Cape Town, South Africa-based fishing company and frozen-food manufacturer Irvin and Johnson (I&J), an affiliate of AVI Group, has announced a 5.1 percent drop in overall revenue from its global operations to ZAR 2.47 billion (USD 142.5 million, EUR 141.8 million) for the year ending 30 June, 2022.
The drop comes on the back of lower fishing profits triggered by a strong South African rand affecting export sales, and lower sales volumes.
“The financial year was characterized by a tough macro environment for our consumers, the July riots [in South Africa], substantial challenges in supply chains globally and domestically, the operational disruptions caused by load-shedding, and material input cost inflation,” AVI Group said in its financial report.
I&J’s operating profit also decreased from ZAR 341.6 million (USD 19.7 million, EUR 19.6 million) to ZAR 306.2 million (USD 17.66 million, EUR 17.57 million), representing a dip in profit margin from 13.1 percent to 12.4 percent.
“The overall result was negatively impacted by lower fishing profits, with declines relative to last year in the first and second semesters,” AVI said.
AVI said the decline could have been an impact of “a strong rand on export sales, lower fish sale volumes due to lower catch rates, which were partly offset by a better utilization of the fleet and a favorable catch size mix, and substantially higher fuel costs for the fishing fleet, despite the benefit of fuel hedges," it said. “Price increases were taken in both our domestic and export markets but these did not fully absorb the impact of higher fuel costs."
I&J’s South Africa business operations reported a revenue increase to ZAR 970.2 million (USD 55.96 million, EUR 55.67 million), up from ZAR 893.4 million (USD 51.53 million, EUR 51.26 million) in 2021.
And I&J’s abalone operation “delivered strong profit growth with a sustained post COVID-19 recovery due to improved pricing, a favorable product mix and increased demand in key Asian markets.”
“Overall demand benefitted from the development of new markets with volumes in some formats impacted by Chinese lockdowns during parts of the year,” it said.
AVI Group Chairman Gavin Tipper and AVI CEO Simon Crutchley said in a joint statement published South Africa's long-term rights allocation process for hake, which concluded on 28 February, 2022, and subsequent allocations published for review and appeal by applicants, was disappointing to I&J’s business strategy in South Africa.
“This outcome, although subject to appeal, will allow AVI to fine tune I&J’s long-term strategy and capital investment plans,” the joint statement said.
In March 2022, the company posted a 0.8 percent increase in its H1 revenues.
Photo courtesy of the AVI Group
