NZK - NZ King Salmon

[IAK]

Not a good look from a company that wants to do the best by the environment. Selling contaminated burley throughout the country.
"MPI's investigation found several breaches of its biosecurity management plan, and that the company failed to follow best practice for preventing the spread of disease."

http://www.radionz.co.nz/news/nation...eadly-bacteria

[peat]

I recon the outcome will be quite digital.

binary ?

[BlackPeter]

binary ?

Well, there might be more than 2 options (fully consented, partially consented, consented with conditions, declined), but not much more ...

[King1212]

Good result!! I always knew NZK will do well as I am in hospitality business. But I refused to invest....

[RGR367]

Good result!! I always knew NZK will do well as I am in hospitality business. But I refused to invest....

Yeah, that 114 price paid at IPO day is no longer expensive. Bought then as I just love salmon most especially when it's sashimi But CEO resigning to join Petuna Seafoods took some glossiness off from the report.

[JeremyALD]

Any thoughts on this one? Cracked through the $2 mark for the first time and has gone up nearly 100% since IPO

[BlackPeter]

Any thoughts on this one? Cracked through the $2 mark for the first time and has gone up nearly 100% since IPO

In principle good industry, however the company has some environmental spots on its vest and there are some political risks.

From memory - their current farming places are suboptimal (not enough water flow to remove all their sewage (or however you call the mix of salmon droppings and unused fish food), as well as water a bit too warm). I understand that there are proposals out to offer them more suitable places in the Sounds instead, but don't think that this is yet a done deal. Didn't follow over the last half year or so since I sold out, but I think iwi was not that happy about the proposals and (depending on who the incoming government is) I could as well imagine some other political issues.

http://www.guardiansofthesounds.co.n...n-epa-inquiry/

I am sure there are as well contrarian views (like from the company , but the following recommendation might be worthwhile reading for investors ... always good to know what the risks of an investment are:

https://www.mpi.govt.nz/dmsdocument/...l-presentation

They talk about high fish mortality (the highest in the industry) and lots of environmental problems.

DYOR - most of that is based on some fading memories, but for my feeling are there at this stage some quite significant risks for speed bumps coming up.

[James108]

I had a brief look and value metrics compared unfavourably to a similar company in Norway. So I stopped digging. There could still be value in here though..

Key point is their 'earnings' (including biological transformations) does not reflect their cashflow. Also I think the most recent year they have had below trend fish mortality, a reversal to the mean could impact earnings, there is a study for scottish salmon showing fish mortality is generally higher than NZK achieved (I dunno how applicable that is to NZ salmon though).

[macduffy]

I'd be careful about comparing NZK product to Norway's salmon. I understand that NZK farm Chinook salmon, the premium stuff. Don't know about Norway's or the Scottish products. I was sceptical about this float, like most here, but must accept now that it was an opportunity lost!

[Chessboxin]

I'd be careful about comparing NZK product to Norway's salmon. I understand that NZK farm Chinook salmon, the premium stuff. Don't know about Norway's or the Scottish products. I was sceptical about this float, like most here, but must accept now that it was an opportunity lost!

Indeed there is a noticeable difference. King (Chinook) Salmon is produced in far smaller numbers than Atlantic Salmon & is considered the premium species. I am aware of certain supermarkets in NZ selling imported Norwegian Salmon, there is a noticeable difference in taste & texture.

From a product point of view, NZ Salmon is among the best in the world.