For the first time since 2000, SAN has fallen below $4.70.
This stock had found consistent and reliable support at this level many times over the last 3 1/2 years.
http://home.ripway.com/2003-11/39768/927548-SAN001.gif
Printable View
For the first time since 2000, SAN has fallen below $4.70.
This stock had found consistent and reliable support at this level many times over the last 3 1/2 years.
http://home.ripway.com/2003-11/39768/927548-SAN001.gif
Today is the record date for 9cps dividend too, so it is likely to be lower come Monday.
Regards JAMP
NZX: MCH MFT RBD SAN SKX SPN VTX WRI
UCM: KCE
OBV rising.
Kitty,
I'm not sure what time frame you are looking at when you say the OBV is rising - broadly speaking, it has been more or less level (trendless) all this year. Here is my take on the SAN/OBV relationship :-
http://home.ripway.com/2003-11/39768/SABobv001.gif
You can see that there have never been any "Class A" divergences (When Price and OBV go in opposite directions) inferring that institutions or other big buyers have not been taking any great interest in SAN - buying or selling. Note too that the OBV is still in negative territory. In the absence of any clear divergence or trend, the OBV is not much help to us here, in my opinion.
Phaedrus and Kitty, I can't confess to knowing what an OBV is...so perhaps I should be posting into the other Sanford thread.
Following a recent purchase (16Jun04) at $4-60, I have averaged down my holding in SAN. With the shareprice having broken the previous support level of $4-70, is it your expectation that this will now become a level of resistance?
Regards JAMP
NZX: MCH MFT RBD SAN SKX SPN VTX WRI
UCM: KCE
Jamp,
That's correct - a support level, once broken, commonly becomes a new resistance level. Commonly, not invariably.
I have no expectations - all I know is that Sanford is looking weaker now than it has in quite a while. Even if you take the optimistic view that the trading range is continuing, this stock has gone nowhere for over 2 years. During this time many NZ stocks have made significant gains.
So you have just bought - maybe you were feeling lucky, maybe you have picked the bottom to perfection, maybe you know something that others don't, maybe something fundamental has changed, maybe you are a true contrarian. Good luck to you - SAN owes you a drink or two.
Lookat all dem double tops (and the subsequent dips) on Phaedrus' first chart! Sheesh.
Luckily SAN doesn't really owe me anything - I have only been with them since Apr04.
The one certainty in their industry is that things will change. I do believe that they are well positioned to;
a) roll with the punches when the change is for the worse
and
b) move forwards when the change is for the better
As an aside, if SAN push north of $4-70 will this become a support level again?
Regards JAMP
NZX: MCH MFT RBD SAN SKX SPN VTX WRI
UCM: KCE
SAN looking pretty weak at the moment
Overall market doing remarkably well but SAN sinking to leveks not seen since the turn of the century
With little demand at current even the listed low p/e is not attractive
Wonder what is going on?
Don't know, but whatever it is, it has been going on since mid 2001!
Notice how nicely and accurately the support SAN had at $4.70 became resistance, once this long-term support level was broken.
New support levels at 4.20? Or is the SP going to keep freefalling after the cuts in the Hoki qouta and future qouta cuts telegraphed by the beehive. The fishing sector is desperately in need of some consolidation and new ideas.
Bring on GPG! [}:)]
I don't know how accurate the supposition of a support level at $4-20 for SAN is, but the earlier flagged resistance level of $4-70 has reared its head again.
Pleasing to see that the newly opened Auckland Fish Market has landed at least one of the industry heavyweights. Has anyone had an opportunity to look around the market perchance?
Regards JAMP
NZX: MCH MFT RBD SAN SKX SPN VTX WRI
Unlisted: KCE SUB
Not many support levels below 400
Uncharted waters now
I purchased 500 at 4.30 not long ago, just to dip my toes in water so to speak, would love them to plummet, (he says sniffing a bargain) May take a while but every dog has its day !
My buy finger has well and truly been twitching on this one.
I transferred funds from my bank account on Monday morning (before work) with the intention of buying more SAN on Tuesday. I didn't find out about Access Brokerage being in liquidation until Monday evening (after work) by which time it was too late to cancel the funds transfer.
Right about now I would rather have my funds drifting on the open sea with SAN than freezing in the BNZ vault.
Regards JAMP
NZX: MCH MFT RBD SAN SKX SPN VTX WRI
Unlisted: BRK
Pity about the bad timing on your funds transfer Jamp
You are keen about picking the bottom of SAN aren't you ... do you see that much value in them?
Maybe should join the ATR fan club instead
Although there are certain divergences between some volume based oscillators and price, it does not mean that a bottom has been reached. You really have to wait for price action to confirm.
How low is too low....I certainly wouldn't be jumping in just yet!
Jamp - hope things work out for you re Access.
Rgds
My first day back in employment too after being unemployed for longer than anticipated. It nearly put a dampener on the day, but not quite.
I will just have to hope that the share price stagnates until such time as my funds are freed up (always the optimist). In nature I am a little contrarian, so at the moment I feel this has me stamped all over it. No guarantees that we have seen the bottom, but as soon as my bait arrives I am happy to sling it on my hook, dangle it over the side and see what happens.
Regards JAMP
NZX: MCH MFT RBD SAN SKX SPN VTX WRI
Unlisted: BRK
Gotta be happy the first day back is a Friday :DQuote:
quote: Originally posted by Jamp
My first day back in employment too after being unemployed for longer than anticipated. It nearly put a dampener on the day, but not quite.
Sideshow
Jamp. For me the last buy signal was at the end of July followed by a sell 10 days later with a 2% loss. Sorry about the funds to Access debacle.
I'm with Stockman on this one - not yet.
