NZ King Salmon within guidance, sales down in stormy Covid waters

NZ King Salmon farms in the Marlborough Sounds. Photo / Supplied

NZ King Salmon has held operating earnings within guidance despite its sales revenue falling by 50 per cent during the level 4 lockdown response to Covid-19.

The world's biggest producer of premium king salmon posted operating ebitda of $25.1m for the year ended June 30, the lower end of its half year guidance of $25-$28.5m.

Net profit of $18m was 59 per cent up on the previous year. Revenue at $155.3m was down 10 per cent on the previous year and sales volumes fell 16 per cent at 6331 tonnes.

Pricing strengthened to $24.54/kg, up 7 per cent.

No final dividend will be paid because of Covid-19 uncertainty, higher inventory levels and to ensure prudent cash availability.

Trading was now around 20 per cent below pre-Covid levels but managing director and chief executive Grant Rosewarne said there were encouraging signs in export markets, particularly the key US market, which had been hit hard by the virus.

The company qualified as an essential service during lockdown so was able to keep harvesting and selling, but harvesting volumes fell during the response and sales were impacted by a slump in the food service and hospitality sectors in its key export markets.

Chairman John Ryder said the year had been one of the most challenging in his business career.

He thanked staff for seeing the company through the difficult period and said much of its resilience was due to the support of customers, partners, suppliers and shareholders.

Rosewarne said with the help of the wage subsidy, the company had been able to keep its 550 staff employed.

The company's application to establish New Zealand's first open ocean farm in Cook Strait, 7km north of Cape Lambert, was progressing well with a resource consent hearing expected by the end of the year.

With the departure of chief operating officer Alan Cook, a Canadian who returned home after less than a year in the job, the company had decided to split the role to enable more focus on aquaculture and processing operations respectively.

Internal appointment Grant Lovell would become general manager aquaculture.

The company paid an interim dividend of 2c per share.