NZK - NZ King Salmon

[Entrep]

BE decision should come this month. Let's gooooo!

[BlackPeter]

BE decision should come this month. Let's gooooo!

You need to find a better animation, if you really can't stop yourself.

A sinking ship would be much more appropriate.

[TheHunter]

Surprised this hasn't been mentioned already:

https://www.rnz.co.nz/news/country/4...o-road-closure

Noting Whangamoa road re-opened six days ago now.

[Balance]

Could be another bad year ahead for salmon & mussel farming in NZ :

https://www.nzherald.co.nz/nz/explained-coming-marine-heatwave-may-be-one-of-nzs-worst/EYMYOQR2X2U3HPA3WXFHFC3GDY/"This is something that's been ongoing for more than six months now in Auckland, Coromandel, Bay of Plenty, Waikato, Taranaki, Tasman and off the West Coast of the South Island, as well as in parts of the eastern Tasman Sea."

As of September 13, SSTs in New Zealand's six "climate regions" ranged from 0.6C to 1C above average, relative to the 1991-2020 long-term average.

"If we were to compare that with the same day last year, around the North Island, SSTs are two-tenths to six-tenths of a degree warmer – so it's a pretty concerning picture."

What happens next?

According to the latest guidance, the signal for marine heatwave conditions for the months ahead was even stronger than the state of play last September.

* SST - Soaring Sea Temperatures

[ronaldson]

This was not good news for both NZK and SAN. Pelorus Sound is looking stuffed in the longer term as there seems no prospect of a reversal to the warming trend. Fishing/Fish Farming is an industry which will bear the brunt of climate change and adaptions will surely be needed. Can NZK move fast enough to survive?

[Sideshow Bob]

https://www.nzx.com/announcements/399509

New Zealand King Salmon Investments Ltd (NZX & ASX: NZK) reports its financial performance for the six months period ended 31 July 2022 (1HY23). Key points include:

• We reaffirm full year earnings guidance given in April 2022 of an $8m - $12m pro forma EBITDA loss.
• Net loss after tax of $24.5m, following a challenging start to the year with sea farm mortalities, lower harvest and a decline in biomass at sea.
• Revenues are consistent with the prior comparable period (PCP) at ~$80m as a combination of price increases and customer mix have offset reduced sales volumes through 1HY23.
• Sales volumes decreased from 3,669mt in 1HY22 to 2,886mt 1HY23 (a decrease of 21%) consistent with the consequences of a reduced harvest.
• The mortality event in January 2022 continued into 1HY23 and increased mortality cost by $11.9m from $10.4m in 1HY22 to $22.3m.
• Pro-forma EBITDA for 1HY23 was a loss of $13.7m compared to profit of $3.3m for the 1HY22. This is predominately due to the mortality event affecting the first half of FY23, while 1HY22 included $13.5m of early forex close-outs included in other income.
• Finished goods inventories continue to be managed down sensibly following the build-up which occurred through COVID disruptions.
• Post the equity raise in May 2022 net bank (debt)/cash position has improved from a debt position of $44.1m on 31 January 2022 to a net cash position of $15.6m on 31 July 2022. In addition to cash on hand, NZ King Salmon has access to a $6.5m revolving debt facility which remains undrawn.

New Zealand King Salmon Chairman John Ryder said: “As previously indicated we had a disappointing start to the year because of high mortality and the cost of this was $22m for 1HY23. We then had to begin rebuilding our biomass and accordingly we restricted our harvest and sales. We introduced a number of cost-saving initiatives, and our financial performance has improved although there is more work to do. Our recovery progress is in line with previously communicated guidance.”
CEO Grant Rosewarne acknowledged it had been a tough start to the financial year, but the outlook was improving with price increases implemented across all markets. “We introduced our new aquaculture strategy as outlined at full year with three farms in the Pelorus already fallowed. We also made the decision to mothball our Waiau freshwater facility which is surplus to current requirements.”

“We successfully completed a $60.1 million pro rata rights offer and proceeds were used to repay debt which has left us with net cash of $15.6 million. We now have to rebuild biomass from 3,700MT back up to around 5,000MT.

“As outlined previously, we downsized the company, which was necessary to align with the reduced harvest, which was not an easy decision to make. We have been fortunate that there are a number of staff shortages in other businesses, so only 23 positions were made redundant as our business reduced from 580 team members to 452, largely through attrition,” Mr Rosewarne said.

“We sensibly reduced capex and we are forecasting capex spend of $6.5m to $7.5m, compared to $13m last year. Much of the capex relates to pre committed projects, such as a new barge and net cleaner and work on our Blue Endeavour application.”

“Along with introducing price increases across all markets, we have made improvements to our customer and product mix, and we have reduced our promotional budget. There has been a large focus on supply and demand this year following a reduced harvest. Our strong markets remain North America for Ōra King and domestically our Regal brand remains New Zealand’s most preferred smoked salmon,” Mr Rosewarne added.

Recent media articles have indicated the potential for another marine heatwave this summer. The change in our aquaculture model is designed to provide strong mitigation against the effects of warmer temperatures.

“The hearing for our open ocean Blue Endeavour application, 7kms north of Cape Lambert in the Cook Strait, was formally closed at the beginning of September and a decision is now expected by the end of the year. This project is expected to have multiple benefits including increase in scale of operations, reduction in operating costs and improvements in fish health.”

Blue Endeavour would provide an opportunity to recommence farming at three of the fallowed farms in the Pelorus Sound, which will be used as nursery sites for 9 months of the year, avoiding the summer months with fish being transferred to Blue Endeavour at ~1.5kgs for full grow out to ~4.2kgs average weight. This represents an efficient use of assets, capital, and resources.

The application is aligned with the Government’s Aquaculture Strategy which was launched in late 2019 and now has an accelerated objective of the industry achieving $3 billion revenue by 2030. Ends

[Recaster]

Had a brief look at and update of this business:

https://recastinvestor.substack.com/...mon-nzknzx-a93

[winner69]

Did it all become a bit too hard for Grant or did Grant become a bit of a problem for the Board

CEO leaves today

http://nzx-prod-s7fsd7f98s.s3-websit...476/382295.pdf

[Sideshow Bob]

Did it all become a bit too hard for Grant or did Grant become a bit of a problem for the Board

CEO leaves today

http://nzx-prod-s7fsd7f98s.s3-websit...476/382295.pdf

Leaving the day it is announced...........hmmmmmmmmm

[Balance]

Did it all become a bit too hard for Grant or did Grant become a bit of a problem for the Board

CEO leaves today

http://nzx-prod-s7fsd7f98s.s3-websit...476/382295.pdf

Ominous for Blue Endeavor?