The fishing industry seems beseiged at the moment, a lack of skilled workers, a strong dollar, foreign competition for a diminishing resource. With such natural advantages NZ should have two or three world recognised brands listed on the NZX. Add to this the governments lack of traction in sorting out aquaculture regulations and the situattion is not good. What's needed is government guidance, Jim Anderton should stop setting up superboats and superbanks and set about taking away the barriers to creating a fertile environment for a sustainable fishing industry.
As for SAN. This an important month for SAN technically during a time of real weakness in it's shareprice. At 3 year lows and still with considerable selling pressure. There seems to be some historical resistance @ approx 3.50 then I guess the NTA. After that well the reserve bank might have driven another company to the wall. One thing is certain when we get below 4$ SAN will become a takeover target for sure.
Been up every day since it hit that 400 ..... you been buying Jamp??
I have been thinking about buying Sanford shares for over 3 years but everything (and I mean everything) I read about the fishing industry from all around the world shows fish stocks of all spieces on the decline . Today I read that English fisherman had a quota of 800,000 tons of sandeels (sound tasty don't they) last year but could only catch 300,000. Are NZ's fish stocks in a similar state or are they sustainably managed? In the last 3 years Sanfords price has fallen (along with world fish stocks). Are Sandford shares really worth buying?
It's quite difficult to tell, as this stock moves quite a bit on very little volume. However, the last week of action doesn't really inspire much confidence imo.
from what i gather from mates who work on sealord boats they cant catch the quota allowed for hoki this year anyway,and theres definately a major decline in the stocks out there
Here is most of the article from the BBC online.
UK seabirds' breeding attempts in 2004 have been disastrous, the Royal Society for the Protection of Birds says, with industrial fishing largely to blame.
In a report the RSPB says 2004 has been the most catastrophic breeding season on record for seabirds along UK coasts.
It says industrial fishing to supply fish meal and oil is barely sustainable and imperils the whole marine food web.
The RSPB says climate change is making matters worse, with some industrial fish species starving as the seas warm.
Total failure
Industrial fishing catches millions of tonnes of small fish which congregate in dense shoals - species like sandeels, sprats and anchovies - to turn into meal and oil, much of it to feed farmed fish.
The fish caught are a key part of the marine food chain, but the RSPB says we know little about the effects of industrial fishing. But it is worried: "The UK has suffered serious seabird disasters this year already. In Shetland and Orkney, entire colonies of birds failed to produce any young because of severe food shortages.
"On top of that, hundreds of seabirds have been washing ashore having perished at sea. Again, lack of food is thought to be one of the reasons."
The report, Assessment Of The Sustainability Of Industrial Fisheries Producing Fish Meal And Fish Oil, was compiled for the RSPB by Poseidon Aquatic Resource Management Ltd and the University of Newcastle-upon-Tyne.
It investigated the sustainability of two of the world's largest fisheries, the Peruvian anchovy industry and the North Sea sandeel fishery.
It concluded that industrial fisheries globally are failing to meet crucial criteria for sustainability, with the sandeel fishery deficient on around 60% of the criteria tested.
winner69, my funds have not yet been released from the Access Brokerage fiasco. Needless to say I feel like I have missed the boat on this one.
Regards JAMP
NZX: MCH MFT RBD SAN SKX SPN VTX WRI
Unlisted: BRK
JAMP
Missed the boat. You should feel like the guy who missed the Titanic!
I cannot understand why anyone would contemplate investing in an industry that is doomed, unless the world accepts a near zero quota, for sufficient time period. Surely, until that happens you cannot get rich! Refer to above posts.
If you are a trader, you may have brief successes. Refer to your TA!
Basically fish is sustainably managed in NZ, (apart from odd hickup ie Hoki) so in long term this would put SAN in a better position than its international rivals. Main concerns are:
- current profitability (lack thereof) as take out FOREX gains and result is poor
- lack of security of tenure over marine farm assets, while govt bumbles along with proposed rule changes.
Sanford shares are up 50 cents in 2 weeks and 17 cents today. Today there were two annoucements.
1) The purchase of Suminovich.
2) Investing in China.
1) Sanford finalising purchase of fishing assets of Simunovich
Sanford Limited is in the closing stages of arrangements to purchase most of
the fishing assets of Auckland based fishing company Simunovich Fisheries
Limited.
These assets include fishing and scampi quota, vessels, equipment, workshop
facilities and other operational assets. Operational personnel associated
with these and other assets will be offered ongoing employment in similar
positions within Sanford Limited but some senior positions will be lost.
It is expected that this purchase will be completed and be effective from the
new fishing year commencing on 1 October 2004 and that it will prove highly
complementary to a broad range of Sanford's existing activities.
These include inshore longline and trawl fishing in the northern area for
species such as Snapper and Tarakihi which will further enhance the supply of
product to the newly opened Auckland Fish Market.
The hoki, orange roughy, and other deepwater quota species will be a used by
our existing deepwater ice and freezer trawlers and freezer longliners.
Simunovich's and Sanford's scampi operations will be integrated. From the 1
October 2004 the management of this resource changes from Olympic style
fishing (the disruptive race for fish with all the negative quality, market
volatility and over capitalization issues) into individual transferable quota
fishing where area quotas can be harvested in a much more efficient manner
maximising quality and vessel usage and supplying the market in a more
orderly fashion.
2) Sanford invests in China
Sanford Limited has concluded a 25% investment in a wholly foreign owned
seafood processing company in China.
The company Weihai Dong Won Foods Limited (WDWF), based in Weihai in the
north eastern part of the Shandong province is majority owned by Dong Won
Fisheries Co Limited of Korea but has other Korean shareholders as well. The
Sanford investment is part of an increase in the capital of the company from
US$5m to US$7.2m and coincides with an expansion of WDWF's already extensive
processing facilities.
This investment is part of Sanford's long term strategic goals of securing
the full benefits through a limited seafood supply chain into high value
worldwide seafood customers.
