferred to
the income statement in the same period that the hedged item affects
the income statement.
Separable embedded derivatives
Changes in the fair value of separable embedded derivatives are
recognised in profit or loss.
(d) Share capital
(i) Ordinary shares
Ordinary shares are classified as equity. Incremental costs directly
attributable to the issue of ordinary shares and share entitlements are
recognised as a deduction from equity.
(ii) Repurchase of share capital
When share capital recognised as equity is repurchased, the amount
of the consideration paid, including directly attributable costs, is
recognised as a deduction from equity. Repurchased shares are
classified as treasury shares and are presented as a deduction from
total equity.
(e) Property, plant and equipment
(i) Recognition and measurement
Items of property, plant and equipment are measured at cost less
accumulated depreciation and impairment losses.
Cost includes expenditures that are directly attributable to the
acquisition of the asset. The cost of self-constructed assets includes
the cost of materials and direct labour, any other costs directly
attributable to bringing the asset to a working condition for its
intended use, and the costs of dismantling and removing the items
and restoring the site on which they are located. Purchased software
that is integral to the functionality of the related equipment is
capitalised as part of that equipment.
When parts of an item of property, plant and equipment have
different useful lives, they are accounted for as separate items (major
components) of property, plant and equipment.
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

Comvita Financial Statements 2018 - P10Comvita Financial Statements 2018 - P11
(e) Property, plant and equipment (continued)
(ii) Subsequent costs
The cost of replacing part of an item of property, plant and equipment
is recognised in the carrying amount of the item if it is probable that
the future economic benefits embodied within the part will flow to the
Group and its cost can be measured reliably. The costs of the day-to-
day servicing of property, plant and equipment are recognised in the
income statement as incurred.
(iii) Depreciation
Depreciation is recognised in the income statement on a straight-line
basis over the estimated useful lives of each part of an item of property,
plant and equipment. Land is not depreciated.
The estimated useful lives for the current and comparative periods are
as follows:
• Buildings up to 50 years
• Plant and machinery 2 - 20 years
• Vehicles 4 -10 years
• Office equipment, furniture and fittings 2 -10 years
• Bearer plants 100 years
Depreciation methods, useful lives and residual values are reassessed
at the reporting date.
(f) Biological assets
Biological assets are measured at fair value less point-of-sale costs,
with any change therein recognised in the income statement. Point-of-
sale costs include all costs that would be necessary to sell the assets.
Agricultural produce from biological assets is transferred to inventory at
fair value, by reference to market prices for honey, less estimated point-
of-sale costs at the date of harvest.
(g) Intangible assets and goodwill
(i) Goodwill
Goodwill that arises on the acquisition of subsidiaries and other
business combinations is presented within intangible assets.
Goodwill is measured at cost less accumulated impairment losses.
(ii) Research and development
Expenditure on research activities, undertaken with the prospect of
gaining new scientific or technical knowledge and understanding, is
recognised in the income statement when incurred.
Development activities involve a plan or design for the production of
new or substantially improved products and processes. Development
expenditure is capitalised only if development costs can be measured
reliably, the product or process is technically and commercially feasible,
future economic benefits are probable, and the Group intends to and
has sufficient resources to complete development and to use or sell the
asset. The expenditure capitalised includes the cost of materials, direct
labour and overhead costs that are directly attributable to preparing the
asset for its intended use. Other development expenditure is recognised
in the income statement when incurred. Capitalised development
expenditure is measured at cost less accumulated amortisation and
accumulated impairment losses.
(iii) Subsequent expenditure
Subsequent expenditure is capitalised only when it increases the future
economic benefits embodied in the specific asset to which it relates.
All other expenditure, including expenditure on internally generated
goodwill and brands, is recognised in the income statement when
incurred.
(iv) Amortisation
Amortisation is recognised in the income statement on a straight-line
basis over the estimated useful lives of intangible assets, other than
goodwill, from the date that they are available for use. The estimated
useful lives for the current and comparative periods are as follows:
• Brands, patents and trademarks 3 – 20 years (2017: 3-10 years)
• Capitalised development costs 2 – 5 years
• Software 3 – 10 years
(h) Inventories
Inventories are measured at the lower of cost and net realisable value.
The cost of inventories is based on the weighted average principle,
and includes expenditure incurred in acquiring the inventories and
bringing them to their existing location and condition. In the case
of manufactured inventories and work in progress, cost includes an
appropriate share of production overheads based on normal operating
capacity. Net realisable value is the estimated selling price in the
ordinary course of business, less the estimated costs of completion and
selling expenses.
The cost of items transferred from biological assets is their fair value
less point-of-sale costs at the date of transfer.
(i) Impairment
The carrying amounts of the Group’s assets are reviewed at each
reporting date to determine whether there is any objective evidence of
impairment.
An impairment loss is recognised whenever the carrying amount of
an asset exceeds its recoverable amount. Impairment losses directly
reduce the carrying amount of assets and are recognised in the income
statement.
(i) Impairment of receivables
The recoverable amount of the Group’s investments in receivables
carried at amortised cost is calculated as the present value of
estimated future cash flows. Impairment losses on an individual basis
are determined by an evaluation of the exposures on an instrument
by instrument basis. All individual instruments that are considered
significant are subject to this approach.
For trade receivables which are not significant on an individual basis,
collective impairment is assessed on a portfolio basis based on number
of days overdue and taking into account the historical loss experience in
portfolios with a similar amount of days overdue.
(ii) Non-financial assets
An impairment loss is recognised if the carrying amount of an asset
or its cash-generating unit exceeds its recoverable amount. A cash-
generating unit is the smallest identifiable asset group that generates
cash flows that are largely independent from other assets and groups.
Impairment losses are recognised in the income statement. Impairment
losses recognised in respect of cash-generating units are allocated first
(i) Impairment (continued)
(ii) Non-financial assets (continued)
to reduce the carrying amount of any goodwill allocated to the units
and then to reduce the carrying amount of the other assets in the unit
(group of units) on a pro rata basis. When an event occurring after the
impairment was recognised causes the amount of the impairment to
decrease, the decrease in impairment loss is reversed through profit
or loss.
The recoverable amount of an asset or cash-generating unit is
the greater of its value in use and its fair value less costs to sell. In
assessing value in use, the estimated future cash flows are discounted
to their present value using a pre-tax discount rate that reflects
current market assessments of the time value of money and the risks
specific to the asset.
( j) Employee benefits
Share-based payment transactions
The grant date fair value of entitlements granted to employees
is recognised as an employee expense, with a corresponding
increase in equity, over the period in which the employees become
unconditionally entitled to the entitlements. The amount recognised
as an expense is adjusted to reflect the actual number of share
entitlements that vest.
(k) Revenue
Revenue from the sale of goods is measured at the fair value of the
consideration received or receivable, net of returns and allowances,
trade discounts and volume rebates. Revenue is recognised when the
significant risks and rewards of ownership have been transferred to
the buyer, recovery of the consideration is probable, the associated
costs and possible return of goods can be estimated reliably, and
there is no continuing management involvement with the goods.
Transfers of risks and rewards vary depending on the individual terms
of the contract of sale. For domestic sales, transfer usually occurs
when the product is received at the customer’s warehouse; however,
for some international shipments transfer occurs upon loading the
goods onto the relevant carrier.
(l) Finance income and expenses
Finance income comprises interest income on funds invested,
foreign exchange gains, dividend income and gains on the disposal of
available-for-sale financial assets that are recognised in the income
statement. Interest income is recognised as it accrues, using the
effective interest method. Dividend income is recognised on the date
that the Group’s right to receive payment is established, which in the
case of quoted securities is the ex-dividend date.
Finance expenses comprise interest expense on borrowings,
foreign exchange losses, unwinding of the discount on provisions,
impairment losses recognised on financial assets (except for trade
receivables) and losses on the disposal of available-for-sale financial
assets that are recognised in the income statement. All borrowing
costs are recognised in the income statement using the effective
interest method.
(m) Income tax expense
Income tax expense comprises current and deferred tax. Income tax
expense is recognised in the income statement except to the extent
that it relates to items recognised in other comprehensive income, in
which case it is recognised in equity.
Current tax is the expected tax payable on the taxable income for
the period, using tax rates enacted or substantively enacted at the
reporting date, and any adjustment to tax payable in respect of
previous periods.
Deferred tax is recognised in respect of temporary differences
between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for taxation purposes.
Deferred tax is not recognised for the following temporary
differences: the initial recognition of goodwill, the initial recognition of
assets or liabilities in a transaction that is not a business combination
and that affects neither accounting nor taxable profit, and differences
relating to investments in subsidiaries to the extent that they
probably will not reverse in the foreseeable future. Deferred tax is
measured at the tax rates that are expected to be applied to the
temporary differences when they reverse, based on the laws that have
been enacted or substantively enacted by the reporting date.
A deferred tax asset is recognised to the extent that it is probable
that future taxable profits will be available against which temporary
differences can be utilised. Deferred tax assets are reviewed at each
reporting date and are reduced to the extent that it is no longer
probable that the related tax benefit will be realised. Additional
income taxes that arise from the distribution of dividends are
recognised at the same time as the liability to pay the related dividend
is recognised.
(n) Earnings per share
The Group presents basic and diluted earnings per share (EPS) data
for its ordinary shares. Basic EPS is calculated by dividing the profit
or loss attributable to ordinary shareholders of the Company by the
weighted average number of ordinary shares outstanding during
the period. Diluted EPS is determined by adjusting the profit or loss
attributable to ordinary shareholders and the weighted average
number of ordinary shares outstanding for the effects of all dilutive
potential ordinary shares, which comprise share entitlements granted
to employees.
(o) Segments
Segment results that are reported to the CEO include costs
directly attributable to a segment as well as those that can be
allocated on a reasonable basis. Unallocated items comprise mainly
head office expenses.
(p) New standards and interpretations not
yet adopted
A number of new standards and interpretations are not yet effective
as at 30 June 2018, and have not been applied in preparing these
consolidated financial statements. The relevant standards are:
NZ IFRS 15 Revenue from Contracts with Customers
Effective for Group reporting period beginning on: 1 July 2018
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

