Seafood processor, Tassal Group Limited (ASX: TGR) has released its financial and business results for the first half of fiscal year 2019, ended 31 December 2018 (1H FY19). According to the Company’s announcement, Tassal Group has delivered its best-ever first-half results across all key operational and financial metrics. Following the release of the results, the share price of the company zoomed up by 4.30% in the intraday trade as on 14 February 2019.
During the half year period, the company witnessed a significant increase in salmon growth and sales which has resulted in strong growth in the company’s revenue and EBITDA. The operating Net profit after tax (NPAT) of the company increased by 22.3% to $31.7 million in H1 FY 2019 as compared to the previous corresponding period (pcp). Moreover, the operating cashflow of the company increased by 96.3% to $79.6 million in H1 FY2019. The uplift in the Operating NPAT and operating cashflow highlight the strength of the company’s platform to generate continued, sustainable growth in shareholder returns.
The total salmon sales volumes increased by 21.7% to 20,578 Hog tonnes in H1 FY 2019 as compared to PCP. Further, the Australian domestic volume increased by 18.8% to 13,950 Hog tonnes in H1 FY 2019. The strong growth in the salmon sales volumes has resulted in a 32.8% growth in salmon revenue which has reached to $285.4 million.
In the export market, the demand is outpacing supply which has allowed Tassal to drive sales in 1H19. In the export market, the Sales pricing increased by 13% which demonstrates stronger global pricing, optimal fish size and favourable exchange rates. Further, the Sales volume in the export market was up 28.3% in H1 FY 2019 and Sales revenue was up 45.0% as compared to PCP.
While commenting on the positive outlook for 2H19, the company’s Managing Director & CEO Mark Ryan told that the company is in its strongest position ever to deliver on its long-term growth strategy, with diversified operations across salmon and prawns. He further told that the company will look to replicate the growing returns in its salmon business, achieved through farming and technology initiatives, into our prawn business.
The company is now successfully integrating the strategically compelling and highly earnings accretive acquisition of the Fortune Group which is having Australia’s largest prawn farming footprint. It is expected that the acquisition will deliver material earnings in the short to medium term.
According to Mr. Ryan, the company is in a “very exciting position with a strong salmon business, strong De Costi Seafoods distribution business, and attractive newly acquired prawn business, to be able to deliver another record result in FY19.”
Meanwhile, in the last six months, the share price of the company increased by 6.16% as on 13 February 2019. TGR’s shares settled at $4.850 with a market capitalization of circa $824.28 million as on 14 February 2019. It has 52 weeks high of $5.095 and 52 weeks low of $3.450.
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