Paengaroa based global natural health and beauty products company Comvita is lowering its forecast net profit due to shortages and price hikes for its key ingredient Manuka honey.

The manufacturer of products made from Manuka honey and olive leaves released a statement today announcing it was lowering its earnings guidance due to industry wide shortages in supply, price rises for honey and difficult trading environments in United Kingdom and Australia.

Comvita produces health and beauty products made from Manuka honey.

Comvita now forecasts net profit after tax of approximately $7million for the year ending March 31, down from 8.2million in 2012 – a figure it was hoping to beat, reports Comvita.

Comvita now expects total sales for the full year to be approximately $100million, up 4 per cent on the prior year.

'The accumulated effect of two successive years of poor honey harvest for the beekeeping industry, due to generally inclement weather, resulted in sharp increases of up to 50 per cent in the wholesale purchase price for Manuka honey during 2012.”

'The full extent of the increases in purchase price only became apparent during the latter part of the year,” reports the company.

Trading in Australia and the United Kingdom has also been difficult with a general downturn in the

economy and consumer confidence in the markets resulting in an increasingly competitive environment for our retail customers.

'While we have been successful in pushing through price rises that better reflect the raw material cost increases, this has resulted in a loss of sales with the more price-sensitive trade customers.”

'In contrast, sales in our key Asian markets and in New Zealand have been strong.”

'While we regret the need to downgrade the earnings outlook for this financial year, we remain confident that the reasons for the downturn are isolated and that mitigation measures are already in place.

'Most importantly, the current strategy still holds with business on a path of strong earnings growth beyond this financial year.”

Comvita will release its results for the full year to March in late May 2013.