Comvita Financial Statements 2018 - P12Comvita Financial Statements 2018 - P13
(p) New standards and interpretations not yet adopted
(continued)
NZ IFRS 15 deals with revenue recognition and establishes principles
for reporting useful information to users of financial statements about
the nature, amount, timing and uncertainty of revenue and cash flows
arising from an entity’s contracts with customers. Revenue is recognised
when a customer obtains control of a good or service and thus has the
ability to direct the use and obtain the benefits from the good or service.
The standard replaces NZ IAS 18 Revenue and NZ IAS 11 Construction
Contracts and related interpretations. An impact assessment of this
standard has been performed by the Group and no material impact is
expected from the adoption of this standard other than reclassifications
and additional disclosures.
NZ IFRS 9 Financial Instruments
Effective for Group reporting period beginning on: 1 July 2018
NZ IFRS 9 includes revised guidance on the classification and
measurement of financial instruments, a new expected credit loss
model for calculating impairment on financial assets, and new general
hedge accounting requirements. It also carries forward the guidance on
recognition and derecognition of financial instruments from NZ IAS 39.
NZ IFRS 9 Financial Instruments replaces the existing guidance in NZ IAS
39 Financial Instruments: Recognition and Measurement.
The new standard includes three areas of change:
1. Classification and measurement of financial instruments -
the adoption of NZ IFRS 9 will not require any changes to the
measurement of the Group’s financial assets. Financial assets
classified as ‘loans and receivables’ will now be classified as
‘amortised cost’. There are no other classification changes,
therefore no material impact is expected from this area of change.
2. A single, forward-looking, ‘expected loss’ impairment model –
the Group has elected to apply the ‘simplified approach’ for the
calculation and recognition of impairment of financial assets. An
assessment has been performed by the Group and the adoption
of this new standard is not expected to have a material impact on
the Group.
3. Reformed approach to hedge accounting. The general hedge
accounting requirements aim to simplify hedge accounting,
creating a stronger link with risk management strategy and
permitting hedge accounting to be applied to a greater variety
of hedging instruments and risks, management consider this will
have no impact on the Group. Hedging documentation has been
updated to be compliant with NZ IFRS 9.
The requirements of NZ IFRS 9 will be adopted from 1 July 2018. The
classification and measurement and impairment requirements are
applied retrospectively by adjusting the opening balance sheet at the
date of initial application, with no requirement to restate comparative
periods. The Group does not intend to restate comparatives.
The current estimated impact of transitioning to NZ IFRS 9 at 1 July 2018
on the financial statements of the Group is not expected to be material.
The Group will continue to revise, refine and validate the impairment
model and related process controls.
NZ IFRS 16 Leases
Effective for Group reporting period beginning on: 1 July 2019
NZ IFRS 16 removes the classification of leases as either operating leases
or finance leases – for the lessee – effectively treating all leases as
finance leases. Lessor accounting remains similar to current practice –
i.e. lessors continue to classify leases as finance and operating. NZ IFRS
16 Leases replaces the existing guidance in NZ IAS 17 Leases. The Group
has collated information and is in the process of assessing the full impact
of adopting this standard.
4. SEGMENT REPORTING
Segment information is presented in the financial statements in respect
of the Group’s contribution segments which are the primary basis of
decision making. The contribution segment reporting format reflects the
Group’s management and internal reporting structure.
Performance is measured based on contribution which is a measure of
profitability that the segment contributes to the Group. Contribution
is used to measure performance as management believes that such
information is most relevant in evaluating the results of certain
segments. Inter-segment pricing is determined on an arms-length basis.
Each segment sells Comvita’s range of products. Comvita’s range of
products primarily include products with apiary and other natural
ingredients.
The Company is organised primarily by geographic location of its
subsidiaries, such as New Zealand, Australia, Asia, Europe and North
Amercia, except for the China segment, which reports on sales to our
Joint Venture and our share of the Joint Venture’s profits.

The Group has six reportable segments as described below:
New Zealand This segment captures both revenue and
related costs for the New Zealand market,
excluding exports.
Australia This segment captures both revenue and
related costs for the Australian
domestic market and includes
external revenue and costs from
Comvita Australia Pty Limited.
China This segment reports on sales to our
China Joint Venture and our share of the
China Joint Venture’s profits.
Asia This segment captures both revenue and related
costs of our Asian operations and customers.
The Asian segment includes Hong Kong, Taiwan,
Japan, Korea and Singapore. It excludes China which
is a separate segment.
North America This segment captures both revenue and
related costs for sales to customers of the
North American subsidiary.
Europe This segment captures both revenue and related
costs for the United Kingdom and European markets.
4. SEGMENT REPORTING (CONTINUED)
For the year ended 30 June
In thousands of New Zealand dollars
Contribution
segments*New ZealandAustraliaChina**AsiaNorth AmericaEurope
Total reportable
segmentsOther segmentsTotal
20182017201820172018201720182017201820172018201720182017 20182017 20182017
Revenue
37,07533,11845,48331,81112,09528,64036,81332,36326,8353,8468,6647, 395166,965137,17311,52818,706178,493155,879
Contribution
16,19514,38011,5486,4671,7963,5214,1584 ,7669,060(672)4124943,16928,5115541,03343,72329,544
Non attributable
(35,559)(29,175)
Other income (Note 6)
4,93114,251
Financial income and expenses (Note 7)
(3,196)(1,796)
Share of profit of equity accounted investees (Note 15)
3,346 - (1,425)
(2,237)
1,921(2,237)
Impairment of equity accounted investees (Note 15)
(681)(1,235)(681)(1,235)
Net profit before tax5,1423,521
11,1399,352
* These are not purely geographical segments and hence vary from the geographical segments presented below
**Reconciliation of China SegmentGross51%
elimination
NoteTotal segment
(per above)
Revenue
21,423(9,328)512,095
Contribution
3,419(1,623)15b1,796
Share of profit of equity accounted investees3,346-3,346
Net profit before tax6,765(1,623)5,142
China sales and contribution for 2018 includes 51% of sales and contribution eliminated, for 51% of inventory purchased from the Group, on-hand at reporting date.
Geographical segments
30 June 2018 30 June 2017
In thousands of New Zealand dollars
RevenueNon-current assetsRevenueNon-current assets
Australia
45,70327,27031,75131,704
New Zealand
40,01648,17035,65547,312
Rest of Asia
37,1368,72233,8634,472
North America
34,966215,4782
China
12,095-28,640-
Europe
8,2161,08010,1361,012
Other Countries
361-356-
Total
178,49385,244155,87984,502

Total reportable segment assets
As at 30 June
In thousands of New Zealand dollars
2018
2017
Total assets for reportable segments
120,18197, 331
Other investments
88
Investment in equity accounted investees
30,6217,927
Other unallocated assets
167,757151,426
Consolidated total assets
318,567256,692
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS

Comvita Financial Statements 2018 - P14Comvita Financial Statements 2018 - P15
5. REVENUE
In thousands of New Zealand dollars
Note20182017
30 June30 June
Sales
186,026148,681
Elimination of sales (from stock held by equity accounted investee)4
(9,328)-
Royalties
-1,251
Deferred revenue released
-529
Deferred revenue released – Sale of IP to Derma
-3,338
Other
1,7952,080
Total revenue
178,493155,879

6. OTHER INCOME
In thousands of New Zealand dollarsNote
20182017
30 June30 June
Gain on sale of Medihoney IP to Derma
(i)-13,201
Earnout - Integra
(i)2,862-
Change in fair value of contingent consideration (ii)
750-
Government grants
764237
Gain on disposal of PP&E
125-
Change in fair value of biological assets
65428
Other
365385
Total other income
4,93114,251
(i) Sale of Medihoney Intellectual Property (IP) to Derma Sciences, Inc.
In January 2017, the Company sold its Medihoney related IP to Derma Sciences, Inc., who has been subsequently acquired by Integra Lifesciences
Inc. (NASDAQ: IART). In addition to the initial consideration received, a further two earnout payments totalling USD$5,000,000 were receivable
if Derma’s Medihoney sales exceed certain thresholds. The first earnout was received in June 2018 with a cash receipt of USD$2,000,000 for
additional consideration. The second earnout has not been recognised as a receivable as it is not virtually certain that it will be received.
(ii) Change in fair value of contingent consideration
Reversal of the contingent consideration related to the Putake Group Holdings Limited equity accounted investee, as the earnout conditions
were not met. The amount has been released from payables, refer note 21.
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS
7. FINANCIAL INCOME AND EXPENSES
In thousands of New Zealand dollars
Note20182017
30 June30 June
Gain on sale of available-for-sale financial asset (Shares – Derma)
-
4,670
Net foreign exchange gain
9361,331
Interest income
654456
Net gain in fair value of derivatives designated at fair value through
the income statement
184 -
Dividend income
34
Finance income
1,7776,461
Interest expense on financial liabilities measured at amortised cost
(3,851)(4,058)
Interest - other
-(29)
Dilution of shareholding – SeaDragon
-(623)
Net loss in fair value of derivatives designated at fair value
through the income statement:
- SeaDragon options and convertible loan notes16
(1,122)(3,501)
- Other
-(46)
Finance expense
(4,973)(8,257)
Net finance costs
(3,196)(1,796)
8. PERSONNEL EXPENSES
In thousands of New Zealand dollars
20182017
30 June30 June
Wages and salaries
37,82235,799
KiwiSaver – employer contribution
584545
Movement in long-service leave provision
511
Equity settled share based payment transactions
730450
Total personnel expenses
39,18736,795

