Oceana reports profit boost as Covid-19 gives canned goods a kick
The producer of Lucky Star Pilchards expects profits to rise as much as 18% to end-September, boosted in part by in-home consumption
Fishing group Oceana, best known for its canned fished under the Lucky Star label, says full-year profits could rise almost a fifth amid sustained demand for its products during Covid-19.
Oceana’s principal market is the lower-end consumer, who purchase canned fish and horse mackerel. The group said it had seen sustained demand for those types of goods during the pandemic, while companies including Pick n Pay and Rhodes Food Group also recently reported healthy demand for longer-life products.
Oceana said in a trading update it expects headline earnings per share to rise between 13% and 18% from the prior year's 544.3c, implying a profit rise of up to R114m.
Oceana was classified as an essential service provider in all countries in which it operated during peak of Covid-19. The group operates in countries including Botswana, France, Kenya, Lesotho, Mozambique, Malawi, Mauritius, Namibia, SA, Swaziland, the UK, Zambia and Zimbabwe.
Oceana said it had been able to continue operating with all employees abiding by stringent standard operating procedures.
The group said improved overall fish landing had also helped, which had been partially offset by Covid-19-related disruptions, and related costs.
In 2019, extended winter weather patterns had adversely affected landings in SA. Local pilchard landings had declined more than two thirds to 5,213 tonnes, less than half the total-allowable catch, as the resource scattered in the inclement weather. Oceana had deployed its boats elsewhere, and fully imported pilchards.
SA’s total allowable catch for pilchards was also at a cyclical low in the group’s 2019 year, while Namibia had put a halt to pilchard fishing. Oceana said in July during the release of its half-year results there were signs of recovery for SA’s pilchards.
In afternoon trade on Thursday, Oceana’s share was marginally down 0.74% to R62.66, having risen 1.8% so far in 2020.
The company has a market capitilisation of R8bn.
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