Reduced sales volumes dent New Zealand King Salmon’s profits
New Zealand King Salmon Investments Ltd. (NZKS) posted a net profit of NZD 15.1 million (USD 10.3 million, EUR 9 million) for the first half of the 2019 financial year, ending 31 December, 2018, a decrease of NZD 600,000 (USD 408,201, EUR 358,668) year-on-year. This led to a pro forma operating EBITDA of NZD 17.3 million (USD 11.8 million, EUR 10.3 million), down from NZD 19.5 million (USD 13.3 million, EUR 11.7 million) in H1 2018.
For the six-month period, the world’s largest aquaculture producer of king salmon sold 3,824 metric tons (MT) of gilled and gutted fish, a decrease of 13 percent year-on-year. It attributed the reduction to harvest seasonality and lower fish numbers carried forward from the 2018 financial year.
Revenues were on par with the same period of 2018 at NZD 87.7 million (USD 59.7 million, EUR 52.4 million), while prices increased in key markets. The average per kg price achieved for domestic sales and export sales climbed to NZD 22.20 (USD 15.10, EUR 13.27) and NZD 23.49 (USD 15.99, EUR 14.05), respectively.
“Every business has challenges and ours is no exception. While lower salmon sales volumes were largely mitigated by value gains in our sales activities, adapting to pressing environmental changes remains a business priority moving forward, NZKS CEO Grant Rosewarne said.
He said that the company is continuing to work with New Zealand’s government to relocate several low-flow sites in the Marlborough Sounds for improved environmental, social, and economic outcomes. It is also furthering its initial investigations into open-ocean farming.
“Our changing climate and the need for low-carbon, high-nutrition food production models are truly global issues. We see aquaculture as a global force for good in addressing these challenges,” Rosewarne said. “With that vision in mind, we’ve joined the United Nations’ Global Compact’s Ocean Action Platform aiming to be stewards of the ocean and farm for the future.”
The company highlighted that February and March are always the most challenging months from a mortality perspective and that it would provide an update on the market once the summer was over. It is also trialing a number of alternative summer diets.
Looking ahead, it expects the 2019 financial year harvest to be consistent with last year at around 8,000 MT, rising to 8,700 MT in 2020 and 9,500 MT in 2021.
Photo courtesy of NZKS