Comvita Financial Statements 2018 - P16Comvita Financial Statements 2018 - P17
10. INCOME TAX EXPENSE IN THE INCOME STATEMENT
In thousands of New Zealand dollars
Note
2018
30 June
2017
30 June
Current tax expense
Current period
4,142500
Adjustment for prior periods
(367)(80)
Total current income tax expense
3,775420
Deferred tax expense
Origination and reversal of temporary differences
11(847)(890)
Total deferred income tax (benefit)
(847)(890)
Total income tax expense/(benefit)
2,928(470)

Reconciliation of effective tax expense
In thousands of New Zealand dollars
2018
30 June
2017
30 June
Profit for the period
8,2119,822
Total income tax expense/(benefit)
2,928(470)
Profit excluding income tax
11,1399,352
Income tax using the Company’s domestic tax rate of 28% (2017: 28%)
3,1192,619
Effect of different tax rates in foreign jurisdictions
(181)(204)
Non-deductible expenses
8923,932
Additional income
80170
Non-assessable income
(431)(7,523)
Income tax relating to equity accounted investees
(590)356
Research and development tax credits
(84)(73)
Under provided in prior periods
30346
De-recognition/(recognition) of tax losses
93(93)
Total income tax expense/(benefit)
2,928(470)
Income tax recognised directly in other comprehensive income
In thousands of New Zealand dollars
Note
2018
30 June
2017
30 June
Derivatives11
490(135)
Other items11
(494)33
Total income tax recognised directly in other comprehensive income
(4)(102)
Imputation credit account
In thousands of New Zealand dollars
2018
30 June
2017
30 June
Imputation credits available for use in subsequent reporting periods
8,0597, 478
NOTES TO THE FINANCIAL STATEMENTS
9. EXPENSES
Administrative expenses
The following items of expenditure are included in administrative expenses:
In thousands of New Zealand dollars
20182017
30 June30 June
Auditors’ remuneration:
To KPMG for audit services (ii)
256270
To KPMG for tax services (iii)
76107
To KPMG for other assurance services
-10
To Day Smith Hunter (UK auditors)
2836
Personnel expenses (i)
7,2886,911
Depreciation (i)
769839
Amortisation (i)
1,3071,654
Insurance (i)
229217
Doubtful debts (recovered)/expense
(494)252
Bad debts written off
73159
Rental expense (i)
771656
Directors’ fees (iv)
514491
Directors – other costs
174
Other legal & professional expenses
278424
Loss on disposal of property, plant & equipment
-132
Loss on disposal of intangible assets
31212
Donations
2432
(i) Only the portion of this expense which is included in administrative expenses
(ii) Audit services include fee for annual audit of the financial statements of the group and its foreign subsidiaries based in Hong Kong and Australia and the review of the interim
financial statements
(iii) Tax services is for tax compliance and advisory work
(iv) Refer to Statutory Information
NOTES TO THE FINANCIAL STATEMENTS

Comvita Financial Statements 2018 - P18Comvita Financial Statements 2018 - P19

11. DEFERRED TAX ASSETS AND LIABILITIES
Recognised deferred tax assets and liabilities
Deferred tax assets and liabilities are attributable to the following:

In thousands of New Zealand dollars
AssetsLiabilitiesNet
201820172018201720182017
Property, plant & equipment
--(1,099)(1,292)(1,099)(1,292)
Biological assets
--(584)(565)(584)(565)
Inventories
2 ,1551,821--2 ,1551,821
Derivatives
855417--855417
Investments
871910--871910
Other items
787851--787851
Tax loss carry-forwards
77--77
Tax assets/(liabilities)
4,6754,006(1,683)(1,857)2,9922,149
Set-off of tax
(1,683)(1,857)1,6831,857--
Net tax assets/(liabilities)
2,9922,149--2,9922,149
The utilisation of tax loss carry-forwards is dependent on expected future taxable profits in excess of the profits from the reversal of existing taxable
temporary differences. This recognition is based on current budgets and financial forecasts completed by management.
Movement in temporary differences during the period
2018
In thousands of New Zealand dollars
Balance
1 July 2017
Recognised
in the income
statement
Recognised
in other
comprehensive
income
Balance
30 June 2018
Property, plant & equipment
(1,292)193-(1,099)
Biological assets
(565)(19)-(584)
Derivatives
417(52)490855
Investments
910455(494)871
Inventories
1,821334-2,155
Other items
851(64)-787
Tax loss carry-forwards
7--7
Total
2,149847(4)2,992
Unrecognised deferred tax assets
Deferred tax assets have not been recognised in respect of the following items:
In thousands of New Zealand dollars
20182017
Tax loss carry-forwards
1,4852,367
Intangible assets
930900
Total
2,4153,267
The tax loss carry-forwards do not expire under current tax legislation.
NOTES TO THE FINANCIAL STATEMENTS
12. PROPERTY, PLANT & EQUIPMENT
In thousands of New Zealand dollars
LandBuildingsOwned
plant &
machinery
VehiclesBearer
Plants
Office
equipment,
furniture &
fittings
Capital
WIP
Total
Cost
Balance at 30 June 2016
9,34515,95524,5002,2135,4145,8162,51165 ,754
Additions/Transfers
6211,4681,043--652(827)2,957
Disposals
-(208)(474)(142)-(1,233)-(2,057)
Effect of movements in exchange rates
1265131(78)10(13)
Balance at 30 June 2017
9,97817,22125,0742,0725,4455,1571,69466,641
Additions/Transfers
430341,990295-1,2661,4575,472
Disposals
(160)(161)(628)(141)-(734)-(1,824)
Effect of movements in exchange rates
723976618118021575
Balance at 30 June 2018
10,32017,13326,5122,2325,6265,8693,17270,864


NOTES TO THE FINANCIAL STATEMENTS
Depreciation
Balance at 30 June 2016
-(4,078)(8,302)(1,351)(182)(3,946)-(17,859)
Depreciation
-(971)(2,292)(274)(62)(888)-(4,487)
Disposals
-130309174-1,256-1,869
Effect of movements in exchange rates
-(2)(4)(1)(1)50-42
Balance at 30 June 2017
-(4,921)(10,289)(1,452)(245)(3,528)-(20,435)
Depreciation
-(809)(2,170)(223)(65)(913)-(4,180)
Disposals
-56552133-711-1,452
Effect of movements in exchange rates
-(13)(39)(6)(8)(127)-(193)
Balance at 30 June 2018
-(5,687)(11,946)(1,548)(318)(3,857)-(23,356)
Carrying amount
At 30 June 2016
9,34511,87716,1988625,2321,8702,51147,895
At 30 June 2017
9,97812,30014,7856205,2001,6291,69446,206
At 30 June 2018
10,32011,44614,5666845,3082,0123,17247,508

Depreciation charge in the income statement
Depreciation is allocated to cost of sales, selling and marketing expenses, distribution expenses, research and development
expenses and administrative expenses.

