CAPE TOWN: In a challenging environment in the six months to 30 June 2024, the Sea Harvest Group delivered an EBIT of R373 million, 6% ahead of 2023, and a HEPS of 50 cents. The Group benefited from significantly improved pricing and strong demand in wild-caught fish that saw the Group’s revenue increase by 3% to R3.3 billion (2023: R3.2 billion), with the performance constrained by continued low hake catch rates, deteriorating market conditions in abalone markets and higher interest rates in both South Africa and Australia.
Sea Harvest Group CEO, Felix Ratheb, says, “The first six months of this year have been some of the toughest months in the history of the Group with the tragic sinking of the MFV Lepanto. The Board, management and staff extend our deepest condolences to the families and loved ones to the 11 crewmen lost at sea. As, a Group, we continue providing support to the affected families, whilst continuing to cooperate with the investigation into the incident by the South African Maritime Safety Authority (SAMSA).”
During the period, the Group completed the acquisition of Aqunion and Saldanha/Westpoint Fishing thereby diversifying into pelagic (anchovy and pilchard) fishing and completing the Group’s exposure to all material wild-caught fisheries in South Africa, while the abalone business doubles in size, creating a world-class and competitive aquaculture business of scale. Commenting on the acquisition, Sea Harvest Group Chairman, Fred Robertson, says “This transaction is of strategic benefit to Sea Harvest as it has increased the Group’s hard currency earnings, created a stronger merged business, increased black ownership in the fishing and abalone industries, and broadened
Sea Harvest’s shareholder base.”
Focusing on the Group’s segmental performance, the lower catch volumes in the hake fishery in its South African fishing operations resulted in lower sales volumes however this was offset by significantly improved pricing during the period. The Group’s dairy operations at Ladismith performed well despite a tough local consumer environment, benefiting from increased milk flow and good cost control. Whilst the Group’s abalone business recorded good animal stock growth on its farms, the markets have been particularly tough in the second quarter of 2024 with reduced demand and increased competition in the sector impacting selling prices. Overall, the Group’s earnings continue to be weighed down by persistently higher interest rates.
“As we continue into the second half of 2024, we look forward to the fish volumes still available to be caught by the Group, supported by firm local and international hake markets, and the improvement of our H2 weighted operations in Australia. With the addition of Sea Harvest Pelagics and Aqunion and the potential decrease in interest rates, the Group looks forward to an ease in operating conditions for the rest of the year,” concluded Felix.