Weihai Dong Won Foods Limited was established in 1998 to meet increased
demand for new seafood products in Japan and elsewhere. The company sources
various seafood raw material products from New Zealand and elsewhere as well
as purchasing seafood locally in Shandong province. It processes that
seafood into more highly valued finished products which is then exported to
various countries around the world.
Sanford's investment will allow it to participate actively in the growth and
development of the business as well as enabling us to offer our customers
more specialized processed seafood products in one of the most competitive
economies in the world.
Sanford's decision to proceed with this investment was further encouraged by
New Zealand's recent recognition of China as a market economy and the
resulting steps towards a New Zealand/China comprehensive free trade
agreement.
Sanford has previously contracted the plant to process products caught in
other areas of the world and has always been impressed with its strong
emphasis on quality and efficiency. We are excited by the opportunities that
this equity investment offers us.
Sanford and Dong Won operate the San Won Limited Coldstorage business in the
port city of Timaru which has a sister city relationship with Weihai. Sanford
also charters three Dong Won fishing vessels in New Zealand.
Dong Won Fisheries Co Limited was established in 1970 and is listed on the
Korean Stock Exchange. For further information see www.dongwonfish.co.kr
Sanford is New Zealand's only publicly listed fishing compan
Oracle, with the benefit of hindsight I can "categorically" state that industry rationalisation was always going to happen. This was signalled when they tried to merge with Sealords. To my mind there is more to come, and when it does the cream will rise to the top.
The good news is that the BNZ should be in contact with me within the week to clarify (and release?) my call funds with Access Brokerage. Perhaps a fortnight or so too late to park them where I had intended, but at least they are homeward bound.
Regards JAMP
NZX: MCH MFT RBD SAN SKX SPN VTX WRI
Unlisted: BRK
So, did the Sanford chart predict today's "breakout"?
And if not what's the point in doing these pointless charts?
MVT
When T.A. signals are propitious I react. I don't try to predict and I believe that it's one of the tenets of effective T.A. (just as F.A.'ers who don't understand T.A. are reactive.[:p])
MVT, I will attempt to answer,but only if you promise one thing: you try to be objective[:p].Quote:
quote:Originally posted by Major von Tempsky
So, did the Sanford chart predict today's "breakout"?
And if not what's the point in doing these pointless charts?
TA is a tool, exactly like FA, to aid in a decision making process. TA can not predict future prices - neither can FA. I use FA and TA to stack the odds in my favour when trying to make a profit.
I mentioned on the 18/9/04 that SAN can move quite a lot on very little volume. There certain indicator signs, but nothing compelling to make me want to rush in. SAN is a stock I have no interest in.
Anyway, tell me, did your statement of financial performance, el nino weather patterns and cash flows predict todays 'breakout'? [?]
MVT - Why have you gone all quiet[?] If you are going to make haughty comments, and someone takes the time to respond, I would have thought that even you would have the decency to reply.
I obviously gave you more credibility than you deserve. :(
MAJOR VON TEMPSKY, You said [did the charts predict todays rise in the share price]. The charts will never predict a rise like this happening, but fundamental inside information will. We live in a crooked world, the charts showed that something untoward was happening,and it did. FA at a distance would never spot it, unless you were close to the operation but TA did. Two announcements with the market reaction in advance,or to put it bluntly insider trading. Perhaps MAJOR you might see past the tea leaves off chartists. The herd starts to gallop before most of us hear the shot. When it comes down to straight out inside trading watch the charts. MACDUNK
DISCL 60pcFA 40pcTa is what i do.
I have no interest in SAN so didn't notice any price rise ahead of the announcements. So, MacDunk and others, if you did notice something fishy (sorry, pun not intended) why haven't you raised the matter with NZX? A simple phone call or email will at least prompt some sort of response. I've done this a couple of times over things that bothered or puzzled me and each time I've received a prompt and courteous reply. It all helps to keep them on their toes, IMO.
MVT,
TA thinking disguised as FA : If a company has bad managers and doesn't make money, it is likelyto go bust. (You could illustrate this on a chart if you wanted to - management quality versus earnings or whatever - would it then be mysterious and require tea leaves for proper interpretation?)
TA (one example): If a share price has fallen to a certain value but no further many times in the past it is likely to fall no further this time. If it does fall further this time (ie. breaks support)it is very likely to keep falling.
Not a difficult concept to grasp really. This was Phaedrus' point in his original post for this thread.
LAWSO, Knowing we live in a stupid corrupt world suits me. I understand what happens and use it to my advantage. When a chart starts to react in an odd way i think wait for me and climb aboard. Incidentely i have a son in law that works for one of the companies mentioned and was informed a couple of weeks ago about likely outcome. When its all over the price will continue to drop. DISCLOSURE NIL SHARES HELD macdunk
Monday 8 November 2:16 PM
NZ's Sanford f'casts yr profit to rise 12-14 pct
WELLINGTON, Nov 8 (Reuters) - New Zealand fishing company Sanford Ltd. (NZSE: SAN) said on Monday it expected annual profit to rise up to 14 percent, despite a flat first half result.
"With the inclusion of contributions from asset sales, foreign exchange hedging gains and reasonable trading results in the second half of the year, it is expected that the final result will be approximately 12-14 percent ahead of the result for the 13-month period last year," the company said in a statement.
The company posted a net profit of NZ$47.3 million last year and a flat first half profit of NZ$23.7 million, as large foreign exchange gains helped to offset lower export sales.
Sanford, New Zealand's only publicly listed fishing company, would release its annual result after the market closes on Nov. 25.
Shares in Sanford, which changed its balance date last year, last traded up five cents at NZ$4.40.
In October, Sanford said it would pay NZ$137 million to purchase assets of privately owned Simunovich Fisheries.