Comvita Financial Statements 2018 - P20Comvita Financial Statements 2018 - P21
13. INTANGIBLE ASSETS AND GOODWILL
In thousands of New Zealand dollars
GoodwillBrands, patents,
trademarks
SoftwareTotal
Cost
Balance at 30 June 2016
34,02310,39312,01856,434
Additions
-7262861,012
Disposals
(5,536)(5,118)(2,559)(13,213)
Effect of movements in exchange rates
(49)-(9)(58)
Balance at 30 June 2017
28,4386,0019,73644,175
Additions
-317476793
Disposals
-(179)(311)(490)
Effect of movements in exchange rates
6641927710
Balance at 30 June 2018
29,1026,1589,92845,188
Amortisation
Balance at 30 June 2016
(626)
(7,978)(6,201)(14,805)
Amortisation
-
(443)(1,898)(2,341)
Disposals
-
4,6112,4047,015
Effect of movements in exchange rates
-
-77
Balance at 30 June 2017
(626)
(3,810)(5,688)(10,124)
Amortisation
-
(279)(1,723)(2,002)
Disposals
-
64311375
Effect of movements in exchange rates
-
(19)(21)(40)
Balance at 30 June 2018
(626)
(4,044)(7,121)(11,791)
Carrying Amount
At 30 June 2016
33,3972,4155,81741,629
At 30 June 2017
27,8122,1914,04834,051
At 30 June 2018
28,4762,1142,80733,397

Amortisation charge in the income statement
Amortisation is allocated to cost of sales, selling and marketing expenses, distribution expenses, research and development expenses and
administrative expenses.
NOTES TO THE FINANCIAL STATEMENTS
13. INTANGIBLE ASSETS AND GOODWILL (CONTINUED)
Impairment testing for cash-generating units containing goodwill (CGU)
For the purpose of impairment testing, goodwill is allocated to the Group’s CGUs which represent the lowest level within the Group at which the
goodwill is monitored for internal management purposes.
The aggregate carrying amounts of goodwill allocated to each CGU are as follows:
In thousands of New Zealand dollars
2018
30 June
2017
30 June
Australia
16,24115,717
Hong Kong
7,9247,868
United Kingdom
2,0521,968
Apiaries
1,9011,901
Other
358358
Total goodwill
28,47627,812
Value in use was determined by discounting the future cash flows generated from the continuing use of the unit and were based on the following key
assumptions:
Anticipated annual revenue growth included in the cash flow projections for the combined
CGU’s (normalised) for the years 2019 to 2023(22%) to 71%5% to 10%
Post tax discount rate
10.3%10.8%
Discount rate based on the average weighted cost of capital which was based on debt leveraging of:20%20%
- At a cost of debt rate of:
4.5%4.7%
Terminal growth rate applied beyond June 2023
3.0% 3.0%
Cash flows were projected on actual operating results and the 5-year business plan.
NOTES TO THE FINANCIAL STATEMENTS

Comvita Financial Statements 2018 - P22Comvita Financial Statements 2018 - P23
NOTES TO THE FINANCIAL STATEMENTS
13. INTANGIBLE ASSETS AND GOODWILL (CONTINUED)
Sensitivity to changes in assumptions
The recoverable amount in each CGU exceeds its carrying amount by the balances shown in the following table
In thousands of New Zealand dollars
2018
30 June
2017
30 June
Australia
9,42926,261
Hong Kong
34,43312,211
United Kingdom
3,9343,197
Apiaries
3,61834,297
If projected Earnings before Interest and Tax (EBIT) is reduced by 10% year on year, it changes the amount the recoverable
amount exceeds its carrying amount to:
In thousands of New Zealand dollars
Australia
3,60118,832
Hong Kong
29,98910,566
United Kingdom
2,8582,537
Apiaries
(631)23,632
The post tax discount rate for the recoverable amount to equal carrying amount is calculated at:
in percent
Australia
12 .1%15.7 %
Hong Kong
31.2%18.8%
United Kingdom
14.7%16.2%
Apiaries
11.0%26.6%
14. BIOLOGICAL ASSETS
Total
In thousands of New Zealand dollars
2018
30 June
2017
30 June
Bees
3,6413,578
Olive Leaf
690667
Total biological assets
4,3314,245
Bees
In thousands of New Zealand dollars
Balance at beginning of the period
3,5783,322
Decrease due to sales
(6)(31)
Net movement in operational hives
6971
Movement in fair value
-216
Balance at the end of the period
3,6413,578
Number of operational hives
Balance at beginning of the period
26,89626,577
Decrease due to sales
(41)(250)
Net movement in operational hives
524569
Balance at the end of the period
27, 37926,896
The Group is exposed to a number of risks related to owning bees, primarily the risk of damage from climatic changes and diseases. The Group has
processes in place aimed at monitoring and mitigating those risks, through hiring of experienced bee keepers, the intensive maintenance of bee hives
and disease prevention programmes.
Fair value hierarchy
The Group’s bees are level 3 on the fair value hierarchy, being calculations for which inputs are not based on observable market data
(unobservable inputs).
As the bee hives are continually regenerating the fair value assigned to a hive is on a $ per kg basis, plus queen and brood. The value attributed to
these quantities has been sourced from the Ministry of Primary Industries.
The $ value per hive assigned is highlighted in the table below
The value assigned is:
In New Zealand dollars
Average per hive
9393
Per queen
3535
Per brood
55
Total value
133133
NOTES TO THE FINANCIAL STATEMENTS

Comvita Financial Statements 2018 - P24Comvita Financial Statements 2018 - P25
NOTES TO THE FINANCIAL STATEMENTS
15. EQUITY ACCOUNTED INVESTEES (CONTINUED)
(c) Summarised financial information of material investees

As at:
SeaDragon
31-Mar-18
Comvita China
30-Jun-18
Percentage ownership interest
9.1%51%
Revenues
3,02846,038
Depreciation and amortisation
(888)(77)
Interest income
408
Interest expense
(687)-
Net profit/(loss) before tax
(6,057)8,600
Tax expense
-2,040
Net profit/(loss) after tax
(6,057)6,560
Total comprehensive income (Profit/(loss) & OCI)
(6,057)6,560
Group’s share of profit and total comprehensive income
(551)3,346
Cash and cash equivalents
1,0093,343
Total current assets
3,10539,567
Total non-current assets
11,70090
Total assets
14,80539,857
Current financial liabilities excluding trade and other payables and provisions
(2 ,758)-
Total current liabilities
(3,818)(19,813)
Non current financial liabilities excluding trade and other payables and provisions
--
Total non-current liabilities
(255)-
Total liabilities
4,073(19,813)
Net assets
10,73219,844
Group’s share of net assets
(977)10,121
Elimination of unrealised profit on downstream sales
(1,623)
Carrying amount of interest in Joint Venture
8,398
(d) Comvita China
In thousands of New Zealand dollars
2018 2017
Consideration in cash-
6,152
Consideration in shares
16,414-
Professional fees capitalised to investment
10112
Consideration from the prior year
6,264-
Carrying amount of equity accounted investee
22,6886,264
Less: Share of net tangible assets acquired
7,480-
Goodwill and intangibles
15,2086,264

Prior to 30 June 2017, the legal entity was set up and the Company contributed NZD$6,152,000 cash as share capital. Some set up costs were
incurred prior to balance date and these have been equity accounted, with the exception of legal & professional fees totalling $112,000 which
have been capitalised to the carrying value of the investment.
On 3 July 2017, the formation of the joint venture was completed. The Company issued 2,830,000 shares for consideration of $16,414,000.
These shares remain in Escrow at 30 June 2018, waiting for conditions to be met.
15. EQUITY ACCOUNTED INVESTEES
(a) Investments in Equity Accounted Investees comprises:
Country of
Incorporation
Ownership
Interest Held
Balance
Date
Principal
Activity
Extracts NZ Limited
New Zealand33.3%31 MarchNot trading
Kaimanawa Honey Limited Partnership
New Zealand50%30 JuneApiary and land use
Makino Station Limited
New Zealand50%30 JuneApiary and land ownership
SeaDragon Limited
New Zealand9.1%31 MarchFish oil production
Nga Pi Honey Limited
New Zealand33%30 JuneApiary
Putake Group Holdings Limited
New Zealand50%30 June Apiary
Manuka Research Partnership Limited
New Zealand31.77 %30 June Research and development
Medibee Pty Limited
Australia50%30 June Apiary
Comvita China, consisting of the two entities:
Comvita Food (China) Limited
China51%31 December Selling and distribution
Comvita China Limited
Hong Kong 51%31 December Selling and distribution

(b) Movement in Carrying Value of Investments in Equity Accounted Investees
In thousands of New Zealand dollars
Note20182017
Balance at 1 July 14,1556,531
Acquisitions – Comvita China
15(d)16,4246,264
Acquisitions – Other
2695,363
Profit distribution
(262)(142)
Impairment – SeaDragon
(681)(1,235)
Dilution of shareholding – SeaDragon
7-(623)
Share of profit/(loss)
1,921(2,237)
Profit elimination – Comvita China*
(1,623)-
Transfer share of loss to receivable
418234
Balance at 30 June
30,62114,155
* The profit elimination (sales less cost of sales) results from inventories sold from the Group to the equity accounted investee, still on hand at reporting date.
NOTES TO THE FINANCIAL STATEMENTS

