OCEANA REPORTS A SOLID OPERATIONAL PERFORMANCE UNDERLINED BY 49% GROWTH IN EARNINGS PER SHARE
Oceana Group Limited reported a 49% increase in earnings per share for the financial year ended 30 September 2008. Headline earnings per share improved by 46%. Operating profit before abnormal items increased by 34% compared to the prior year.
A final dividend of 130 cents per share was declared, bringing the dividend for the full year to 156 cents per share, an increase of 47% above the 2007 total dividend of 106 cents.
Commenting on inshore fishing operations, CEO Andrew Marshall said that profitability from canned fish was well above that of the previous year.
“Lucky Star canned fish sales were significantly higher due to our success in importing large volumes of product from a number of other countries. Suppliers of canned fish from Namibia were in line with the previous year while volumes from local canneries were lower.”
Glenryck Foods in the UK increased sales of canned pilchard although at lower margins due to procurement constraints while canned tuna volumes were lower but at better margins. “Overall,” said Marshall, “Glenryck profits improved considerably.”
Reporting on fishmeal operations, Marshall said that profits were lower. “Landings of anchovy and red eye herring at 120 263 tons were well above the previous year (97 884 tons), however reduced pilchard offal from the cannery resulted in overall production volumes being similar to the prior year. The average fishmeal sales price declined due to the impact of lower prices in the first quarter.”
Profits from the lobster business improved considerably. Marshall said that selling prices increased due to strong demand from China, the major export market for Oceana lobster.
“Higher squid catches, export prices and improved vessel performances resulted in increased profits. French fries performed well driven by strong volume growth, particularly in the quick service restaurant market, resulting in improved profits.”
Turnover increased by 14% in the horse mackerel business, despite the lower Namibian quotas, mainly as a result of higher volumes sourced from external vessels operating in Mauritania and higher prices in US dollar and rand terms. Oceana’s additional (third) Namibian vessel, acquired and refurbished at a cost of R72 million, commenced fishing in August. Profitability from horse mackerel operations improved.
Marshall said that hake operations showed an improvement mainly as a consequence of higher prices and the weaker rand exchange rate.
Reviewing cold storage, Marshall said, “The cold storage division experienced higher occupancies in most stores whilst non-fruit handling activity levels were in line with the previous year. Citrus volumes handled through the Maydon Wharf steri-fruit facility were significantly lower than the previous year. Overall profits from cold storage were similar to those of the previous year.”
Prospects: Considering future prospects, Marshall said, “The recent weakening of the rand exchange rate should benefit earnings going forward. Whilst prices of certain of Oceana’s export products are expected to reflect the impact of a general slowing in the world economy, this is unlikely to affect sales of more basic food products such as pilchard and horse mackerel which comprise the majority of the Group’s business.”
An improvement in earnings in real terms is expected in the year ahead.
13 November 2008
For further information contact: Oceana Group Limited:
Mbuyi Mtsheketshe, Group Corporate Affairs and Transformation Manager
Tel: +27 21 410 1400: Fax: +27 21 419 5979: e-mail: email@example.com