What they don't say is: "Take out profit on asset sales and FOREX hedging, and we had a really awful year" suppose we just have to wait to see full extent on 25 November.
The market has responded positively to the announcements of late in the short-term.
I will be watching with interest how things stack up following the profit announcement post-market closure on the 24th. Will the recent share-price gains hold or will we see the stock sold off again?
Regards JAMP
NZX: MCH MFT RBD SAN SKX SPN VTX WRI
Unlisted: BRK
This chart update provides a picture-perfect textbook illustration of Support, when broken, becoming Resistance. The reversals that you see here are accurate right to the cent, even though they have been spread over 4 years. The market has a long memory.
Note that the big rise on Friday carried SAN above the crucial $4.70 resistance level.
http://img.photobucket.com/albums/v4...456/SAN001.gif
Jamp, Only my opinion might be wrong but i know a little bit about the industry. In the short term profit will increase because of the scampi fishery recently purchased hense the rise in share price. The long term it is a different story. Over fishing reduced catches long term i think the outlook is not to good. The scampi fishery at the moment is a money makeing machine the other part is on decline. macdunk
I agree Macdunk
I'v worked in the fishing industry for a few years and i can assure people that this industry is in serious decline - To put it simply, there's not enough fish out there to catch.
Rising fuel prices is just another nail in the coffin of the fishing industry.
Mick
It must be the contrarian within I guess. There are a few storm clouds brewing, but somehow I don't believe that we have all the necessary components for a "perfect storm".
Supply issues are not going to go away, so there is no point in the industry burying their head in the recently dredged sand and thinking they will. I guess that leaves the other side of the equation, demand. Do we see a shift to the next best product (essentially leaving S&D curve unchanged), or do we see a new supply curve with equilibrium moving up the demand curve?
Regards JAMP
NZX: MCH MFT RBD SAN SKX SPN VTX WRI
Unlisted: BRK
Must be another thread somewhere for SAN but this is the only one when searching
However announced result late afternoon, headlines -
Group profit declined from $26.1m last year to $19.7m this year; however, the
profit decline would have been substantially greater had we not earned a
capital gain of $7.6m from the sale of our investment in Argentina and a
$2.2m gain on the reversal of our 2005 write down of our Canadian investment
in Fishery Products International Limited (FPI). The underlying result from
the main business activities was impacted by the continuing high New Zealand
dollar exchange rate and rising fuel prices.
Doesn't look too bad until you see the impact of the capital gains - which sort of says that the profit this year would have only been $9M odd without y=them
Nearly $400M of sales and stuff all profit must be frustrating for all .... all that hard work in smelly working conditions (at least for the workers) for not much profit but at least shareholders get 13 cents a share .... just as well as the capital gains eh
Highlights the fragility of NZ exporters and the impact of the high dollar and their inability to compete with the rest of the world when it is high .... and the ever increasing cost of fuel is a double whammy
Consensus might be that both could improve but another year of struggling for SAN if the NZD doesn't fall and their is some fuel cost relief .... at least management seems reasonably comfortable
Amazed that the SAN shareprice has stayed up as high as it has over the years .... still about where it was 3 years ago and not that many exporters can say that
Unfortunately the dollar hasn't been anywhere near US 60c this year, the low point was more than US 66c.
http://uk.ichart.yahoo.com/z?s=NZDUSD=X&t=1y
I'll bet you're glad you hung fire there, Tobo. 6 months later and the downtrend still hasn't ended! There is some news, though..... Yesterday SAN released their 6 month report - profits are down by 79.4%. This must have come as a surprise to some holders because the shareprice has dropped another 19 cents since then. SAN's weakness is no news for TA users, though. For them, this is simply the continuation of a pre-existing confirmed downtrend that has been running for over a year, so far.
In spite of SAN being a relatively lightly traded stock, this chart provides some nice clear illustrations of simple, kindergarten level TA in action. Note the (unsustainably) steep uptrend. See how the break of the confirmed trendline gave a very timely Sell signal, locking in profits. This signal confirmed the OBV trendline break Sell signal that had preceded it by several weeks. The OBV is supposed to be a "leading" indicator, firing ahead of price action and that is certainly what happened here.
The magenta trendline marking the subsequent downtrend was broken in early 2009, but see how this "buy" signal had no volume confirmation. The OBV was not rising. Those who understand the importance of volume would have ignored this signal.
Look now at the uptrend of early 2009 as marked by the light green trendline. See how this uptrend continued to lack the confirmation of a rising OBV - In fact, the OBV was falling - this uptrend had no future. It ended after a few short months, beginning the current downtrend which has run for over a year, so far.
Note the surgical precision with which the peaks of this downtrend fall on the trendline. Neat eh? I never cease to marvel at just how linear trends can be.
http://i602.photobucket.com/albums/t...sPB/SAN527.gif
Lessons :-
(1) Don't buy downtrending stocks.
(2) Don't act on any single unconfirmed signal.
(3) By the time the company reports the bad news that "explains" the fall, it's too late.
(4) Don't buy downtrending stocks!
Thanks, Phaedrus..
Another fine tutorial!
SAN would be on a lot of watchlists I would think - it's on mine - and the recent weakness in the NZD might have tempted some buyers. A good example of the value in overlaying a bit of basic TA over fundamentals.
Good stuff Phaedrus, I was looking at SAN yesturday and was going to ask you to post a chart on them. Being a kindergarten level TA this has definatley helped. Cheers
A thing of beauty!
(Not the price if you are a holder, but the clear and present story told by this chart.)
Thanks, Ph.
I guess it wasn't TOO much of a surprise, as it had already dropped near $2.
But you've got to think that if an established business is valued purely on it's earnings, 80% drop on earnings could theoretically be reflected by an 80% drop in sp.
