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Highlights
- Higher sea farm mortality affects FY26 harvest projections
- FY25 earnings guidance remains unchanged
- Company implements strategies to mitigate risks from elevated water temperatures
New Zealand King Salmon Investments Limited (ASX:NZK) has reported higher-than-expected sea farm mortality and lower growth rates, which are projected to impact harvest volumes for FY26. While mortality levels have increased, they remain significantly lower than those seen at the end of FY22 and the beginning of FY23.
Impact on Harvest and Financial Projections
Despite the mortality challenges, the company has maintained its FY25 guidance, expecting pro-forma operating EBITDA to range between $26 million and $30 million. However, for FY26, initial harvest estimates have been revised to 5,900 to 6,300 metric tonnes (MT) gutted weight (G&G), with an expected pro-forma operating EBITDA range between $15 million and $24 million. Investors can expect further updates when the company releases its full-year results on March 27, 2025.
Causes of Increased Mortality and Response Measures
The rise in fish mortality has been linked to prolonged periods of elevated water temperatures, which increase stress levels and weaken salmon resistance to pathogens. In response, New Zealand King Salmon has been adjusting its farming model to minimize summer mortality risks.
Key strategies include:
- Avoiding farming at warmer sites during peak summer months
- Investing in thermotolerance initiatives to improve fish resilience
- Developing vaccines and enhancing fish diets to strengthen immune responses
These measures are part of the company’s long-term commitment to improving operational stability and ensuring sustainable farming practices despite environmental challenges.
Future Outlook
While FY26 projections indicate a potential impact on earnings due to increased mortality, the company remains focused on long-term solutions. Ongoing research and development efforts in salmon health management and farm optimization are expected to contribute to improved outcomes in the future.
With environmental factors playing a crucial role in aquaculture, the company continues to monitor conditions closely while refining its mitigation strategies. As New Zealand King Salmon navigates these challenges, industry observers are watching how these adaptive measures influence overall performance in the coming years.
