Cobram Estate Olives has posted its highest-ever earnings and cash flow, while outlining ambitious expansion plans in the US. Chair Rob McGavin told the AGM the company’s growth reflected strong demand for Cobram Estate’s premium extra virgin olive oils.
FY25 delivered record EBITDA of $116.6 million, up from $66.7 million in the prior corresponding period (pcp). Operating cash flow rose almost 30 per cent to $83 million. “Our highest quality, highest price flagship brand is seeing sustained growth,” McGavin said. “Consumers increasingly understand the health benefits of high-quality extra virgin olive oil, they want authenticity, freshness, and traceability,” McGavin said.
The company operates with a vertically integrated model that includes growing, milling, research, marketing, and sustainability in Australia and California.
In the last five years it has invested more than $250 million in capital expenditure including olive grove expansion, major upgrades to its Boort Mill, a new pomace waste treatment facility at Boundary Bend and automated warehousing at Lara.
US business
The US is now a cornerstone to its long-term strategy, with 3600 hectares of groves under development in California. Cobram Estate forecasts production of more than nine million litres of olive oil annually.
McGavin said the US market presents “enormous opportunity” with American’s consuming considerably less (one litre per year) that their European counterparts.
“Olive oil sales in US supermarkets have been growing more than 16 per cent a year by value since 2022, compared with six per cent for other cooking oils.
“As demand for high-quality, locally grown olive oil increases, supply remains the main constraint – and that’s where we see our advantage,” he said.
The company’s $178 million equity raise will fund accelerated growth in the US market
Cobram Estate joint CEO, Leandro Ravetti, has moved to California to lead operations at company-owned groves and with its network of third-party growers.
Proprietary production system
McGavin said the company’s proprietary Oliv.iQ production system underpins its efficiency and environmental credentials. The system enables more olive growth per hectare, higher oil yields, and production of premium extra virgin olive oil at 30 per cent lower cost than global peers.
“Two of our Californian grower partners have lifted fruit production by more than 80 per cent after adopting Oliv.iQ principles,” he said.
“Our groves use significantly less water and fertiliser than the global average, are net carbon sinks, and enhance biodiversity, all while producing some of the most awarded olive oils in the world.”
Outlook
Natural agricultural cycles mean FY26 is expected to be an “off- year”, but the company only expects crop yields to be “moderately lower” than FY25.
“Each additional litre we produce reduces our per-litre cost and directly lifts profit and cash flow. With our mature tree yields around nine times higher than the global average, our model continues to deliver strong returns,” McGavin said.
