Sea Harvests half-year revenues up 5% despite pandemic severely impacting aquaculture segment

SOUTH AFRICA- The Sea Harvest Group, a leading seafood and branded fast-moving consumer goods (FMCG) agri-business in South Africa, has posted strong half-year results despite headwinds experienced in its aquaculture segment. 

According to a statement from the company, group revenue for the period increased 5% to R2.1 billion (US$140 million) with headline earnings surging 19% to R202 million (US$13.95 million). Earnings per share increased 27% to 77.7 cents per share. 

 Sea Harvest noted that its half-year results were driven by “consistent performances” from its South African fishing segment, the Cape Harvest Food Group segment (which includes Ladismith Cheese) and its Australian operations. 

The company also benefitted from the extensive vaccination in Europe which gave more people the confidence to go out and dine.  

As a result of the reopening of markets particularly in southern Europe, Spain, Italy, Greece, and Portugal, “out-of-home consumption in our business has grown by 18% versus this time last year,” the company said. 

“We are pleased with our performance, considering we faced headwinds in the form of a 5% reduction in the total allowable catch in 2021, a stronger rand, additional Covid-19 related costs and operating pressures in our aquaculture segment,” comments Felix Ratheb, Sea Harvest CEO 

“However, we benefitted from good fishing conditions, firm export and local retail markets and a sound hedging strategy, delivering operating profit of R323 million for the period – 26% higher than the prior period – with the operating profit margin expanding to 15%.” 

However, the aquaculture segment, despite more than doubling its revenue, was severely impacted by the effects of Covid-19 on global markets, the group said in a statement. 

Ratheb noted that international air travel hasn’t picked up limiting the capacity available to take fish to the Far East from Johannesburg or Cape Town. “It’s very difficult to get the product in the market,” he added. 

With limited capacity, flight rates have also gone up. “Pre-Covid we were paying $4 a kilo to get product to Hong Kong. We’re paying $8 now. So it has doubled,” Ratheb revealed. 

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Moving into the next half of the year, Sea Harvest revealed that it is “anxiously” looking forward to the conclusion of the latest South African fishing rights allocation process, which is expected to be finalised in December this year.

Earlier, Ladismith Cheese, a wholly-owned subsidiary of the Sea Harvest Group acquired Mooivallei Suiwel. The group said the acquisition made in August adds significant cheese production capacity to the group. 

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