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Sea Harvest’s aquaculture segment shows growth

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South Africa based agri-business and seafood company Sea Harvest, has seen significant growth in its aquaculture segment

Sea Harvest’s aquaculture segment shows growth

 Despite a disappointing performance by seafood and agri-business Sea Harvest’s fishing operation, the company’s aquaculture segment showed good growth.

Sea Harvest’s aquaculture segment increased revenue by 55% to R56- million, benefiting from increased abalone sales volumes and pricing, resulting in the segment halving its loss to R18-million.

The company suffered a loss in hake volumes during the first six months of the year though, which they attribute to the recently concluded Fishing Rights Allocation Process (FRAP), while the rising fuel price had a significant financial impact on its operations.

According to Sea Harvest Group CEO, Felix Ratheb, the company had to confront tough macro-environmental factors driven by significant input cost pressures and supply chain disruptions.

“The South African fishing operation, the bedrock of the group, had to contend with a 10% decrease in available hake quota volumes due to losses associated with the FRAP and a reduction in the Total Allowed Catch (TAC), compounded by significantly higher fuel prices and a stronger exchange Rand, resulting in 25% lower operating profit for the period.

FRAP lays good foundation

Despite the headwinds, the group delivered earnings before interest and tax (EBIT) of R287- million and headline earnings per share of 65 cents, 10% behind 2021 respectively, an acceptable outcome in the circumstances,” says Ratheb.

“Although we were disappointed with the outcome of the FRAP, considering that Sea Harvest was one of the top performing companies in all sectors it applied for, the result lays a good foundation for certainty and stability to the group for the next 15 years,” adds Ratheb.

Despite the tough operating environment, Sea Harvets completed the acquisition of MG Kailis’ fishing business on 23 May 2022, which Ratheb says represents a significant step in the execution of the group’s investment strategy of acquisitive growth in the international seafood space.

“It complements and diversifies our existing business operations in Australia. The Australian subsidiary performed well, with revenue up 17% for the period. Pleasingly, our other operations continue to deliver. The Cape Harvest Foods segment increased 85% to R956- million as a result of the increased capacity at Ladismith Cheese, combined with the Mooivallei and BM Foods acquisitions,” says Ratheb.

Sea harvest employs more than 5300 employees, operates 60 vessels and 15 processing facilities in South Africa, Australia, Namibia and Mozambique, selling its products to more than 26 countries across the globe. The group owns two dairy operations in Ladismith and Bonnievale in the Western Cape, South Africa, producing a variety of cheese, butter and powder products. Sea Harvest Aquaculture operates two abalone aquaculture farms and two oyster farms in South Africa and Namibia.

Sea Harvest supports an ecosystem approach to fisheries (EAF) management in its wild-capture operations. Its Cape hake products and Australian prawns proudly bear the blue Marine Stewardship Council (MSC) logo – the gold standard for sustainability in the global fishing industry.

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