NZ King Salmon lifts earnings outlook
New Zealand King Salmon Investments expects annual earnings to beat its offer document forecast on strong demand for its products and affirmed its projected profit for the following year.
Pro-forma operating earnings before interest, tax, depreciation and amortisation are forecast to be between $20.5 million and $21m in the year ending June 30, up from the $19.2m predicted in its October offer documents and ahead of $16m a year earlier, the Nelson-based company said. The pro-forma operating earnings forecast exclude a $1.8m gain from a settlement with a supplier announced last month, costs of $800,000 over the proposed relocation of salmon farms, and $2m of listing expenses.
The earnings upgrade was “due to strong . . . demand and continued positive fish performance”, said chief executive Grant Rosewarne.
Last month the company said fish performance metrics from its peak summer period mirrored expectations, and when reporting a 52 per cent gain in first-half profit earlier this year, King Salmon said it was on track to meet prospectus guidance.
The salmon farmer yesterday said its board kept 2018 guidance for earnings of $22.4m and net profit of $14.1m.
King Salmon will report annual earnings on August 25.
The shares last traded at $1.57, up from their $1.12 listing price in an initial public offering last October. King Salmon raised $70m of which $30m went to repay debt and fund future investment, with the rest paying existing shareholders who sold down their holdings.