Sanford says wild catch profitability is expected to improve with operational efficiencies. Photo / Greg Bowker
Sanford says wild catch profitability is expected to improve with operational efficiencies. Photo / Greg Bowker
Seafood company Sanford says its pandemic recovery momentum is building as it reports its highest revenue result in five years at $553.4 million and net profit after tax of $10m.
TheNZX-listed fishing and aquaculture company said it continued to execute on its five-year strategy to “recover, rebuild and outperform” after Covid-19 impacted the business.
“The commercial focus is on three pathways – Grow Salmon, Grow Mussels and Strengthen Wildcatch. Good progress has been made over the financial year, despite headwinds for the business and the industry,” the company said.
It will pay a final dividend of 6c per share, taking the full-year dividend to 12c per share.
Wildcatch profitability was expected to improve with a focus on operational efficiency and following the sale of much of its North Island annual catch entitlement to Moana New Zealand.
Sanford chairman Sir Rob McLeod.
Chairman Sir Rob McLeod said: “We have a clear view of the commercial pathways for our business and are seeing positive benefits from our strategy, which was refreshed in 2023. Many of the headwinds seen over the past few years are now easing and we expect the trend of annual improvement to be repeated in FY24.
“This year has seen the implementation of a new organisational structure, new technology platforms and new leadership. Our primary goal remains improved profitability. We are clearly on the path to recovery, and it is pleasing to deliver a stronger result for our shareholders.”
Revenue at $553.4m was despite lower volumes, the company said.
Revenue in FY22 was $531.9m.
Net profit after tax in FY22 was $55.8m, up 244 per cent on the previous 12 months, but assisted by the sale of crayfish quota for $43.7m.
FY23 adjusted ebit of $49.4m was up 23 per cent as earnings continued a positive climb back to pre-Covid levels, the company said.
This excluded $18.4m of non-trading adjustments, compared to $12.6m in the prior year. FY23 included $5.5m in restructuring costs as the North Island inshore business closed, and a $2.2m gain following the surrender of a lease at the Port of Tauranga.
Sanford’s FY23 reported ebit was $31m, up 12.3 per cent on $27.6m in the prior year. Reported net profit after tax included non-trading adjustments and unusual transactions.
Operating cashflow was $41.1m. Net debt increased by $51m to $196m as a result of ongoing capital investment, including a new scampi vessel, a technology programme and the Sanford Bioactives facility.
The company said strong mussel pricing and demand was expected to continue into 2024, although the ability to maximise this will be partly restricted due to low seeding in 2023 as a result of weather conditions.
The new Sanford Bioactives facility, commissioned earlier in the year, continued to experience productivity issues and was behind expectations.
It was an area of focus.
Sanford’s mussel business remained in a strong position with water space and infrastructure, and with processing teams now back to full strength, the company said.
Salmon was expected to continue its positive momentum, with strong demand for King salmon and Sanford’s Big Glory Bay brand.
The focus would be on sustaining margins through “smart farming” and the business was exploring the use of AI and automation. A new feed barge was to arrive in March next year, which would benefit farm infrastructure.
Meanwhile, Sanford directors Abby Foote and Fiona Mackenzie have announced their departures.
McLeod said the departures of the two directors in quick succession had very different circumstances.
Mackenzie, while eligible for re-election at this year’s AGM, had decided not to seek re-election, McLeod added.
The AGM is scheduled to be held at Auckland’s Eden Park on December 18.
Andrea Fox joined the Herald as a senior business journalist in 2018 and specialises in writing about the dairy industry, agribusiness, exporting and the logistics sector and supply chains.
