New Zealand King Salmon has had a turbulent year on the stock market.
The company has been plagued with issues, reporting an increased mortality cost of NZD $20.8 million (€12.7 million) in the fiscal year ending on 31st January 2022, adding to a fully year loss of NZD $73 million (€44.5 million).
On top of the financial situation, the company has been forced to let go of 139 workers, mainly in processing roles, after a drop in production due to the fish mortalities, warming sea temperatures and the ongoing impact of the pandemic.
The company has the unfortunate moniker of being the worst performer on the New Zealand stock exchange, having seen its stock price drop by over 70 percent to a mere NZD $0.20 (€0.12) over the past 12 months.
Read also: Fish die-offs, pandemic force salmon producer to lay off 25 percent of workforce
“Unusually early elevated seawater temperatures were a major factor behind high mortality rates, with the marine heatwave during summer associated with a La Niña event. It resulted in a $20.8 million (€12.7 million) negative impact on profitability from high fish mortalities,” said New Zealand King Salmon CEO Grant Rosewarne said announcing the year-end financial results last April.
Rosewarne added that the company has intensified its efforts to identify and counter the factors that aggravate the climate effect on its salmon. One strategy is to fallow three farms in the Pelorus Sound, where the company traditionally produced salmon year-round. It was in those farms where the bulk of mortalities occurred in the summer. They will instead be used as nursery when they’re fallowed, the company said.
The mass mortality situation put the company under significant financial pressure, with its debt growing and causing issues with its lender the Bank of New Zealand (BNZ). BNZ subsequently agreed to a temporary waiver as long as New Zealand King Salmon raised NZD $50 million (€30.5 million) in new equity after transaction costs. The company sold NZD $60 million (€36.6 million) of shares, using NZD $43 million (€26.2 million) to repay debts and NZD $3 million (€1.8 million)for transaction costs.
New Zealand King Salmon describes itself as a “pioneer in marine salmon farming” in the region, using stock that was introduced from the US state of California over 100 years ago. It has been growing and selling King salmon for over 30 years.
