Oceana growth offset by decline in Daybrook’s profit

OCEANA rose nearly 6 percent on the JSE yesterday after Africa’s largest black-owned fishing company reported a 9 percent increase in operating profit to R605 million during the six months to end March.

The group said the uptick was driven by an 18 percent rise in its African operations to R514m.

However, the growth was offset by a 23 percent decline in Daybrook’s operating profit to R91.4m. Oceana acquired 100 percent of US-based fishmeal and oil specialist Daybrook Fisheries for R4.6 billion in 2015, to increase its profile as a global player in the fishing industry. Daybrook’s revenue declined by 4 percent due to lower fish oil sales volumes.

Group revenue increased 2 percent to R3.63bn, primarily due to a 3 percent increase in revenue from African operations. Earnings per share increased 1 percent to 250.4 cents a share, while headline earnings per share was in line with last year’s 249.8c.

Oceana said it had decided to defer its decision on an interim dividend in light of the evolving impact of the coronavirus (Covid-19) pandemic.

Chief executive Imraan Soomra said the group had survived under difficult conditions.

“Our strategy of both customer and geographic diversification is paying dividends,” Soomra said.

“What has been critical in the Covid-19 environment is that our products are primarily consumed in-home, which has protected us from closures in the tourism and hospitality industries,” he said.

Oceana was positioned across several geographies, with fresh fish being in demand in Africa and Europe, pet food in the US, fishmeal in Europe, Africa and Asia, and canned fish in South Africa.

Soomra said Oceana expected the pandemic to have a negative effect on its hake and horse mackerel segment.

The horse mackerel, hake, lobster and squid segment reported a 9 percent growth in operating profit, driven by a strong performance from the horse mackerel and hake businesses.

However, the weakening of the rand would have a positive impact on the next set of results, given that Oceana was a net exporter in the second half of the financial year, Soomra said.

Oceana shares closed 2.22 percent higher at R0.92.