WHILE global prices for luxury seafood and fish oils are taking a hit, Lucky Star tin fish has kept parent company Oceana profitable.
Oceana increased headline earnings per share by 7.7% for the six months ended 31 March, with stronger performances from its Lucky Star and Wild Caught Seafood businesses helping offset weaker global fish oil and fishmeal prices.
The fishing and food processing group said yesterday while revenue declined 6% to R4.9 billion, improved margins and lower financing costs supported profitability during the period.
For Namibia, where fishing remains a major contributor to employment and export earnings, Oceana reported lower catch rates during the period.
However, reduced fuel prices and lower quota usage fees helped ease pressure on operating costs, contributing to stronger profitability from local operations.
The fishing sector in Namibia contributes about N$13 billion annually to the gross domestic product and employs close to 20 000 people.
“While revenue declined by 6% to N$4.9 billion, the gross profit margin improved by 30 basis points to 28.1%, leading to an operating profit of N$665 million, largely in line with the prior period,” the company said.
The group also declared an unchanged dividend of 110 cents(N$1.10) per share while net debt fell to R1.7 billion, helping reduce interest expenses by N$45 million.
Debt repayments and lower working capital requirements improved Oceana’s net debt-to-Ebitda ratio to 1.1 times from 2.2 times in the previous period.
“Investing in our fleet and factories, paying down debt and controlling what we can has ensured resilience in this unpredictable environment,” says Oceana chief executive Neville Brink.
Lucky Star emerged as one of the group’s strongest performers, selling 5.1 million cartons and slightly surpassing record volumes achieved in the previous period. While canned fish sales remained stable, stronger customer demand drove an increase in canned meat sales.
Although global supplies of frozen fish remained constrained and canning volumes in South Africa declined, the business remains profitable.
“This improvement was driven by lower cost of imported fish, increased local pilchard landings, a favourable sales mix and reductions in logistics and storage costs,” the company says in a statement.
The Wild Caught Seafood segment also delivered stronger results, with higher hake volumes supported by fleet upgrades and improved vessel reliability lifting sales by 10%.
“Horse mackerel sales volumes grew by 13%, with South African operations benefiting from improved catch rates,” the company says.
