Daybrook Fisheries fleet. (Photo Credit: Daybrook Fisheries)

New acquisitions boost Oceana's results

Oceana Group achieved higher benefits in the year ended September, which the firm attributed to the acquisition of the fishing assets of Foodcorp in February and the US-based Daybrook Fisheries in July.

The Group reported a 22 per cent increase year on year in revenue to ZAR 169 million (USD 11.8 million) during the analysed period thanks to volume growth across most sectors and improved pricing, bolstered by the effect of the weaker exchange rate on the export businesses.

Operating profit increased by 17 per cent over the period to ZAR 1.026 million (USD 72.1 million) from ZAR 880 million (USD 61.8 million) in the same period last year.

The Group’s executives consider that canned fish revenue growth has been achieved mainly through inflationary price adjustments, offset by a reduction in volumes in the SA domestic market which has been negatively impacted by continued pressure on consumer spending.

While sales and distribution costs have been managed more effectively, the effect of a weaker exchange rate has had a materially adverse impact on the cost of imported product. Notwithstanding these challenges, the division has maintained operating margins and improved operating profit for the period.

The South African fishmeal division has had a positive year. Current season landings of industrial fish to the Group’s fishmeal plants of 144,365 tonnes resulted in improved production efficiencies and lower cost of manufactured product. A total of 50,055 tonnes of this fish was processed at the newly acquired Foodcorp facility.

The Group informed that Daybrook landed approximately 215,000 tonnes of menhaden during the season owing to improved resource abundance and catch rates, exceeding each of the prior three years and five year average landings respectively. Fishmeal production yields were consistent with prior years while fish oil yields were marginally lower.

In South Africa, hake operations improved significantly due to a combination of increased volumes resulting from the Foodcorp acquisition, improved vessel utilization and higher catch rates. Sales volumes increased by 96 per cent on the prior year.

As to West coast lobster, its improved production mix aided by higher selling prices and a favourable exchange rate resulted in an increase in profits for the year ended September.

The Group’s executives expect the weakness in the South African economy to continue and that, globally, demand for fish protein remains robust and that their export businesses to continue to reap the benefit of a weaker exchange rate. 

Related articles:

- Oceana expands international operations through Daybrook Fisheries purchase
- Horse mackerel fishery negatively affects Oceana's results
 

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