Oceana nets R161m tax windfall from Donald Trump
Oceana Group received a R161m tax windfall from US President Donald Trump, the JSE-listed fishing company’s interim results for the six months to March show.
The group reported tax income of R47m for the interim period, from a tax expense of R105m a year before, thanks largely to a once-off $13m deferred tax adjustment at its Daybrook Fisheries unit in the US. Oceana bought Daybrook in mid-2015.
The new US regime cut the federal corporate tax rate from 35% to 21%, effective from January 1 2018.
The tax break boosted Oceana’s net profits by nearly two-thirds to R378m. Revenues in the six months ended March were up 11% at R3.5bn, thanks to better sales volumes in Africa.
Oceana said it achieved a "solid" financial performance in the interim period, partly because of a recovery of the African operations, which struggled in 2017.
"Material volume improvements in the canned fish and hake and horse mackerel segments and continued efficiencies contributed to the positive performance, bolstered by improved management of foreign currency exposure," the group said.
Tax breaks aside, Daybreak’s results were dented by the "negative impact of 2017 prices on long-term fishmeal and fish oil contracts".
"Fishmeal volume growth in our Daybrook operations was offset by lower fish oil volumes, reduced prices and the effect of a stronger rand on US revenues," Oceana said.
The group said losses from associates and joint ventures increased to R29m from R9m previously because of the moratorium on pilchard fishing in Namibia and tough fishing conditions in Angola.
Meanwhile, the goup said that its operations in Africa were "well positioned to deliver a solid performance for the next six months".
Its US operations, which will not benefit from another imminent tax adjustment, were expected to receive a boost from "good landings and improved [fish] oil yields, based on early season indicators".
Oceana, which is currently being led by chief financial officer and interim CEO Imraan Soomra, said it was looking for a new CEO.