Premier Fishing & Brands Releases Solid Annual Financial Results Despite Tough Market Conditions

31 October 2019, Cape Town – JSE-listed Premier Fishing and Brands Limited (Premier) announced its audited annual financial results to shareholders on 30 October 2019.

Highlights

  • Group revenue increased by 17% to R575 million from R491 million
  • Cash generated from operations for the period increased by 36% to R124 million from R91 million
  • Property, plant and equipment increased by 31% to R408 million from R310 million
  • Operating profit decreased by 10% to R83 million from R92 million
  • EBITDA increased by 3% to R112 million from R109 million
  • Premier declared a total dividend of 22 cents per share for the period ending 31 August 2019

One of the largest black-owned and managed fishing companies in South Africa, Premier delivered solid financial year-end results to 31 August 2019, despite tough economic and environmental conditions. The Group prides itself in being one of the most transformed companies in the fishing industry in terms of its management and employees.

It was a particularly challenging year for Premier as the Group experienced exogenous environmental factors such as a decrease of 44% of the Total Allowable Catch (TAC) of the West Coast Rock lobster as compared to the prior year; lower landings of squid, as experienced industry-wide; as well as the socio-political unrest in the Asian market, especially in Hong Kong, where Premier’s key clients reside.

The positive results were realised as a result of the consistent performances across most of the Group’s operating divisions with an increase in outputs, achieving better pricing, good catch rates, and efficient cost and vessel management.

Group revenue increased by 17% to R575 million from R491 million mainly as a result of increased sales volumes across all divisions. Cash generated from operations for year increased by 36% to R124 million from R91 million, revenue increased by 17% to R575 million from R491 million and the Group’s operating profit decreased by 10% % to R83 million from R92 million.

The Group experienced adequate landings for the lobster division as well as bigger size mix for south coast rock lobster (SCRL). The bigger size mix resulted in the Group achieving an increase in US dollar pricing for SCRL as compared to the prior period. The increased market prices resulted in this division maintaining its margin despite the strengthening of the Rand against the US dollar in the first half of the financial year.

Reflecting on last year, Samir Saban, CEO of Premier said, “I am delighted at the positive results and look forward to growing the business further, increasing business sustainability as well as increasing shareholder value”.

Premier also holds medium to long term fishing rights in west coast rock lobster, south coast rock lobster, small pelagics, hake deep sea trawl, hake long-line sword fish, tuna as well as squid. The group owns an abalone farm as well as one of the largest squid operations (Talhado) and invests in organic agriculture through the Seagro range of products.

Saban emphasised that the expansion of the abalone farm is in the final stages of completion and will produce approximately 400 to 450 tons of abalone per year once completed. This initiative is said to create 200 new jobs for those candidates who are members of the immediate community.

This is in line with the Group’s strategic growth plan to increase stakeholder and especially shareholder value and meet its strong global demand for our product. The expansion will also further provide additional direct benefits in the communities in terms of job creation.

The west coast rock lobster division, however, remains a challenge for the fishing industry overall. Premier contributes positively as an industry player to ensure that the west coast rock lobster resource remains sustainable for the foreseeable future.

Premier concluded the acquisition of 50.31% of the Talhado group during the 2018 financial year. As Talhado is one of the largest squid factory’s in the country, the deal is said to complement Premier’s diversification strategy and extend its product basket. The Group expects Talhado to contribute significantly to the operational performance of Premier, including synergies which will result in cost savings.

The catch rates for pilchards were, industry wide, lower than that of the prior year, resulting in lower landings and sales volumes of pilchards in the current year. Industrial fish catch rates were the same as those experienced in the prior year.
The successful platform of Premier and the performance track record over the past few years has placed the Group in a strong financial position to aggressively pursue acquisitions as well as improve its further organic growth strategies.

Majority shareholder, Group CEO of African Equity Empowerment Investments Limited (AEEI) and Deputy Chairman of Premier, Khalid Abdulla commented, “Despite the challenging market conditions, I am happy with Premier’s results for this financial year-end and wish to congratulate the Premier team on their efficiency as well as maintaining their focus on growth, development and sustainability. The growth plans for the fishing company are taking place in earnest and we look forward to the output and growth that this will generate in the future.”

The Board of directors announced a final gross dividend of 10 cents per share for the year ended 31 August 2019. This brings its annual dividends to 22 cents per share for the current financial year. The outlook for the Group is a positive one. Premier’s main strategic focus is currently on the Fishing Rights Application Process (FRAP) up for renewal during 2021. The completion of the abalone farm expansion and pursuing strategic acquisitions within the fishing industry and transformation, which is in line with its growth strategy.

Saban concludes, “The growth plans for Premier are taking place as expected, and we are excited about the next growth phase for the Group.”

Premier currently employs more than 800 people throughout the country and are creating additional jobs in the near future, to meet the company’s growth plans and empowerment targets.

ENDS

Premier is a diversified vertically integrated fishing group specialising in the harvesting, processing, marketing and sales and distribution of marine products. The company owns and manages its own factories, abalone farm, facilities and fishing vessels operating over three provinces. Premier’s product range includes south and west coast rock lobster, pilchards and anchovies, hake, squid, abalone and other products.

To arrange for an interview with Mr Samir Saban, CEO of Premier Fishing and Brands Limited, contact:

Feroza Petersen
Communications and Marketing manager
Tel: 021 427 1500
Email: Feroza@aeei.co.za | Web: premierfishing.co.za