Huon wrangles record salmon for 2x profit despite kingfish jailbreak
Health & Biotech
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Record size salmon and ocean trout have helped bolster Huon Aquaculture’s performance for the half-year, doubling its profit compared to the previous six months.
In its report to market today Huon (ASX:HUO) reported record average fish weight for their 2016 Year Class, up 9 per cent to 5.29kg, and put it down to improved diets and longer time spent in fresh water.
Profit for the December half came in at $27.6 million compared to $10.7 million in the June half.
However the December half profit was down 12 per cent compared to the $31.5 million result in the same half last year.
While Huon had a solid performance in its main harvests of salmon and ocean trout – its Yellowtail Kingfish have been harder to wrangle.
The company confirmed that $1 million worth of Kingfish made a jailbreak during a period of severe weather:
“The cause of the loss was not due to the design or integrity of the fortress pens but operational shortcomings which have since been addressed.
“The loss has delayed plans for the first harvest until late March but otherwise the trial is continuing as planned.”
Harvest over the past year was up 35 per cent, and continued strong salmon prices helped to drive revenues up 28 per cent to $170 million.
The shares fell 6c to $4.68 on Wednesday.
Increased production comes as a result of a targeted growth strategy, and push into Asian export markets which now take 29 per cent of the fish produced.
“As we expand the business I am confident that the agreements we are putting in place across Asia to lock in sale at premium price levels, will remove much of the uncertainty and volatility that is currently associated with our sales into export markets,” managing director Peter Bender told the market.
Mr Bender forecast harvest volumes of 24,000 tonnes for the year, with contracted export sales expected to increase above 65 per cent for the second half.