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Ocean Grown Abalone Ltd (ASX:OGA) is running abalone ranching business in Flinders Bay, located in Augusta, Western Australia. On 4 January 2019, Ocean Grown Abalone Ltd announced that it has received approval from the Western Australian Department of Primary Industries and Regional Development (DPIRD) to increase the number of Abitats to 15,000 from the current 10,000 at the Companyâs Flinders Bay lease.Â
This approval will enable the Company to further expand the Flinders Bay ranches to an anticipated maximum capacity of 300 tonnes per annum from the current maximum capacity of 200 tonnes per annum. Â The company also announced that DPIRD and OGA will work in collaboration to conduct scientific research which will be focused on growth optimization of greenlip abalone.
The scientific research will target OGAâs ranch in Flinders Bay, which currently has greenlip abalone at various growth stages over its existing 10k Abitiats. OGA believes that this collaboration with DPIRD is a unique opportunity for the company to develop the abalone industry in Western Australia.
This approval has provided various opportunities for the company which includes working with DPIRD and the expansion in the number of Abitats. Further, the research project will provide further economic growth potential and job opportunities to the Augusta and Margaret River regions of Western Australia (WA) through expansion of the broader abalone industry and through opportunities for OGA to expand its existing operations.
On 30 November 2018, the company announced the appointment of Mr. Romolo Santoro as the Company Secretary. In November 2018, DPIRD gave its approval for the companyâs 3 x 1-hectare trial sites in Flinders Bay for OGA to test its proprietary abalone sea ranching technology outside of the existing aquaculture lease in Flinders Bay.
In the first quarter of FY 2019, the company sold 10.4 tonnes of abalone, exhibiting 12 percent higher than the prior corresponding period. However, the Sales volumes were significantly lower than expected due to unseasonal weather conditions resulting in large oceanic swells, which affected diver utilization and the ability to harvest. As at 30 June 2018, the company was having cash and cash equivalent of $5.74 million. In October 2018, the company received an R&D Tax Incentive of $1.99 million which is reflected in the Q1 FY2019 closing cash balance at 30 September 2018.
Meanwhile, the share price has fallen 22.86% in the past six months as at January 03, 2019 and is trading close to lower level. OGAâs shares traded at $0.135 with a market capitalization of circa $23.5 million as on 4 January 2019 (AEST 2:40 PM).
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