Based on the advise below, I believe Sanford is about to embark on a serious program to combine all their various recent aquisitions and exisiting operations into a streamlined and well managed operation. I believe this will include younger and fresher management taking on bigger and more important roles in the near future, which is a positive. With Hoki quotas expected to increase significantly over the next 3-5 years combined with significantly increased quota holdings through aquisitions, Sanford will need to invest in upgrading its catching and processing resources and they have a history at doing so at very good prices. Hopefully they will repeat this again BUT they need to make sure they invest in world class equipment. If they do, I would hope this company will go from strengt to strength in the next few years.
Discl: Hold SAN
Sanford Moving Forward
For some time the Board of Directors have been reviewing the development options for the future growth of Sanford Limited. While having been generally satisfied with the results over the last few years and have continued to support growth both by acquisition and direct investment they believe it is now time to start looking at new ways of going forward. Examples of acquisitions and investment include the Jones Group assets, the NIMPL expansion, the Bluff Salmon farm expansion, the Sealord mussel farm purchases, the new inshore vessel San Hikurangi and the expansion of mussel opening technology at Havelock. They remain concerned that we are still subject to significant outside influences that determine our performance. While exchange rates is a significant influence it is not the only one and they believe it is now time to put in place management strategies that build further on our strengths and fundamentally examine the way in which we transact our business from the ocean to our customers in a way that continues our leadership in sustainable seafood. We need to examine our products and processes and our systems of determining what are the best markets and channels to those markets and what product form maximises value. For some years we have struggled to earn our cost of capital and the only way to improve that is to lift our earnings and/or reduce our capital.
The Board has approved a revised management structure that will reduce the number of direct reports to me and allow me to focus on reviewing and developing the 10 or so strategic relationships we have with various companies. At the same time and on a more regular basis these three new roles will expose the Board to senior management tasked with moving the company forward.
Consequently from 1 January 2011 a new structure will be put in place with three direct reports to me.
Those roles will be:-
General Manager Operations
This role will cover all operating divisions of the business. It will include Inshore, Deepwater, Aquaculture, Pacific Tuna, China, and Industry Liaison roles. Division or existing Managers will report through the General Manager Operations position.
Greg Johansson will be appointed to this role and this will involve him relocating to Auckland and a new appointment to the role of Deepwater Division Manager based in Timaru will be made as a consequence of this.
General Manager Marketing and Development
This role will cover all marketing (including the appointment of a marketing team leader), quality management, product specifications, logistics, plus responsibility for Australian activities. It will also take responsibility for the formation of a product innovation and development capability that will look at developing more efficient, effective and sustainable ways of meeting customer requirements.
Vaughan Wilkinson will be appointed to this role which will involve him relinquishing responsibility for the Pacific Tuna and Industry Liaison roles but taking on responsibility for Australia and leading the new product innovation and development capability.
General Manager Finance and Administration
This role will cover all finance and banking, sustainability systems, secretarial and quota administration, accounting and IT systems, insurance, ACC and superannuation and executive support systems. Further development of our software systems and coordinating the expansion of our website and converting it to multi lingual will be an early focus of this role.
Dean McIntosh will be appointed to this role which will also require him to mentor with others in similar roles in similar sized companies.
The establishment of these roles is intended to strengthen the structure of the business and the existing executive will continue to meet with the same attendees and reporting as occurred in the past. These changes in no way diminish the roles or responsibilities of the Division Managers and they and I will continue to interact on a regular or as required basis.
If you have any queries or questions on this email please contact myself.
Kind Regards
><(((☺>
Eric Barratt
Managing Director
This story about Sanford's use of slave labour to catch their fish is an absolute disgrace and very dangerous to NZ's good reputation for ethical food production and thus NZ Inc.
Whistleblower in hiding after 'slavery' storm
Orginal Businessweek story:
Slaves Put Squid on U.S. Dining Tables From South Pacific’s Cruelest Catch
I will not be investing in Sanford until the current management and fishing practices are changed. Blaming and pursing the whistleblower is bad management in the extreme.
Yes this is a bad story Jaa and I find the initial response from the CEO very unfortunate. It is unacceptable for Sanford to be involved with any companies that behave like has been suggested in the Bloomberg story
However, the story is not about "Sanford's use of slave labour". The vessel which is at the center of this story has never worked for Sanford but the crew member who is rightly making the claims, did work on a Sanford associated vessel some years ago and has claimed some serious mistreatment happened onboard there as well. Claims that need to be investigated and the truth discovered ASAP. Sanford has had independent observers on all their associated foreign charter fleet for 10 years now and it is incomprehensible that this can happen while they were onboard. If the claims are proven correct, then the observer program has miserably failed, which would be a bad mark against Sanford's management.
I will wait for all sides of this story to come out before making any decisions on continued investment in Sanford. My experience with Sanford is of very capable management who take their responsibilites seriously and operate openly and honourably.
Below is a link (I hope it comes out Ok as I never seem to be able to post them correctly) to a recent article by Gareth Morgan which injects some reality into the discussion about use of cheaper labour in NZ.
http://www.gmi.co.nz/news/1342/outrage-at-foreign-fishing-fleet-hypocritical.aspx[/URL]
Discl: Hold SAN
I propose that all wages for foreign chartered fishing vessels be paid into an account under the control of an independent body for forward disbursement to the crew.
This would give an accurate record of what has or has not been paid and be used to settle wages disputes. It would enable NZ authorities to check payments against pay contracts that the crew sign and are required to be submitted to the authorities. This body should also have the power to act on the behalf of crew to obtain unpaid wages, and act against breaches of the Truck Act
BVoop boop de do
Marilyn
That is basically what the Government announced yesterday MM. From now on all wages/salaries will need to be paid into a NZ bank account in the name of the individual crew member and under his/her full control. This will ensure that pay rates are easily monitored. But of course there are still issues with what happens once these guys get back to their often very corrupt countries, but that is something the NZ Government or NZ companies can not control. The Government has also announced 100% observer coverage on all foreign charter vessels, something Sanford has been doing voluntarily for 10 years. Both rules are steps in the right direction.
