NZ King Salmon lifts annual earnings guidance on appetite for fish
By Paul McBeth
June 26 (BusinessDesk) - New Zealand King Salmon Investments expects annual earning to beat its offer document forecast on strong demand for its products and affirmed its projected profit for the following year.
Pro-forma operating earnings before interest, tax, depreciation and amortisation is forecast to be between $20.5 million and $21 million in the year ending June 30, up from the $19.2 million predicted in its October offer documents and ahead of $16 million a year earlier, the Nelson-based company said in a statement. The pro-forma operating earnings forecast exclude a $1.8 million gain from a settlement with a supplier announced last month, costs of $800,000 over the proposed relocation of salmon farms, and $2 million of listing expenses.
The earnings upgrade was "due to strong ongoing demand and continued positive fish performance," chief executive Grant Rosewarne said.
Last month the company said fish performance metrics from its peak summer period were in line with expectations, and when reporting a 52 percent gain in first-half profit earlier this year, King Salmon said it was on track to meet prospectus guidance.
The salmon farmer today said its board kept 2018 guidance for earnings of $22.4 million and net profit of $14.1 million, "based on current market demand and fish performance expectations".
King Salmon will report annual earnings on Aug. 25.
The shares last traded at $1.50, up from their $1.12 listing price in an initial public offering last October. King Salmon raised $70 million of which $30 million went to repay debt and fund future investment, with the rest paying existing shareholders who sold down their holdings.