New Zealand King Salmon Investments Limited (ASX: NZK) deals in the production and processing of the premium King salmon species, sustainably grown in the Marlborough Sounds, New Zealand. It is one of the leading aquaculture companies in New Zealand.
The company announced an update on fish performance after the crucial summer period yesterday, 01 May 2019. Due to the constant warm water temperatures in 2019 summer season, it has been a challenging season for overall fish performance.
The company forecasts the full year mortality cost for the year ended 30 June 2019 (FY19) to be slightly higher than the price in FY18 and the fish harvest for FY19 to be nearly 7,900MT. The fish harvest for FY20 is forecasted to be on same lines as in FY19 due to the challenging summer while it was earlier advised at around 8,700MT.
According to the Directors of the company, the anticipated operating EBITDA in FY19 would be between $25.0 million and $28.5 million.
The climate change has been identified as the key ‘Environmental, Social and Governance’ risk by Agri companies. New Zealand King Salmon took some important measures to alleviate such risk including:
- The company decided to shift to site single year class of fish across all farms as early as possible and to ensure fallowing between year classes. This will lead to an increase in capital expenditure requirements in the next few years and will bring a substantial reduction in earlier anticipated harvest volumes.
- By working with Government and the local community to get consent for the relocation of low flow sites to higher flow areas.
- Making longer term open ocean farming as an objective.
According to the Managing Director and CEO of NZK, the Coalition Government is working on alleviating the effects of climate change and the New Zealand’s green rated salmon industry is supporting the government in fulfilling its commitment.
In March, the company released the interim consolidated statement of comprehensive income for the six months ended 31 December 2018. The company reported a gross profit of around $36.7 million and Earnings before interest, tax, depreciation and amortisation of $24.81 million during the half year. The net profit after tax was recorded at approximately $15 million. The cash and cash equivalents of the company at 31 December 2018 stood at $7.4 million.
On 13th March 2019, the company announced that it has planned to follow the NZX Listing Rules from 22 March 2019. Its 2019 financial year interim results would be released complying with the new listing rules dated 1 January 2019, reported the company.
The company’s stock was trading at AUD 2.320 (at 12:00 PM AEST on 2nd May 2019), marginally up by 0.433%. 5,739 number of shares exchanged hands as of this moment, and 138.57 million shares are outstanding. The market capitalisation of the company was recorded at AUD 320.10 million with the 52-week high and low value being AUD 2.850 and AUD 1.980 respectively.