Hopefully the changes requiring all fishing quota vessels to NZ flaged wiil bring some stability and respectability to the fishing industry.
One of the spin-offs I hope to see is introduction of new vessels into the fleet. If these vessels have on-board sale ready processing so much the better.
http://www.stuff.co.nz/business/indu...to-new-zealand
Boop boop de do
Marilyn
Just curious, why does Sanford barely rate a mention on these forums? Is it considered a bit of a dog?
Not an exciting growth company I suppose. I brought it at what I thought was a decent yield and have done little since then. Old management were disparaged but they focused on quota. New mgmt. focusing on customers but buying dodgy boats and selling some quota in Tauranga which in my uneducated and possibly ignorant opinion would always be a bad idea. Quota is what makes a fishing company attractive in my opinion. The only intangible asset that will always be worth something unless the govt change the system.
The thread below probably took over any Sanford discussion.
https://www.sharetrader.co.nz/showth...hlight=sanford
Hope you are coping with the Covid-19 crisis OK, your earlier posts although prescient did come across as overly negative but it is good to see they have lightened up a bit.
I have recently started buying some Sanford. Small stakes but enough to encourage me to start reading up.
PE of ~12, 3.5% dividend and generally free cashflow.
I really like the spread of markets they sell into. solid 40+% to NZ and they rest pretty evenly spread around the world.
Does anyone hate it and why?
Good discussion. This is a strong company in an industry that will come out of this crisis better than most.
I disagree that they made a mistake when selling the quota in Tauranga. It was mackerel and some low value tuna quota and several outdated purse seine vessels that have never made money for SAN and would have required significant investment if it was to be successful. They also had a few of these vessels up in the Pacific and sold them as well.
The current CEO has been totally changing the direction of the company with a view of increasing value per kg caught and I think this has been a commendable goal. He has hugely increased local NZ sales to the top end restaurants of town and overseas, particularly with salmon, but also other species such as snapper and scampi. He's also done a great job with the changes at the Auckland Fishmarket. But like the rest of us, he did not foresee COVID-19 and the drop in demand from high end restaurants, so that strategy is backfiring a little.
Sales in this industry are basically shutting down of high end products going direct to restaurants in NZ, Australia, China, US and Europe while commodities such as fillet block is in high demand by supermarkets and, in my view, will only increase during this crisis. As an example, I'm on a large factory vessel that produces a commodity product and we have Japanese buyers guaranteeing they will buy whatever we can produce and prepay it as we catch it.
So the industry will remain strong and come out of this and SAN will be able to adjust, but their strategy of higher value may need to take a back seat for some time.
I have made my view of their recent (2-4 years) vessel purchasing decisions clear in previous comments, on the other thread I think. They have been appalling and caused me to sell my SAN shares a couple of years ago. They need to get their act together in this part of their business as they are running an outdated fleet and factories that require large investments. But they haven't given any confidence they know how to do this.
The drop in the FX rate recently will be a big boost for them. A few years ago it was talked about that a drop by 1c in USD rate equaled NZ$ 1m extra revenue pa for SAN. They now sell much more in NZ/Aus so I don;t know if this still holds true.
But overall a good strong company in a good industry with a CEO that I think sees what needs to be done. But so far his results have been a little disappointing.
Discl; On my watchlist but not tempted to buy just yet
Thanks Iceman.
Just got lost in their 162 page annual report. Seems they have complex USD hedges and commodity swaps for the fuel oil might minimise the immediate benefits from the most recent low oil prices. Definitely help them in the future though.
Always end up down a rabbit hole in the annual report footnote and appendices. Really like the KPI charts but pretty disappointing that lost time injuries are at a 5 year high, they need to sort that out.
Tried to find out how much they sell to restaurants but it is not broken out in the report. Again another company that is hard to assess the impact of COVID19.
Lots of good info today, will add them to my watch list. Nearly bought a few on the big meltdown day last week, wish I had now,but was wary of going in blind. Had skimmed over the fundamentals and thought they looked ok, but that was about the extent of it. Am sure there will be other opportunities in the not too distant future.
Many restaurants will go to the wall, and if this drags on they will have very few customers even when the lock down is over. This is situation I like as generally buy with a Ten year time frame, and the cheaper it gets the better.
No funding problems to worry about? Iceman mentioned the fleet a little sub par. If you took restaurants completely out of the equation would they still turn a profit on the supermarket stuff alone?
Definitely no funding issues. Very lowly geared. To find the answer to your 2nd highlighted question you just need to go back to Annual Reports from 2017 or before to find the answer. Since then they've made big changes to their marketing strategy but little change to fleet or factories.
Yes, many restaurants will go to the wall but many others will start up when this is all over. And fish dishes will be as popular as ever!Quote:
Many restaurants will go to the wall, and if this drags on they will have very few customers even when the lock down is over. This is situation I like as generally buy with a Ten year time frame, and the cheaper it gets the better.
:)
Still learning about the business. Iceman reckons the vessels might have some issues so thought I might do a lay person check.
Hard to know who to compare it too but Sealord might fit the bill, slightly smaller revenue overall but seems a close competitor.
Both have about the same number of deep water vessels.
Sanford have an average age of 1989, Sealord have average of 1990 but that is heavily skewed by the two ukranian beasts from the 1970's. If I exclude the 2 oldest from both fleets then Sealord average age is 1996 vs Sanford 1991.
Would I be correct in assuming newer vessels are generally more efficient, need less crew and have less repairs required?
