Auckland, New Zealand-based Sanford Limited said COVID-19 continued to hamper its profitability in 2021, resulting in disappointing full-year results to 30 September, 2021.
In its latest financial report, Sanford posted a sales revenue increase of 4 percent to NZD 468.8 million (USD 329 million, EUR 291 million), while the company's net profit after tax was down 16 percent compared to the previous year at NZD 16.2 million (USD 11.4 million, EUR 10.1 million). Adjusted earnings before interest and taxes for 2021 were NZD 23.3 million (USD 16.3 million, EUR 14.5 million), down 39 percent from NZD 38.3 million (USD 26.9 million, EUR 23.8 million) in 2020.
Sanford Board Chair Robert McLeod said COVID-19 continued to impair the company’s profits, but that the company was showing signs of improved performance following the worst of the pandemic's impact.
“This [COVID-19] has hit the foodservice sector, where the majority of the world’s seafood is consumed,” McLeod said. “The most-significant impact this year has been to our mussels division, which depends on the half-shell format for its volume-based sales.”
Sanford CEO Peter Reidie said the company would likely continue to see improvement as the world emerges from the COVID-19 crisis.
“While we have seen a lag in the recovery of our mussels division, we have also seen our wild-catch and salmon divisions beginning to improve, and mussels inventory finally normalizing in the latter part of 2021 as the pandemic response has evolved globally,” Reidie said.
Reidie said supply-chain reliability and costs related to it remain a challenge for Sanford.
“We have been actively working to minimize supply chain risks and have recently agreed on a two-year arrangement with supply chain collaboration group Kotahi, which will take responsibility for all our frozen export capacity,” Reidie said. “This makes us much more confident about access to shipping.”
Over the past year, the company decreased its net debt, which decreased to NZD 178.6 million (USD 125.3 million, EUR 111 million) in 2021 versus NZD 184.3 million (USD 129.2 million, EUR 114.3 million) in 2020.
Sanford said the increase an increase in shareholding by investor Ngāi Tahu in September 2021 is a positive development for the company.
“Ngāi Tahu is one of New Zealand’s largest and most-successful investors, with a substantial stake in and knowledge of the seafood sector,” the company said. “We share important common values and a long-term view which recognizes the importance of a sustainable approach.”
Reide said the future is bright for the company. with strategic transitions aimed at increasing profits.
Moving forward, Reidie said, the company will prioritize rebuilding the profitability of its mussels division; continue to pursue opportunities in its wild-catch division; retain the profitiability of its salmon-farming division; and improve its business culture and risk-management processes.
Sanford's strategy through 2026 will be presented to the market in the first half of 2022. Assisting the process is a new CFO, Paul Alston, who joined the company in October 2021.
Photo courtesy of Sanford Limited
