Cape Town, South Africa-based fishing company and frozen-food manufacturer Irvin & Johnson Ltd (I&J), has reported a 0.8 percent increase in revenues to ZAR 1.24 billion (USD 80.6 million, EUR 74.2 million).
The revenue increase was driven a by recovery in the firm's abalone output and better seafood pricing in Asian markets for the six months ending 31 December, 2021, it said.
In its H1 results released on 7 March, 2022, I&J’s parent company, AVI Limited, reported a 2.7 percent increase in the fishing company’s operating profit to ZAR 160 million (EUR 9.5 million, USD 10.4 million).
“I&J’s revenue grew marginally with difficulties in the fishing business offset by a sustained recovery in the abalone business following a myriad of COVID-related market disruptions during the last 24 months,” AVI said in a statement issued through the Johannesburg Stock Exchange. “The improved result is due to the abalone operation, which recovered from poor export demand and low selling prices, due to COVID-19 lockdowns in key markets, last year.”
However, the latest revenue earnings by I&J from fishing operations was lower than that of the previous year due to the stronger South African rand, supply constraints, and delayed exports due to inefficiencies at South Africa’s ports.
During the period under review, I&J reported low catch rates but higher fuel prices. The trend impacted the firm's overall fishing costs, though I&J partially mitigated the situation by optimizing the utilization of its freezer fleet. Higher costs were also offset by stronger selling prices.
Going forward, I&J said it expects to invest more in capital projects that underpin the company’s manufacturing capabilities, product quality, and customer service levels, with expenditure for the next six months projected to be focused on already approved replacements and upgrades across key parts of I&J’s businesses.
“I&J’s prospects for the second semester are materially dependent on fishing performance, exchange rates, and a sustained improvement in abalone demand and selling prices,” the company said.
I&J warned volatile fuel prices could adversely impact its overall operational costs, despite existing hedges. But favorable export exchange rates are likely to support the company’s profitability, according to the company’s predictions.
South Africa's recently completed Fishing Rights Allocations Process (FRAP) reduced I&J’s total hake quota from 27 percent to 25.8 percent, I&J has lodged an appeal contesting the 1.2 percent loss, but the company said its remaining quota would be enough to support the continuity of its operations.
