New Zealand King earnings up 169%

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New Zealand King Salmon reported a 169-percent growth in EBITDA for the first-half of 2018, up to AUD 15.7 million (EUR 9.86 million) on strong global demand and more sales volume, the company reported at the weekend.

The result came on revenues of USD 87.7 million (EUR 55.1 million) that were up 38 percent over the 2017 period.

The company sold 4,392 tonnes (4,434 harvested) of gilled-and-gutted salmon for the half-year that ended on Dec. 31st, 2017, up 29 percent over the year-ago period. While the company said it saw “favourable growing conditions” for the full 2017 accounting year, it issued a warning over the coming summer season.

Summer heat
“The situation has now become more challenging,” chairman John Ryder was quoted as saying, adding that mortality was up to nine percent from 4.7 percent a year ago.

“The extraordinarily hot summer has impacted the survival rates of our King salmon, and this will be a principal factor behind an anticipated reduction in profits for the second half,” Ryder warned.

Meanwhile, the company said it was seeing growth in sales volumes and “significant gains in the average selling price” of the company’s King salmon. A national ad campaign was cited as the reason for increased consumer appetite for salmon.

New sites
As for the feared summer season of higher water temperatures and disease, the company said it was ready with new tech from a recent capital-spending drive. It also said it would move six net pens to areas of more tidal flow as per the recommendations of a new Ministry of Primary Industries recommendation.

That will help combat the summer heat, and the company will benefit is expected to benefit in future from new production areas.

“We don’t have ISA, IPN and all the other salmon sicknesses, but do get diseases when it’s too hot. And we don’t have sea lice. We export about 60 percent of our volume to 15 countries. Government hasn’t set aside production areas for the industry,” company CEO, Grant Rosewarne, told SalmonBusiness in early February.

The company has 6,684 tonnes of biomass in the sea, and some it will have to be moved. The biomass count is 7 percent higher year-on-year.

The company will issue a dividend of 2 cents per share on March 23rd.