Lucky Star and hake sales lift Oceana earnings
The global fishing and food processing company reported revenue of R4.9bn, down 6% from the prior period, while operating profit remained largely unchanged at R665m.
Gross profit margin improved by 30 basis points to 28.1%.
The group declared an unchanged interim dividend of 110 cents per share.
Net debt declined significantly to R1.7bn, contributing to a R45m reduction in net interest expenses. Oceana’s net debt to EBITDA ratio improved to 1.1 times from 2.2 times in the prior period.
“Investing in our fleet and factories, paying down debt and controlling what we can has ensured resilience in this unpredictable environment,” said Oceana CEO Neville Brink.
Lucky Star delivers strong performance
Lucky Star Foods delivered a strong margin-driven performance during the period, selling 5.1 million cartons and slightly exceeding the previous record.
While canned fish sales volumes remained stable, strong demand contributed to a significant increase in canned meat sales.
Although global frozen fish supply constraints led to a sharp decline in canning production volumes in South Africa, operating profit improved due to lower imported fish costs, increased local pilchard landings and reduced logistics and storage costs.
African fishmeal and fish oil production volumes, however, declined significantly because of lower industrial fish landings and fewer pilchard trimmings from Lucky Star’s canneries.
Sales volumes in the segment declined by 90%.
Wild-caught seafood boosts operational performance
Higher hake catch volumes supported improved operational performance within Oceana’s wild-caught seafood segment.
The increase was driven by improved catch rates and fleet upgrades that enhanced vessel reliability and increased days at sea.
Sales volumes for hake increased by 10%, supported by strong European demand, favourable pricing and lower global white fish supply.
Horse mackerel sales volumes also increased by 13%, with South African operations benefiting from improved catch rates.
In Namibia, lower fuel prices and reduced quota usage fees helped offset weaker catch rates.
Industry-wide squid fishing conditions remained difficult, with declining catch volumes weighing on performance despite stronger European pricing.
Fleet investment and pricing key focus areas
Oceana said its South African and US fishmeal and fish oil businesses could benefit from tightening global supply conditions, including lower anchovy quotas in Peru and concerns linked to emerging El Niño conditions.
The group also noted that global demand for sustainable protein continued supporting seafood pricing, although rising fuel costs, freight expenses and rand strength remain risks.
To improve operational flexibility, Oceana has acquired a dual-purpose vessel capable of catching both hake and horse mackerel. The vessel is expected to become operational in January 2027 following refurbishment work.
“Following investments in assets and moves to reduce unpredictability in the business in recent years, Oceana is in a good position to capitalise on cyclical improvements in resource availability, market demand and stronger pricing,” said Brink.