New Zealand largest and oldest seafood company Sanford has reported a solid recovery in the first half of its 2022 financial year, with adjusted EBIT earnings of $19.2 million for the six months to 31st March.
This represents a 79.4% increase on Adjusted EBIT from the same period last year ($10.7 million). Total revenue was $270.9 million for the period, a 16.0% increase on the same period in 2021 ($233.5 million).
‘The uplift in EBIT and revenue is satisfying and we are pleased we have been in a good position to take advantage of the post-Covid recovery in many of our international markets. Now the challenges we face have shifted from demand to supply, with Covid-19 continuing to make its presence felt in New Zealand. This is impacting our operations, particularly in processing where reduced staff availability has impacted productivity and increased costs,’ said Sanford CEO Peter Reidie.
The company reports that the profit contribution from its wildcatch division is up 108.4% versus the prior comparable period, driven by a significant lift in global demand for whitefish. Sanford also reports that maintenance of salmon profitability through increasing revenues by 35.9% to compensate for additional cost in feed, freight and some increased investment to minimise a minor increase in mortality due to warmer water temperatures.
Sanford’s wildcatch division has performed well and demand is strong in this seafood category. Sales volumes however have been depressed by supply availability, with the squid season starting somewhat later than usual.
Improved margins for species such as hoki, scampi and toothfish have driven a lift in profitability for this division.
Sanford anticipates continuing, short term Covid-19 impacts on crewing and processing which it is managing thorough testing, staff attentiveness and policies and procedures.
‘The good news is that our plans to minimise the impact on fishing, farming and production are paying off. We have a 100% vaccinated workforce and we are using Rapid Antigen Testing at the majority of sites, including before entry to our vessels,’ Peter Reidie said.
‘Our people have had to work very hard over the last two years, responding to the Covid pandemic and we are pleased they are generally in good spirits, despite the challenges.’
The company reports few current concerns about supply chain impacts, thanks in large part to its relationship with supply chain collaboration group Kotahi.
‘Our overall outlook is positive as we expect strong demand improvements to continue. The limiting factors for us now are working our way through the domestic impacts of Covid-19 and addressing staff shortages in key areas such as mussel processing,’ he said.
