PremFish beats its prelisting forecast
Premier Fishing and Brands (PremFish), which owns operations in export-orientated sectors such as south coast lobster and abalone farming, has beaten its prelisting profit forecast in the year to end-August.
Results released on Tuesday showed profit before tax at almost R95m, compared with a prelisting forecast of R91m.
PremFish posted headline earnings per share of 34.6c versus the 33c pencilled in when the company listed in March. It also paid a 15c per share dividend, covered just over two times by earnings.
Vunani Securities analyst Anthony Clark said PremFish performed admirably in a "very tough" operating environment.
A divisional review showed that Premier’s mainstay lobster division generated R191m in revenue, with operating profits coming in at R52m.
PremFish CEO Samir Saban noted good catches with lower production costs and efficiencies resulting in higher margins that offset the stronger rand.
The pelagic division netted revenues of R81m and operating profit of R24m.
Pelagic revenue and operating profit was lower than the previous year after lower-than-expected pilchard catch rates were experienced industry-wide, Saban said. But industrial fish landings were in line with management’s expectations.
The high-margin abalone farming division reported operating profit of R13m on turnover of R36m.
Abalone sales were lower than those of the previous year after a decision to grow out larger sizes for customers for the new financial year, Saban said. Stock value increased 13% and this volume would be realised in the new financial year.
Planned expansion at the Gansbaai abalone farm was on target. "We are to have a fully grown farm by 2019-20 to meet the international demand for our product and brand."
Khalid Abdulla, CEO of PremFish’s major shareholder, African Empowerment Equity Investments, said the fishing group’s planned growth was taking place in earnest. Last week, PremFish proposed acquiring specialist Talhado Fishing Enterprises, the largest squid player in SA’s fishing market. PremFish was in a strong financial position to pursue acquisition and organic-growth strategies aggressively, he said.
In the countdown to the new fishing rights allocation process in 2020, said Clark, PremFish remained "extremely well-placed" as the most empowered fishing company to benefit from increased allocations in species where it was not represented, such as pilchards, horse mackerel and hake.