Tasmania, Australia-based Huon Aquaculture Group Limited’s revenue took a tumble in the previous financial year, which it blamed mostly on a jellyfish event.
The company’s registered a plunge in profit after tax (NPAT) of AUS 9.5 million (USD 6.4 million, EUR 5.8 million) for the year ending 30 June, 2019, down from AUS 26.4 million (USD 17.8 million, EUR 16.1 million) FY2018, Huon said in a press release.
Huon said it has forecast the slump in revenues with performance impacted by a fall in harvest volumes and higher operating costs carried over from FY2018.
“This was further exacerbated during the year by a jellyfish event, which increased production costs and caused poor growth rates associated with the secondary health impacts of affected salmon, increasing per kilogram production costs,” it said.
Huon said in the first half of FY2019, some of the pens in the Huon River and D’Entrecasteaux Channel came into contact with a moon jellyfish bloom, causing the fish to die due to a related outbreak of gill necrosis.
Huon suffered a revenue decline of 11 percent in the first half of 2019, posting AUS 28.2 million (USD 19 million, EUR 17.2 million) which was attributed to an 18 percent reduction in harvest tonnage.
It also reported that operating NPAT declined 55 percent due to the reduced harvest and a 16 percent increase in production costs per kilogram, arising from the higher operating costs from the prior year and additional costs associated with the jellyfish bloom.
Despite the drop in revenue, Huon remains optimistic that succeeding years will a better year – at least if there is no repeat of abnormal weather or biological events.
Huon said anticipated production for FY2020 and FY2021 will result in revenue recovery, it said it forecast production volumes for FY2020 of at least 25,000 metric tons (MT) and currently has fish in production that will support a 30,000 MT production in FY2021.
It is also banking on the completion of the second of two major efficiency and expansion programs to deliver a sustainable reduction in costs beyond FY2020.
For the programs, Huon spent AUS 64.3 million (USD 43.2 million, EUR 39.2 million) in the second of a two-year, AUS 150 million (USD 100.8 million, EUR 91.3 million) capital expenditure aimed at developing the infrastructure to usher significant expansion in production over the next three to five years.
Because of spending for the program, Huon's net debt rose by AUS 57.5 million (USD 38.7 million, EUR 35 million) to AUS 138.8 million (USD 93.3 million, EUR 84.5 million).
In the company's 2H 2018 results, Huon Managing Director Peter Bender predicted production volumes in FY2020 of at least 25,000 MT and 30,000 MT production in FY2021.