I realise it is expensive but perhaps they need to have a long term vessel renewal plan in place?
The brand new $70 Million Sealord one looks like a epic unit. Hopefully less injuries and a happier crew as well.
https://www.sealord.com/nz/newsroom/...new-home-town/
Dont hold me to it but tables below.
Built Capacity cubic m Sealord FV OTAKOU 1989 130 Sealord FV THOMAS HARRISON 1989 180 Sealord FV AUKAHA 1997 390 Sealord FV OCEAN DAWN 1991 560 Sealord FV REHUA 1997 660 Sealord FV WILL WATCH 1972 530 Sealord FV TOKATU 2018 1300 Sealord FV MERIDIAN-1 1991 1200 Sealord FV PROFESOR MYKHAYLO ALEKSANDROV 1970 1200
vs Sanford
Built Capacity cubic m Sanford San Waitaki 1990 940 Sanford San Enterprise 1990 940 Sanford San Discovery 1992 940 Sanford San Aspiring 2001 725 Sanford San Aotea II 1993 515 Sanford Albatross II 1984 35 Sanford Christmas Creek 1981 25 Sanford Drysdale 1986 35 Sanford Venture K 1985 40
Saw a few photos from when I was looking up the details and I am no expert but the older ones are pretty terrible looking.
Good accurate summary Waikaka. Vessels built today according to owners of new vessels I have spoken to is that they are around 50-70% more efficient than 20 year old vessels, including huge reductions in emissions and much less cost per Value Per Unit Effort
The last 4 vessels on your list for SAN are their scampi vessels that fish parts of the year in the Southern Ocean. This is not only stupid on these vessels but also very dangerous. SAN is planning an urgent replacement of them.
The 2 above it are their toothfish vessels that are also up for replacements, at least one of them. They fish in an olympic (competitive) quota fishery in the Antarctic and are being left behind by newer and much better vessels from Norway and other countries.
But the big need for change is in the inshore fleet which is so old and outdated that it is not possible for SAN and the CEO to achieve the increased quality and freshness he is aiming for with this pathetic equipment. This is now holding back his plan called "focus on fresh", which in any case has now been held back by the huge change caused by COVID.
Another side issue is that it has become impossible for SAN to hire good young people on their vessels. That will not happen until they are more up to date with good accommodation and crew comfort and constant high speed internet connections.
The industry has seen the change this has made in both Iceland and Norway when they made a major upgrade to their fleet in the last 5-10 years, all of a sudden young people became interested to make this a career again.
Not a terrible briefing,
http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/SAN/351240/320303.pdf
I still cant find out how much of their trade goes to restaurants but hopefully most can be redirected to retail customers, without too much hit to margins.
"Sanford says $20m 'marine extract' facility will create 30 jobs in Marlborough"
https://www.stuff.co.nz/business/117...rlborough?rm=m
There have been some pretty good - informed comments in the section but I think its been a bit generous in terms of current management. The fleet is a mess, they have sold quota (only to find out they needed it and have had to lease it back at exorbitant premium) and are investing in a vertical integration program which they have no experience in.... great industry but lack of focus in terms of core business is going to hold them back.
lower profits and reduced dividend , wont be the only company reporting these type results
From the SAN half year report;
"The projects we have underway in our diverse fishing division, both inshore and in the deep sea fleet are going well, but they are substantial undertakings requiring significant investment of capital, time and expertise and therefore require our patience as we tackle the move from commodity to added value, species by species."
Buenos días Iceman, would you care to comment?
Boop boop de do
Marilyn
I don't really know what they are referring to as they haven't made any announcements that I've noticed. But I heard a little rumour that they have signed a deal to build replacement scampi vessels in Holland. I've seen some of the requirements they put out for tendering for them and am underwhelmed. Their last couple of vessel purchases have been disasters as has been discussed on this thread and I fear they are once again making a mistake when selecting new equipment. Cost savings seem to have a higher priority than anything else, which is not the wisest thing to do when selecting new machinery to last you for decades. I thought they had learnt from the last 2 stuff ups.
No idea what else they are doing but as I have stated on this thread, their toothfish vessels need replacing soon and I suspect the lack of performance in this fishery for SAN this year may be partly due to other operators having much better vessels to compete in the Ross Sea's olympic fishery.
I find the result on the whole underwhelming/disappointing.
I watched a program called the "Price of Fish" yesterday. It discussed the quota management system and pointed out the people of NZ don't get any return from it, although it is supposedly protecting the resource for all NZ. It also pointed out the level of dumping going on and generally was critical of the quota management system. I am actually sympathetic to many of the issues raised but am torn as the quota system is what makes my investment in Sanford so secure.
It also reinforced how bat **** crazy management were selling quota of any species under the current system. There might be a better system but it will probably impact poorly on my safe Sanford investment.
I guess Covid-19 has shown even conservative investments such as AIA, SKC and the property companies face risks. Rio Tinto has unsettled shareholders in the power companies, although they will still make money.
No point to be made just wondered if anyone else saw it. Didn't watch to the end as they seemed to harp on the same themes.
It was sent to me Aaron but due to my travels and bad connections at the moment I could not watch it all properly.
As you know, I am involved in the fishing industry but dlsclose I have no financial interest in the NZ industry at present. NZ and Iceland have a very similar QMS (Quota Management Systems) that are quite different from most other countries. These 2 countries introduced their systems for the exact same reason. Trying to stop overfishing and making fishing sustainable for fish stocks and other affected species (birds, dolphins, sharks etc etc).
Both of these countries have been vastly more successful with those goals than any other countries I know and I've worked under about 10-15 different systems.
The biggest argument I hear in both countries against the systems is that some people have been very successful at it and made good money. My view is that many people were making big money before these systems were introduced. There is nothing wrong with that.
