The impact of COVID-19 has resulted in Auckland, New Zealand-based Sanford Limited seeing a 17 percent drop in profits for the first half of 2020.
According to the company’s latest financial results, its first-half net profit after tax was NZD 19 million (USD 12.2 million, EUR 10.8 million), compared to last year’s result of NZD 22.9 million (USD 14.7 million, EUR 13 million) for the same period.
The company also reported an adjusted (underlying) earnings before interest and tax (EBIT) of NZD 23.2 million (USD 14.9 million, EUR 13.2 million) for the first six months to 31 March 2020, a drop of 29 percent on adjusted EBIT from the same period last year, which was NZD 32.6 million (USD 21.2 million, EUR 18.7 million).
Sales volumes, as well, dropped for the first half of the year by 13 percent. Despite those drops in volume, the company only saw a 7 percent decrease in revenue, from NZD 265 million (USD 172 million, EUR 152 million) to NZD 245.5 million (USD 172 million, EUR 152 million), largely related to increased yields of king salmon and greenshell mussels.
The pricing of several species was affected due to the impact of COVID-19 on restaurants, the company stated in its report. The report added that COVID-19 impacts were also felt in other areas of the business, particularly toward the end of the reporting period.
Sanford CEO Volker Kuntzsch said while the overall interim result was below expectations, the king salmon and greenshell mussel results showed increased yields, offsetting what could have been much worse.
“We were pleased that overall sales volumes for our salmon were up 2 percent versus the same period last year and sales revenue increased by 6 percent,” Kuntzsch said. “Our Big Glory Bay-grown salmon are exceptional and have been highly sought after in some of the world’s finest restaurants. Unfortunately, foodservice channels have been severely impacted by COVID-19. Domestic retail sales have been holding up well and we are hopeful of continuing growth here.”
Sanford Chief Financial Officer Katherine Turner said that Sanford has been designated an essential business by the New Zealand government, providing Sanford some protection against the impacts of the response to the virus.
“We did experience a short interruption to normal operations in March while we put in place changes right across the business which was necessary to meet government COVID-19 safety requirements," Turner said. "However, thanks to incredible efforts from our fishing, farming and processing teams, we were able to return to relatively normal operations and supply levels within two weeks.”
Photo courtesy of Sanford Limited