Comvita Financial Statements 2018 - P26Comvita Financial Statements 2018 - P27
NOTES TO THE FINANCIAL STATEMENTS
15. EQUITY ACCOUNTED INVESTEES (CONTINUED)
e) SeaDragon Limited
The Company holds 410,987,830 shares (2017: 410,987,830 shares) in SeaDragon Limited.
The Convertible Notes issued to SeaDragon at 30 June 2018 total $3,000,000 (30 June 2017 $2,000,000).
There is a conversion element to the convertible note for 375,000,000 shares, which is recognised as an embedded derivative (refer to Note 16).
The options and convertible note which Comvita hold at 30 June 2018 have the ability to take the Company’s shareholding over 20%. Refer to Note 16 for
the valuation of the options and the convertible note.
f ) Apiter S.A.
Subsequent to reporting date, on 3 July 2018, the Company acquired a 20% shareholding in Apiter S.A. The consideration for this investment was
USD$5,650,000 in cash and USD$600,000 in shares, which were issued from Treasury Stock (refer Note 22).
g) Loans to equity accounted investees
In thousands of New Zealand dollars
Note2018
30 June
Loan receivable
2017
30 June
Loan receivable
2018
12 months
Interest income
2018
30 June
Interest Receivable
Kaimanawa
1,128103--
Putake
550665--
Makino
3,5483,282185290
SeaDragon - convertible note
3,0002,00036283
Medibee
2,3022,438--
Nga Pi Honey
252209--
Comvita China
10---
Total 1910,790
8,697547373
All loans to equity accounted investees are repayable on demand except convertible notes.
Medibee Apiaries Limited
Medibee Apiaries has a funding arrangement with HSBC and Comvita Limited has signed a several guarantee for its share of the facility,
which is AUD $10 million.
h) Loans to related parties
In thousands of New Zealand dollars
Gan Enterprises Ltd (Nga Pi)
567480332
Casa Base Trustees (Putake)
6035653838
Total 191,1701,0457140
NOTES TO THE FINANCIAL STATEMENTS
15. EQUITY ACCOUNTED INVESTEES (CONTINUED)
i) Transactions with equity accounted investees
In thousands of New Zealand dollars
Sale of goods and servicesPurchases of goods and service
Transaction valueBalance due fromTransaction valueBalance due from
2018
Comvita China
21,422
14,155--
Kaimanawa
2,372
5192,271-
Makino
-
-65141
Nga Pi Honey
18
1781-
Putake
25
231,149331
Medibee
-
-613-
SeaDragon
14
---
2017
Kaimanawa
1,860
2 ,139383
-
Makino -
-41
-
Nga Pi Honey-
-64
-
Putake-
-579
-
Extracts -
-18
-
16. DERIVATIVES
The table below analyses financial instruments carried at fair value, by valuation method. They are all level 2 on the fair value hierarchy, as
they include inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e., as prices)
or indirectly (i.e., derived from prices). There have been no transfers between levels in either direction during the period.
In thousands of New Zealand dollars
2018
30 June
2017
30 June
Derivatives – SeaDragon (Note 15 and table below)
21,124
Derivatives – assets (designated at fair value through the income statement)
184-
Derivatives – assets (hedging instrument)
-1,207
Total assets
1862,331
Derivatives – liabilities (hedging instrument)
(3,368)(2,625)
Total liabilities
(3,368)(2,625)
Derivatives – assets and liabilities (hedged) and designated at fair value through the income statement
The Group’s Level 2 fair values for simple over-the-counter derivative financial instruments are based on broker quotes. Those quotes are
tested for reasonableness by discounting expected future cash flows using market interest rate for a similar instrument at the measurement
date. Fair values reflect the credit risk of the instrument and include adjustments to take account of the credit risk of the Group entity and
counterparty when appropriate.

Comvita Financial Statements 2018 - P28Comvita Financial Statements 2018 - P29
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS
16. DERIVATIVES (CONTINUED)
Derivatives – designated at fair value through the income statement – SeaDragon options and convertible note
The Group determines Level 2 fair value through the application of the Binomial Model (2017: Binomial Model). Inputs include, the share price (a Level 1
input), risk free rate of the remaining life of the derivative, and the volatility of the share price.
In thousands of New Zealand dollars
Number of
shares
Strike PriceExpiry dateExpected
volatility
Risk free
rate
Value at 30
June 2018
Value at 30
June 2017
Subsequent
event (i)
Value at 8
August 2018
Options A410,987,830$0.01529-Sep-1875%2.49%-220-
Options B375,000,000$0.00828-Sep-1875%2.49%15421,623
Total -7621,623
Convertible Note
– embedded
derivative
375,000,000$0.00828-Sep-1875%2.49%13621,623
Total 21,1243,246
(i) The Deed of Amendment and Restatement signed on 3 July 2018 and approved by SeaDragon Shareholders on 8 August 2018 extends the expiry date
of the $0.008 options and Convertible Note to 31 March 2020 and adjusts the strike price to $0.0033. The value of these derivatives under the new
agreement is $3,246,000, which has resulted in a net gain in fair value of derivatives recognised in the income statement of $3,244,000 in August 2018.
17. INVENTORY
In thousands of New Zealand dollars
2018
30 June
2017
30 June
Raw materials
89,27359,895
Work in progress
2,8663,876
Finished goods
25,98024,965
Provision
(1,627)(880)
Total inventory
116,49287,856
18. TRADE RECEIVABLES
In thousands of New Zealand dollars
2018
30 June
2017
30 June
Trade receivables
55,81344,013
Total trade receivables
55,81344,013
The status of trade receivables at the reporting date is as follows:
In thousands of New Zealand dollars
Gross receivable
2018
Impairment
2018
Gross receivable
2017
Impairment
2017
Not past due
39,608-30,790-
Past due 0-30 days
5,987-4,097-
Past due 31-60 days
1,597(40)3,710(330)
Past due 61-365 days
4,834(42)5,975(229)
Past due > 365 days
3,869---
Total
55,895(82)44,572(559)
The Company has not renegotiated the terms of any financial assets which would result in the carrying amount no longer being past due or avoid a
possible past due status.
*All of the > 365 days is related to the China investment and the shares held in escrow at 30 June 2018 (Note 15d).
18. TRADE RECEIVABLES (CONTINUED)
Credit risk
The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk for trade receivables at the
reporting date by geographic region was:
In thousands of New Zealand dollars
2018
30 June
2017
30 June
China20,94322,004
Australia17, 578 8,490
New Zealand9,985 8,944
United States2,558 285
United Kingdom1,460 1,733
Hong Kong1,072 789
Other regions2,217 1,768
Total
55,81344,013
19. SUNDRY RECEIVABLES
In thousands of New Zealand dollars
Note2018
30 June
2017
30 June
Loans to equity accounted investees15(g)
10,7908,697
Loan receivable – related parties15(g)
1,1701,045
Prepayments
4,9244,171
Other receivables
4,9671,795
Total sundry receivables
21,85115,708
20. EMPLOYEE BENEFITS
In thousands of New Zealand dollars
2018
30 June
2017
30 June
Annual leave
1,6321,410
Performance accrual
1,9612,168
Accrued wages and salaries
455424
Total current employee benefits
4,0484,002
Long service leave (non-current)
407356
Total employee benefits
4,4554,358
21. TRADE AND OTHER PAYABLES
In thousands of New Zealand dollars
Note2018
30 June
2017
30 June
Trade creditors
14,4389,740
Accruals
8,4248,480
Contingent consideration – equity accounted investees6
-750
Due to directors
76118
Total trade and other payables
22,93819,088

Comvita Financial Statements 2018 - P30Comvita Financial Statements 2018 - P31
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS
22. CAPITAL AND RESERVES
Ordinary and partly paid redeemable shares
In thousands of shares
2018
30 June
2017
30 June
Note
On issue at beginning of the year
42,00539,580
Net treasury stock movement
46(41)
Share issue – Comvita China
15(d)2,830-
Private placement
-2,000
Issued to members of executive share scheme
26a282462
Issued to employee share purchase scheme
-4
Ordinary shares on issue at end of the year45,16342,005
Closing partly paid shares
26a2,0572,339
Total shares including part paid at end of the year
47, 2 2044,344
Treasury Stock
In thousands of shares
Treasury stock at beginning of the year
454413
Issued – Putake acquisition
-(163)
Supplier Partnership Group Share Scheme
(46)204
Total treasury stock at end of the year
408454
Subsequent event
Subsequent to reporting date, 154,686 Treasury Stock was issued to Apiter S.A (refer to Note 15(f )).
Ordinary shares
All ordinary shares issued are fully paid and have no par value. The holders of ordinary shares are entitled to receive dividends as
declared from time to time and are entitled to one vote per share at meetings of the Company. All shares rank equally with regard to the
Company’s residual assets.
Translation reserve
The translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign operations.
Hedging reserve
The hedging reserve comprises the cumulative change in the fair value of cash flow hedging instruments related to hedged transactions that
have not yet occurred.
22. CAPITAL AND RESERVES (CONTINUED)
Dividends
The following dividends were declared and paid by the Group:
In thousands of New Zealand dollars
20182017
$0.04 per ordinary share in March 2018
1,845 -
$0.02 per ordinary share in March 2017
-882
$0.02 per ordinary share in September 2016
-825
Total
1,8451,707
Capital management
The Group’s capital includes share capital, reserves and retained earnings. The Board’s policy is to maintain a strong capital base so as to maintain
investor, creditor and market confidence and to sustain future development of the business. The Board of Directors monitors the geographic spread of
shareholders, as well as the return on capital.
Public share offerings and private offerings are made, where applicable. This and acquisitions are key to ensuring the future development of the business.
The Board has an employee share purchase scheme and an executive employee share scheme to ensure the employees hold an investment in the Group.
The Board has also implemented a Supplier Group Share Scheme to assist in security of raw material honey supply.
Other than the banking requirements, neither the Company nor any of its subsidiaries are subject to externally imposed capital requirements.
23. EARNINGS PER SHARE
Basic earnings per share - weighted average number of ordinary shares
In thousands of shares
2018
30 June
2017
30 June
Issued ordinary shares at beginning of year
42,00539,581
Effect of shares issued during the year
2,9761,792
Weighted average number of ordinary shares at the end of the year
44,98141,373
Basic earnings per share (NZ cents)
18.252 3.74
Diluted earnings per share - weighted average number of ordinary shares (diluted)
In thousands of shares
Weighted average number of ordinary shares (basic)
44,98141,373
Effect of share entitlements issued
1,2151182
Weighted average number of diluted shares at end of the year
46,19642,555
Diluted earnings per share (NZ cents)
17.7723.08

