Mareterram’s expansion plans are wholly mackerel
Health & Biotech
Health & Biotech
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A seafood smorgasbord isn’t quite complete without a bit of Spanish Mackerel according to Aussie fishmonger Mareterram.
Mareterram (ASX:MTM) already runs sustainable fishing operations for prawn, scallop and crab — and has now acquired licences and vessels from a West Australian mackerel fishery to diversify the business.
To fund the $5 million acquisition, Mareterram has raised $3.75 million selling shares at 25c each and will draw from a $2 million loan. Some $800,000 will be set aside for working capital.
The deal, covering two separate fisheries, will give Mareterram licences covering 30 per cent of WA’s mackerel managed fishery market. Operations are due to kick off at the start of the season next April.
The expansion was a natural progression, managing director David Lock told Stockhead.
“We have a significant engineering operation that maintains our fleet of 11 boats based out of Carnarvon and were looking for a growth opportunity that would allow us to leverage our land-based infrastructure while diversifying our products,” Mr Lock said.
As part of the deal, Mareterram will acquire two big vessels and three smaller boats known as dories.
They plan to consolidate operations onto one large vessel and sell off the surplus, targeting as much as 30,000 tonnes over the course of the season.
The wild caught fish will complement the rest of their seafood products caught off Shark Bay. They will be processed and distributed in existing facilities and caught with the same boats.
“The new products will fit straight into the distribution chain for domestic consumption,” Mr Lock said. “This was a product that is in demand and has a consistent price around Australia.
“We snap freeze our product within half an hour of being caught as opposed to other vessels who can have fish chilled at sea for up to ten days.”
Unlike prawn catches, which can fluctuate by up to 20 per cent by yield, Spanish mackerel was a stable catch, he said.
Mareterram shares were trading at 27c on Friday, compared to a range of 22c to 31c over the past year.
Their latest season saw increases in volumes of scallops and prawns — though lower grades of prawn.
Coupled with increased diesel and crew costs, the company forecast a decline in earnings on a comparable basis for the six months to the end of the year.
Mareterram made $4.5 million profit last year.