Sea Harvest Group Reports Mixed Interim Results Amid Challenging Conditions

27 Aug 2024 (Johannesburg Stock Exchange) The Sea Harvest Group Limited released its unaudited interim results for the six months ending Ju...

27 Aug 2024 (Johannesburg Stock Exchange) The Sea Harvest Group Limited released its unaudited interim results for the six months ending June 30, 2024, revealing a mixed performance across its segments amid challenging market conditions. The results highlighted a modest increase in revenue but a significant decline in profit attributable to shareholders.

The company's revenue increased by 3% to R3.30 billion from R3.20 billion in the previous year, a minor move attributed to improved selling prices, although offset by lower sales volumes in its hake and dairy divisions. Despite these challenges, the gross profit rose substantially by 22% to R944 million, with the gross profit margin improving to 29% from 24%.

According to information available from the Johannesburg Stock Exchange (JSE), the Sea Harvest Group's EBIT for the period increased by 6% to R373 million, indicating a minor move, while maintaining the EBIT margin at 11%. However, the profit after tax attributable to shareholders saw a very large or significant move, decreasing by 17% to R176.27 million. This decline was mirrored in the headline earnings, which fell by 32% to R144.14 million.

The South African Fishing Group experienced a 27% increase in segment revenue to R1.99 billion, driven by strong demand despite a 5% decrease in catch volumes. The segment's operating profit increased by 26% to R299 million, maintaining an operating profit margin of 15%.

The aquaculture segment saw a revenue surge of 64% to R102 million, largely due to the inclusion of Aqunion following its acquisition. However, reduced demand in key markets impacted sales, resulting in an EBIT of R27 million, down from R79 million in the previous year.

Conversely, the Cape Harvest Foods segment faced a revenue drop of 25% to R787 million due to the deconsolidation of BM Foods Manufacturers. Nonetheless, the operating profit improved by 39% to R40 million, supported by effective cost control measures.

In Australia, the Sea Harvest segment struggled with a 19% decrease in revenue to R424 million, influenced by delayed prawn fishing seasons. This led to an operating loss of R15 million, compared to a modest profit in the prior year.

The report also noted that net finance costs increased to R128 million, owing to higher interest rates and increased debt levels, including acquisition-related debt. The basic earnings per share (EPS) decreased by 21% to 61 cents, while the basic headline earnings per share (HEPS) saw a very large or significant move, declining by 36% to 50 cents.

In corporate developments, Sea Harvest completed the acquisition of Terrasan's pelagics business and a majority stake in its abalone business. This acquisition is expected to diversify the company's portfolio and enhance its earnings in hard currency.

The board expressed gratitude to the management and employees for their contributions but noted that no interim dividend would be declared for the period. The directors assume full responsibility for the preparation of the announcement, emphasizing that it has not been audited by external auditors. The full announcement is accessible on Sea Harvest's website and the JSE's platform.

Provided by SyndiGate Media Inc. (Syndigate.info).