Comvita Financial Statements 2018 - P32Comvita Financial Statements 2018 - P33
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS
24. LOANS AND BORROWINGS
This note provides information about the contractual terms of the Group’s interest-bearing loans and borrowings.
Terms and debt repayment schedule
In thousands of New Zealand dollars
Facility Local
Currency
CurrencyNominal
Interest rate
MaturityCarrying
Amount
Carrying
Amount
20182017
Secured bank loan – Westpac NZ
44,000NZD3.65%Sept 202044,00044,000
Multi option credit line – Westpac NZ
66,300NZD3.34%Feb 202052 ,70022,500
Total borrowings
110,30096,70066,500
Less current portion of borrowings
--
Borrowings – Non current
96,70066,500
Subsequent event
Borrowings facility increased from $110.3 million to $130.3 million in August 2018.
Covenants and security
The Group was in compliance with all banking covenants during the year and as at 30 June 2018. All debt with Westpac New Zealand Limited is
secured by way of registered first and exclusive Composite Debentures and a General Security Agreement, cross collateralised, over all the assets,
undertakings and uncalled capital of all Charging Group companies and an interlocking supported guarantee between all Charging Group companies.
“Charging Group” - Comvita Limited, Comvita New Zealand Limited, Comvita Holdings Pty Limited, Comvita Australia Pty Limited, Comvita Holdings
UK Limited and Comvita UK Limited.
Net debt
In thousands of New Zealand dollars
2018
30 June
2017
30 June
Cash
4,9474,572
Less Debt – Non-Current
(96,700) (66,500)
Net Debt
(91,753)(61,928)
Interest rate risk
At reporting date the interest rate profile of the Group’s interest-bearing financial instruments is the balances of the loans above. The Group has a
policy of ensuring that its exposure to interest rates for borrowings is managed. Interest rate swaps have been entered into to achieve an appropriate
mix of fixed and floating rate exposure with the Group’s policy.
Sensitivity analysis
In managing interest rate risks the Group aims to reduce the impact of short-term fluctuations on the Group’s earnings. Over the longer-term,
however, permanent changes in interest rates will have an impact on profit. At 30 June 2018 it is estimated that a general increase of one percentage
point in interest rates would decrease the Group’s profit before income tax by approximately $405,000 (2017: $225,000).
Other Facilities
Overdraft schedule
In thousands of New Zealand dollars
Facility Local CurrencyCurrencyInterest rateInterest rate
20182017
Overdraft facility NZD – Westpac NZ
750NZD9.64%9.39%
Overdraft facility GBP – Westpac NZ
1,650GBP9.64%9.39%
Overdraft facility YEN – Westpac NZ
500JPY9.64%9.39%
The balance drawn on each of these at 30 June 2018 is nil (2017: nil).
25. RECONCILIATION OF THE PROFIT FOR THE PERIOD WITH THE NET CASH FROM
OPERATING ACTIVITIES
In thousands of New Zealand dollars
Note
20182017
Profit for the year
8,2119,822
Adjustments for:
Depreciation
124,1804,487
Amortisation
132,0022,341
(Gain)/loss on disposal of property, plant & equipment
(125)132
Loss on disposal and impairment of intangible assets
31212
Share based payments
8730450
Release of deferred revenue
5-(3,867)
Fair value (gain)/loss in biological assets
6(65)(428)
Net loss/(gain) on fair value of derivatives – SeaDragon options
71,1223,501
Dilution of shareholding – SeaDragon investment
7-623
Interest income from investing activities
(618)-
Net (loss)/gain on fair value of derivatives
7(184)48
Gain from sale of Medihoney IP
6-(13,201)
Gain from sale of Derma shares
7-(4,670)
Elimination of equity accounted investees – stock profit
15(b)1,623-
Share of (profit)/loss equity accounted investees
15(b)(1,921)2,237
Impairment – equity accounted associates
15(b)6811,235
Change in fair value of contingent consideration
6(750)-
Other
84-
Profit adjusted for non-cash items
15,0012,922
Change in trade payables relating to investing activities
2526
Changes in sundry receivables related to shares
291(1, 474)
Change in sundry receivables related to investing activities
2,2184 ,729
Change in working capital items from foreign currency translation reserve
970(243)
Foreign investor tax credits
1833
Change in inventories
(28,636)7, 443
Change in trade receivables
(11,800)(25,221)
Change in sundry debtors and prepayments
(6,143)(3,693)
Change in trade and other payables
3,8507,563
Change in employee benefits
961,255
Change in tax payable
2,145(3,172)
Change in deferred tax liability
(843)(788)
Movement of deferred tax in equity
490(102)
Foreign currency reserve
200-
Net cash from operating activities
(22,118)(10,722)

Comvita Financial Statements 2018 - P34Comvita Financial Statements 2018 - P35
NOTES TO THE FINANCIAL STATEMENTS
26. EMPLOYEE SHARE SCHEMES
(a) Executive share scheme
Comvita Limited has an Executive Employee Share Scheme called the Comvita Limited Partly Paid Share Scheme (“The Scheme”).
The Scheme is designed to provide key employees with an opportunity to benefit from share price growth. A summary of the key
points of the Scheme are as follows:
• Comvita will periodically offer the rights to acquire a certain number of ordinary shares to key employees. The issue price of the shares will be
at fair value.
• When the offer is accepted Comvita will issue the shares to the Scheme Trustee (Comvita Share Scheme Trustee Limited, which is a subsidiary
Company) who will hold the shares on the employees behalf.
• The employee will pay 1 cent for each share at issue date. The partly paid shares will carry entitlements to voting rights, dividend rights and
rights to share in surplus assets of Comvita to the extent that they are paid up.
• The release of shares are subject to a share price hurdle threshold being met as described in the Scheme and certain vesting conditions,
primarily ongoing service to the Group, and insider trading legislation and other applicable laws.
• On transfer the employee has to pay up the balance of the released shares. If the share price hurdle applicable to any shares is not met on
or before each of their respective anniversary dates, the employee will not be able to pay up the balance of the released shares and they will
receive back the initial payment for those shares not released and the associated shares are forfeited.
Entitlements on issue at
In thousands
30 June 201830 June 2017
Number of
entitlements
Weighted average
exercise price
Number of
entitlements
Weighted average
exercise price
Entitlements outstanding at beginning of year
2,3397. 201,5314 .71
Entitlements granted during the year
--1,3848.77
Entitlements forfeited during the year
--(114)6.71
Entitlements converted to ordinary shares (Note 22)
(282)3.78(462)3.74
Entitlements outstanding at end of year
2,0577.672,3397. 20
There are 63 (2017: 64) employees in the scheme. The number of entitlements at 30 June 2018 is 4.3% (30 June 2017: 5.2%) of total shares
Fair Value of Share rights granted
The Group’s share based payments are level 2 on the fair value hierarchy, involving a combination of quoted (the Company’s share price) and
unquoted prices. The fair value of services received in return for share entitlements granted to employees is measured by reference to the fair value
of shares. The estimate of the fair value of the services received is measured based on a Monte Carlo simulation model.
Measurement inputs include share price on measurement date, exercise price of the instrument, expected volatility (based on weighted average
historic volatility adjusted for changes expected due to publicly available information), weighted average expected life of the instruments (based
on historical experience and general option holder behaviour), expected dividends, and the risk-free interest rate (based on government bonds).
Service and non-market performance conditions attached to the transactions are not taken into account in determining fair value.
NOTES TO THE FINANCIAL STATEMENTS
26. EXECUTIVE SHARE SCHEME (CONTINUED)
(a) Executive share scheme (continued)
Fair value of share entitlements and assumptions
Issue Date 5-Sep-1417-Aug-1518-Nov-1530-Sep-201630-Jun-2017
Entitlements issued (number)
772,500544,000208,750801,250582,500
Entitlements on hand (at 30 June 2018)
148,125371,500188,750766,250582,500
Fair value at measurement date
$0.59$0.95$1.21$1.26$1.59
Share price at grant date
$3.65$5.75$8.18$11.30$5.80
Grant date
5-Sep-1417-Aug-1518-Nov-1530-Sep-201630-Jun-2017
Exercise price
$3.67$5.45$7.77$11.08$5.60
Expected price volatility
35.3%27.0%25.8%23.7 %52.6%
Share life (weighted average life of each tranche)
2-4 years2-4 years2-4 years2-4 years2-4 years
Expected dividend yield
4.20%2 .78%2.26%2 .73%3.26%
Risk-free interest rate
4.09%2.69%2.57%1.87%1.81%

The expected volatility is based on analysing the historic volatility (calculated based on the weighted average remaining life of the share
entitlements), adjusted for any expected changes to future volatility due to publicly available information. Share entitlements are granted
under a service condition. Such conditions are not taken into account in the grant date fair value measurement of the services received.
The grants in relation to key management personnel also contain a market condition relating to a share price hurdle. This condition has
been taken into account in the grant date fair value measurement of the services received.
Movement of entitlements on issue
Movements in the number of shares outstanding under the scheme are as below:
Year ended 30 June 2018
In thousands
Grant dateExpiry date
Exercise
price
Forecast
share price
hurdle at
30 June
2018*
Balance at
start of yearGranted
Exercised
during year
Rolled to next
anniversary
Balance
at end of
the year
(number)
25-Jul-1325-Jul-173.90 134 -(134)- -
05-Sep-1405-Sep-173.67 148 -(148) - -
05-Sep-1405-Sep-183.674.95 148 -- - 148
17-Aug-1517-Aug-175.45 186 -- (186) -
17-Aug-1517-Aug-185.457.11 93 --186 279
17-Aug-15
17-Aug-195.457.81 93 -- - 93
18-Nov-15
18-Nov-177.77 94 -- (94) -
18-Nov-15
18-Nov-187.7710.26 47 --94 142
18-Nov-15
18-Nov-197.7711.18 47 -- - 47
30-Sep-16
30-Sep-1811.0813.53 383 --- 383
30-Sep-16
30-Sep-1911.0814.81 191 - -- 191
30-Sep-1630-Sep-2011.0816.22 192 - -- 192
30-Jun-1730-Jun-195.606.76 291 - -- 291
30-Jun-1730-Jun-205.607. 31 146 - -- 146
30-Jun-1730-Jun-215.607.91146 - -- 146
Total 2,339 - (282)- 2,057
There are no entitlements exercisable at the end of the year.
* The forecast share price hurdle calculation can change based on the WACC percentage used and future dividends paid.

