"The past financial year has been challenging for the company, due to issues with the wider environment, including increased mortalities and the ongoing Covid-19 pandemic," the company said.
It had been a difficult year, including an increase in sea farm mortalities, continued freight headwinds and impairments to plant, equipment and intangibles.
Sales volumes increased by 20.3 per cent to 7,672 tonnes in the year and revenue rose by 11.8 per cent to $174.5m.
An event in January increased mortality costs by 29 per cent to $20.8m.
Finished goods inventories continued to be managed down following a build-up in inventory mainly due to Covid disruptions across food service markets.
Most of it the company's frozen whole fish stock was cleared in the year at discounted prices.
Freight costs on a per kg basis increased during the year due to ongoing disruptions to the global logistics environment.
NZ King Salmon said it had reassessed its strategies to create a more secure platform for future expansion.
Chief executive Grant Rosewarne said it had been a tough period.
"Unusually early elevated seawater temperatures were a major factor behind high mortality rates, with the marine heatwave during summer associated with a La Niña event.
"Ongoing supply chain disruptions, soaring freight charges and mortalities continue to impact our business," he said.
"Our hospitality customers also continue to be affected by lockdowns and social disruptions," he said.
The company has traditionally farmed salmon all year round in the Pelorus and Queen Charlotte Sounds, as well as Tory Channel, in the Marlborough Sounds.
The bulk of mortalities have occurred when it has farmed through the summer in the Pelorus or Queen Charlotte Sounds.
To combat the continuing effects of climate change the company plans to fallow three farms in the Pelorus Sound.
"This will result in reduced harvest volumes but lower mortality costs, thereby giving us a more stable, predictable operation," Rosewarne said.
These measures will result in a forecast decline in production in 2023 and 2024 to 5,700 and 6,500 tonnes respectively, with a 200-tonne predicted increase in 2025.
The reduction in output would be partially offset by a rigorous review of overheads and a downsizing of the company.
The hearing for NZ King Salmon's open ocean Blue Endeavour application, 7km north of Cape Lambert in Cook Strait, is due to be completed at the end of April. The company expects a decision mid-year.
If Blue Endeavour is approved, the three fallowed farms in the Pelorus Sound would be used as nursery sites for nine months of the year, avoiding the summer months with fish being transferred to Blue Endeavour at around 1.5 kg to grow out to 4.2kg on average.
Blue Endeavour was an opportunity for the company to sustainably increase its scale and value proposition.
Post the rights offer, the company said it will have total liquidity of $13.2m, with no debt on the balance sheet.