I am not saying at all that the system is perfect, but I have not seen anywhere around the World, systems that manage access to this resource better than NZ and Iceland.
If people want to demand change, they need to say what is the better alternative.
One of my criticisms of quota management is how little the benefit of privileged access to quota given to Maori has trickled down to the ordinary Maori joker struggling to keep his family feed.
Boop boop de do
Marilyn
SAN closing its Tauranga fish factory with the loss of 65 jobs. One wonders how much this site is worth for them to sell, but probably not a lot with all the derelict and unsafe buildings.
This completes they're withdrawal from Tauranga after selling the pelagic operation a couple of years ago.
I've also heard that they have sold their Australian hoki and orange roughy quotas to Talley's which, if true, is a decision I do not understand.
Happy to remain on the sidelines with this one and am starting to question where the management is heading with it all. They've said all the right things but I see very little action to back up the big goals.
https://www.nzx.com/announcements/357447
Whatever it is - markets not happy with Sanford these days. Not quite sure yet, whether this is Sanford shares on special or whether this is just another iteration of a dropping knife on no news.
However - I recon it won't take long for us to find out ... today is the day!
This is a very bad announcement. COVID has put the brakes very hard on their policy of aiming miost of their production to higher value customers such as restaurants around the World. The high value has become very difficult to sell with large price drops. Commodity products into supermarkets is where the market is today.
https://www.nzx.com/announcements/359084
No doubt - there will be accumulation opportunities ahead if the market should overreact :);
How many years will Corona related restrictions impact on the revenue (and income) stream? Right.
Interesting though that our top wine producers (who basically sell to the same clientele) didn't notice their revenues to drop due to reduced restaurant consumption ...
Discl: holding a (small) position and ready to accumulate at the right price;
CEO leaving. A big surprise. Very short notice and clear he has been pushed. . As I’ve said on this thread for awhile now, SAN's management has made some very bad decisions in the last couple of years and not really making any traction towards the ambitious goals Volker set. Maybe time for a big clean out in management to change the direction !
Maybe they realised how much quota he was selling and needed to stop him selling an extremely valuable intangible asset. Quota they will never get back which they could have leased. I imagine it has taken years for Sanfords to slowly buy up quota and now it is gone. I say this with very little understanding of the business but can't for the life of me figure out why he would sell any.
Covid-19 would have also put a dampener on the sales to high end restaurants.
Agree Aaron. That as well as very bad decisions on vessel purchases with FV Granit and the plastic inshore trawler they bought from Canada. The former has been a total disaster with around $12-15 million (my estimate) spent on it so far and a budget request for another $12-14 million just to try to get it up to scratch. Still catching appallingly. That will take this old heap of ****e up to $60-65 m and they would never sell it for more than $20-25 m.
The plastic ****e they bought from Canada was so badly designed that it never even got licensed to fish in NZ and was quietly written off.
I fear their preliminary (MOU only as far as I know) decision on scampi replacement vessels is of similar quality.
Discl: Happy to be out
Is it possible that some future re-thinking on the quota system might lead to a revaluation, downwards, of this asset? After all, NZ First may not be around the corridors of power to protect the fishers' interests for much longer!
Disc: Not holding SAN.
That would affect SAN and other industry players in a big way, depending on the changes obviously.
But I can not see that happening and why should it ? In my view NZ and Iceland have the best fisheries management systems in the World. To a large degree, they have managed to do what they set out to do when the QMS was introduced, sustainable fisheries management. No other countries have done it better.
Fair enough, iceman. I was thinking of the political aspect; the anti-fishing lobby that opposes the industry; the possibility of some tinkering that achieves little but appeases at the expense of quota holders.
Here is a link to an article which is positive about future prospects for Green Lipped Mussel farming and mentions Sanford in passing;
https://www.interest.co.nz/rural-new...deavours-green
Boop boop de do
Marilyn
A big downgrade and a terrible result. I'm glad I'm out. Hopefully they will announce soon who the new CEO will be and how they are going to reset the business !
SAN
05/11/2020 08:33
MKTUPDTE
PRICE SENSITIVE
REL: 0833 HRS Sanford Limited (NS)
MKTUPDTE: SAN: Update on 2020 Full Year Results
5 November 2020
NZX Continuous Disclosure
Update on Sanford 2020 Full Year Results
Sanford Limited (NZX: SAN) wishes to advise the market of certain key
unaudited metrics from its full year results for the year ended 30 September
2020. This is ahead of the release of its full results announcement on
Thursday 12 November, as previously communicated to the market.
Key unaudited metrics: Note 1
o Net Profit After Tax (NPAT): $22.4m, a 46% decrease on 2019 ($41.7m).
o Total Revenue: $468.8m, a 14% decrease on 2019 ($545.1m).
o Adjusted (underlying) Earnings Before Interest and Tax (EBIT): $38.3m, a
41% decrease on 2019 ($64.8m). Note 2
Our earnings reflect the ongoing impacts of the Covid-19 pandemic on
Sanford's sales channels, primarily to food service, as disclosed in our
market update on 2 September 2020.
This result is a continuation of the sales revenue trend which we advised the
market of in September. However, the fourth quarter profitability was
further impacted by the following factors:
o Poorer than expected wildcatch performance in September driven by a lower
than expected Patagonian toothfish catch.
o A lower fair value of salmon stock in water with expected future sales
pricing under pressure.
The result this year is disappointing, and our markets continue to be
challenging and difficult to predict because of the evolving Covid-19
situation. Despite this our cash collection remained satisfactory through
the year and our balance sheet is strong. We continue to assess and make
changes to re-position the business to be more adaptable and match our costs
to the new environment.
For information, please contact:
Fiona MacMillan
GM Corporate Communications
+64 (0)21 513 522
At least they show remorse :eek2: - They said The result this year is disappointing,
Seem to say that quite often