Comvita Financial Statements 2018 - P36Comvita Financial Statements 2018 - P37
NOTES TO THE FINANCIAL STATEMENTS
26. EXECUTIVE SHARE SCHEME (CONTINUED)
(b) Staff share scheme
Employees who have served continuously with the Company for a period of at least 12 months, are given the opportunity to subscribe for ordinary
shares in the Company from time to time. An interest free loan is advanced by the Company not exceeding $2,340, repayable over three years.
20182017
Employees in the scheme
6581
Number of shares held
23,64634,063
% of share capital
0.05%0.08%
27. FINANCIAL INSTRUMENTS
Overview
Exposure to credit, liquidity and market risks arises in the normal course of the Company’s business.
This note presents information about the Group’s exposure to each of the above risks, the Group’s objectives, policies and processes for
measuring and managing risk and the Group’s management of capital. Further quantitative disclosures are included throughout these financial
statements.
The Board of Directors has overall responsibility for the establishment and oversight of the Group’s risk management framework. The Audit and Risk
Committee is designated to develop and monitor the Group’s risk management policies. The committee reports regularly to the Board of Directors
on its activities.
The Group’s risk management policies are established to identify and analyse the risks faced by the Group, to set appropriate risk limits and controls,
and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions
and the Group’s activities. The Group through its training and management standards and processes aims to develop a disciplined and constructive
control environment in which all employees understand their roles and obligations.
Credit risk
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and
arises principally from the Group’s receivables from customers. As the counterparty of financial instruments is Westpac New Zealand Limited, it is
considered there is minimal credit risk.
The majority of revenue is generated from retailers and consumers and there is no geographical concentration of credit risk. In order to determine
which customers are classified as having payment difficulties, the Group applies a mix of duration and frequency of default. Trade receivables
aging are monitored on a monthly basis and the Company does not require collateral in respect of trade and other receivables, however Personal
Guarantees are obtained where the Company considers it is appropriate.
The Board has approved a credit policy under which new customers are analysed individually for credit worthiness before the Group’s standard
payment terms and conditions are offered. The Group’s review includes reviewing references. Customers that fail to meet the Group’s benchmark
creditworthiness may transact with the Group only on a prepayment basis.
Where possible, our interest in goods sold are subject to retention of title clauses and a security interest is registered on the Personal Property
Securities Register (PPSR), so that in the event of non-payment the Group may have a secured claim.
The Group’s policy is to provide financial guarantees only to subsidiaries and equity accounted investees.
Liquidity risk
Liquidity risk represents the Group’s ability to meet its financial obligations as they fall due. The Group’s approach to managing liquidity is to ensure
that it will have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses
or risking damage to the Group’s reputation.
Due to the seasonal nature of raw materials supply the Group has credit lines in place to cover timing differences to offset the mismatch of receipts
and payments. The borrowings are by way of overdraft and committed credit facilities.
NOTES TO THE FINANCIAL STATEMENTS
27. FINANCIAL INSTRUMENTS (CONTINUED)
Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Group’s income or the
value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable
parameters while optimising return on risk. The Group buys and sells derivatives, and also incurs financial liabilities in order to manage market risks. All
transactions are carried out within the Treasury Policy guidelines set by the Board of Directors. Generally the Group seeks to apply hedge accounting in
order to manage volatility in the income statement.
Currency risk
The Group is exposed to currency risk on sales that are denominated in a currency other than its functional currency, the New Zealand Dollar.
The currencies in which transactions are primarily denominated are United States Dollars, Japanese Yen, Australian Dollars, Hong Kong Dollars and
British Pounds.
The Group hedges are based on net foreign currency receipts. At any point in time the Group hedges between 50% to 100% of its estimated foreign
currency exposure in respect of net cash receipts expected to be received over the following 12 months. The Group uses a mixture of forward exchange
contracts, collars and options to hedge its currency risk, most with a maturity of less than one year from the reporting date. When necessary, forward
exchange contracts are rolled over at maturity.
Liquidity risk
The following table sets out the contractual maturities of financial liabilities including interest payments and derivatives:
In thousands of New Zealand dollars
Stmt of
financial
position
Contractual
cash flows
6 months
or less
6-12
months
1-2 years2-5 years5-10 years
Non-derivative financial liabilities
2018
Secured bank loans
(96,700)(103,174)(1,662)(1,662)(55,449)(44,402)-
Trade and other payables
(22,938)(22,938)(22,938)- - --
Total non-derivative liabilities
(119,638)(126,112)(24,600)(1,662)(55,449)(44,402)-
Derivatives
Inflow
18442,24331,0019,96156861894
Outflow
(3,368)(46,306)(32,338)(10,800)(1,384)(1,546)(237)
Total
(3,184)(4,063)(1,337)(839)(816)(928)(143)
2017
Secured bank loans
(66,500)(69,364)(1,146)(1,146)(67,073)--
Trade and other payables
(19,088)(19,088)(19,088)----
Total non-derivative liabilities
(85,588)(88,442)(20,234)(1,146)(67,073)--
Derivatives
Inflow
1,024 23,358 12,110 8,512 786 1,562 389
Outflow
(2,625)(26,824)(12,066)(8,701)(1,919)(3,607)(532)
Total
(1,601)(3,467) 44(189)(1,133)(2,045)(143)

Comvita Financial Statements 2018 - P38Comvita Financial Statements 2018 - P39
NOTES TO THE FINANCIAL STATEMENTS
27. FINANCIAL INSTRUMENTS (CONTINUED)
Currency risk
In thousands of New Zealand dollars
Group
2018AUDGBPHKDUSDOther
Trade receivables
17, 5781,4601,0722,5582,216
Trade and other payables
(2,298)(851)(667)(1,210)(412)
Gross balance sheet exposure
15,2806094051,3481,804
Forward exchange contracts (local currency)
7, 4951,77530,50014,100
2017
Trade receivables
8,5141,7397642,198293
Trade and other payables
(1,728)(36)(63)(192)(109)
Gross balance sheet exposure
6,7861,7037012,006184
Forward exchange contracts (local currency)
9,7801,26018,9501,722
Sensitivity analysis
A 20 percent strengthening and 20% weakening of the NZD against the following currencies at 30 June would have changed the asset or liability
values in the statement of financial position at 30 June through a change in equity and the income statement by the amounts shown below. This
analysis assumes that all other variables, in particular interest rates, remain constant. The analysis for 2018 assumes a 20 percent (30 June 2017: 20
percent) strengthening and weakening of the NZD.
2018201820172017
EquityIncome statementEquityIncome statement
+20%
-20%+20%-20%+20%-20%+20%-20%
AUD
1,361(2,042)--1,701(2,552)--
GBP
582(875)--376(566)--
USD
996(1,494)--391(587)--
HKD
951(1,428)--554(833)
--
JPY
526(793)--86(130)
--
Classification and Fair Values
The carrying amount of all assets and liabilities reflects the fair value. They are classified as follows:
Classification Asset or liability
Designated at fair value Derivatives
Available for sale Other investments
Loans & receivables Trade and other receivables, Cash and cash equivalents
Other liabilities & amortised cost Loans and borrowings, Trade and other payables
NOTES TO THE FINANCIAL STATEMENTS
28. RELATED PARTIES
Transactions with key management personnel
The key management personnel consist of the Leadership team of Comvita.
Key management and director compensation comprised:
In thousands of New Zealand dollars
20182017
Note
Director fees
9514491
Short term employee benefits
2,6252,005
KiwiSaver employer contribution
4945
Share based payments
403231
Total
3,5912 ,772

Other transactions with key management personnel
At 30 June 2018 Directors and other key management personnel of the Company control 5.70% (2017: 9.80%) of the voting shares of the Company.
Other related party transactions
Brett Hewlett received $10,000 in consulting fees for his representation of Comvita on the board of SeaDragon during part of the 2018 financial year
(2017: $153,000 SeaDragon and Derma Sciences).

