Comvita says Fonterra's botulism scare is partly to blame for it losing $1 million in the first half of the year.
Tough competition in Australia and Britain were also factors in a $2 million fall in sales in the six months to September.
The manuka honey products manufacturer also sells dairy products such as colostrum and milk powder and says these have been affected by a combination of factors including the botulism scare and the fact that it was the low season.
However the firm says it remains on track to exceed last year's profit of $7.4 million.
Comvita chief operating officer Scott Coulter says the sales drop was particularly sharp in August and September, especially in Hong Kong, which is its second biggest market.
He says sales in China and Hong Kong are showing signs of picking up in October.
About midday on Friday shares in Comvita were up five cents at $4.