Seafood company Sanford's recovery from the pandemic continues to gain momentum, with its underlying profit almost doubling.
The company reported improved revenue across its wild catch and mussel businesses. Photo:
The company's bottom line has fallen by more than half, but the previous year's result had been boosted by one-off gains associated with the sale of a property.
Its adjusted underlying earnings were up 79 percent on a year ago, as revenue increased following higher sales and better margins for hoki, scampi, toothfish and salmon.
Key numbers for the six months ended March compared to a year ago:
- Net profit $6.1m vs $13.8m
- Revenue $270.9m vs $233,5m
- Adjusted underlying profit $19.2m vs $10.7m
- Net cash flow $35.8m vs $4.5m
- No dividend.
Sanford's earnings had taken a hammering over the past two years, due to lower consumer demand following the emergence of Covid-19.
Chief executive Peter Reidie said the result was pleasing, although it was experiencing ongoing challenges on the domestic front.
"The uplift [in underlying earnings] 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."
Reidie said this continued to have an effect on its operations, particularly in its processing division, where reduced staff availability had impacted on productivity and increased costs.
The company reported improved revenue across its wild catch and mussel businesses.
However, Reidie said the improvement in mussels was hampered by a processing bottleneck caused by skills shortages.
Salmon earnings were a third higher than a year ago, but sales volumes were down, due to increased fish deaths because of warmer waters.
Looking ahead, he said the company's outlook was positive as it expects improvements in demand 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."
Sanford's board chose not to pay an interim dividend but indicated it may pay a dividend at the end of the financial year.