Other transactions
Craigs Investment Partners Limited are considered to be a related party as Neil Craig is Chairman of both entities. Craigs Investment Partners Limited
manage the Comvita share purchase program (START Scheme) and facilitated the sale of shares in the Executive Share Scheme (refer Note 26) for
some employees. During the year fees paid to Craigs Investment Partners Limited, recognised in other expenses for mainly secretarial services and
custodial fees for securities held in Escrow were $41,000 (2017: $35,500) and balance due at 30 June of $1,800 (2017: $7,500).

Comvita Financial Statements 2018 - P40Comvita Financial Statements 2018 - P41
NOTES TO THE FINANCIAL STATEMENTSNOTES TO THE FINANCIAL STATEMENTS
28. RELATED PARTIES (CONTINUED)

Subsidiaries
Country of
Incorporation
Ownership
Interest Held
Balance
Date
Principal Activity
Comvita New Zealand LimitedNew Zealand100%30 June
Manufacturing and marketing
Medibee LimitedNew Zealand100%30 JuneNot trading
Comvita Taiwan LimitedNew Zealand100%30 JuneSales activities
Bee & Herbal New Zealand LimitedNew Zealand100%30 JuneIP ownership
Apimed Medical Honey LimitedNew Zealand100%30 JuneIP ownership
Comvita Landowner Share Scheme Trustee
Limited
New Zealand100%30 JuneApicultural land owner share
scheme
Kiwi Bee Medical Limited New Zealand100%30 JuneApiary and medical honey
extraction
Jonno Developments LimitedNew Zealand100%30 JuneResearch and development
Kyoto Forests of New Zealand LimitedNew Zealand100% 30 JuneNot trading
Comvita Share Scheme Trustee LimitedNew ZealandManagement
control
30 JuneExecutive employee share scheme
Comvita Innovation LimitedNew Zealand100%30 JuneNot trading
Comvita USA, Inc USA100%30 JuneSelling and distribution
Comvita Japan Company LimitedJapan100%30 JuneSelling and distribution
Comvita Korea Co Limited Korea100%30 JuneSelling and distribution
Comvita Holdings HK LimitedHong Kong100%30 JuneHolding Company
Greenlife (New Zealand) Product Limited Hong Kong100%30 JuneNot trading
Comvita HK LimitedHong Kong100%30 JuneSelling and distribution
Comvita Holdings Pty LimitedAustralia100%30 JuneHolding Company
Comvita Australia Pty Limited Australia100%30 JuneManufacturing, selling &
distribution
Olive Leaf Australia Pty LimitedAustralia100% 30 JuneNot trading
Olive Products Australia Pty Limited Australia100%30 JuneProperty ownership
Comvita IP Pty LimitedAustralia100%30 JuneIP ownership
Comvita Health Pty LimitedAustralia100%30 JuneNot trading
Medihoney Pty LimitedAustralia100%30 JuneNot trading
Medihoney (Europe) LimitedUnited Kingdom100%30 JuneNot trading
Comvita Holdings UK LimitedUnited Kingdom100%30 JuneHolding Company
Comvita UK LimitedUnited Kingdom100%30 JuneSelling and distribution
New Zealand Natural Foods LimitedUnited Kingdom100%30 JuneNot trading
29. COMMITMENTS
Operating leases as lessee
Non-cancellable operating lease rentals are payable as follows:
In thousands of New Zealand dollars
2018
30 June
2017
30 June
Less than 1 year
4,650
4,640
Between one and five years
3,986
3,354
Greater than five years
15
-
Total
8,6517,994
Operating lease expense in the income statement
4,1803,803
The Group leases a number of warehouses, retail stores and administration premises and vehicles under operating leases. The leases are typically
between 1 and 10 years. A number of the leases have options to renew the leases after that period. The Group has a number of short term land use
agreements for hive placements.
Capital commitments
The total capital commitment is $6,944,000 (2017: $261,000) and will be paid over the next 12 months. The capital commitment includes
construction of the new warehouse at Paengaroa.
30. SUBSEQUENT EVENTS
On 20 August 2018, the Directors approved the payment of a fully imputed final dividend of $911,200 (2 cents per share) to be paid on 28 September
2018. As the dividend was declared after balance date it has not been recognised a liability in these financial statements.
Subsequent events have been disclosed in the following notes:
- Equity accounted investees. refer to Note 15(f ) and 22;
- Bank borrowings, refer to Note 24; and
- Derivatives, refer to Note 16.

Comvita Financial Statements 2018 - P42Comvita Financial Statements 2018 - P43
Independent auditor’s report
To the shareholders of Comvita Limited
Report on the consolidated financial statements
Opinion
In our opinion, the accompanying consolidated
financial statements of Comvita Limited (the
Company) and its subsidiaries (the Group) on
pages 3 to 41:
i. Present fairly in all material respects the Group’s
financial position as at 30 June 2018 and its
financial performance and cash flows for the
year ended on that date; and
ii. Comply with New Zealand Equivalents to
International Financial Reporting Standards and
International Financial Reporting Standards.
We have audited the accompanying
consolidated financial statements which
comprise:
— The consolidated statement of financial
position as at 30 June 2018;
— The consolidated income statement,
consolidated statements of comprehensive
income, changes in equity and cash flows for
the year then ended; and
— Notes, including a summary of significant
accounting policies and other explanatory
information.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (New Zealand) (‘ISAs (NZ)’).
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
We are independent of the Group in accordance with Professional and Ethical Standard 1 (Revised) Code
of Ethics for Assurance Practitioners issued by the New Zealand Auditing and Assurance Standards Board
and the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants
(IESBA Code), and we have fulfilled our other ethical responsibilities in accordance with these requirements
and the IESBA Code.
Our responsibilities under ISAs (NZ) are further described in the auditor’s responsibilities for the audit of the
consolidated financial statements section of our report.
Our firm has also provided other services to the Group in relation to taxation services. Subject to certain
restrictions, partners and employees of our firm may also deal with the Group on normal terms within the
ordinary course of trading activities of the business of the Group. These matters have not impaired our
independence as auditor of the Group. The firm has no other relationship with, or interest in, the Group.

Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the consolidated financial statements in the current period. We summarise below those
matters and our key audit procedures to address those matters in order that the Shareholders as a
body may better understand the process by which we arrived at our audit opinion. Our procedures were
undertaken in the context of and solely for the purpose of our statutory audit opinion on the consolidated
financial statements as a whole and we do not express discrete opinions on separate elements of the
consolidated financial statements.
Independent auditor’s report
To the shareholders of Comvita Limited
Report on the consolidated financial statements
The key audit matter
Carrying value of goodwill
Refer to Note 13 to the financial statements.
The Group has $28.5m of goodwill arising from previous
acquisitions, contained within 5 cash generating units (CGUs).
Specific focus was given to the Australia, Apiaries and United
Kingdom CGU in light of performance in FY18 and the extent of
goodwill for these CGUs.
Valuation of goodwill is considered to be a key audit matter
due to the significance of the asset and the value in use models
used in the assessment of impairment including a range of
judgemental assumptions about future performance. Particular
attention was required of:
• The strategic direction of the Group;
• The future cash flows;
• Terminal growth rates; and
• The discount rate applied to those cash flows.
A key audit matter for us was whether the Group’s value in use
models for impairment included appropriate consideration of
these factors on their significant estimates and judgements and
the selection of key external and internal inputs.
How the matter was addressed in our audit
Our approach included the following procedures, amongst
others:
— Assessed the Group’s determination of CGUs based on
our understanding of the nature of the Group and their
operations, and assessed whether this was consistent with
the internal reporting of the business;
— Assessed the value in use models and whether they are in
accordance with the requirements of NZ IAS 36;
— Evaluated the appropriateness of key assumptions including
terminal growth rates applied and their impact on estimated
future cash flows;
— Involved valuation specialists to challenge key judgements,
which included weighted average cost of capital applied;
— Agreed inputs used by the Group in their models to assess
impairment to Board approved budgets and strategic plans;
and compared these with historical actual results. We also
considered the accuracy of previous internal forecasts;
— Performed sensitivity analysis on key cash flow forecast
assumptions, including EBITDA, WACC, terminal growth
and capital expenditure levels, to understand the impact of
reasonably possible changes in key assumptions in various
scenarios;
— Compared the calculated recoverable values to the
associated carrying amounts, and assessed whether any
impairment charges were required;
— Compared the Group’s market capitalisation with the net
asset value, as an indicator of possible impairment; and
— Considered the appropriateness, sufficiency, and clarity of
goodwill related disclosures included in the Group financial
statements.
Refer to Note 15 to the financial statements.
The Group has $29m of investments in equity accounted
investees and $10.79m of loans to 7 equity accounted investees.
Impairment in the investments and recoverability of loans is
considered to be a key audit matter due to the significance of
the asset and the number of judgemental assumptions required
in the assessment of impairment.
Our approach included the following procedures, amongst
others (where relevant):
— Reviewed management’s assessments of impairment and
recoverability and confirmed approach is in accordance with
the requirements of NZ IAS 36;
— Evaluated and challenged the appropriateness of key
assumptions in these assessments and their impact on
estimated recoverability;
— Agreed inputs used by the Group in their models to assess
impairment to underlying forecasts and strategic plans;
— Involved valuation specialists to challenge key judgements
applied;
Impairment in investments in associates and recoverability of loans to equity accounted investees