Sea Harvest expects full-year headline earnings per share (HEPS) to be as much as 47% lower due to challenges of historically low hake catch rates, geopolitical concerns in Hong Kong, and high interest rates in key markets.
In a trading update late on Wednesday, the group said
HEPS is expected to be between 53c and 58c, reflecting a 42%-47% decrease from a year ago.
Basic earnings per share are expected to be 27%-32% lower than the prior year.
In 2023, Sea Harvest recorded a one-off gain of R93m on purchased loans, contributing 34c to both EPS and HEPS. In 2024, the group incurred deal-related costs that shaved 7c off EPS and HEPS.
Adjusting for these, HEPS for 2024 is projected between 61.2c and 64.5c, a 2%-7% decline from an adjusted 66c in 2023, the group said.
Despite some headwinds, Sea Harvest saw 7% revenue growth in its SA hake fishing operations, driven by strong demand and higher selling prices. The pelagics business delivered a strong performance, while the dairy business remained resilient despite challenges linked to Foot and Mouth Disease, it said.
However, global market dynamics weighed on other segments. The Australian prawn business was affected by high inventory levels due to a global oversupply, which put pressure on pricing. Meanwhile, the abalone unit struggled with reduced demand from China’s weaker economy and geopolitical concerns in Hong Kong.
“High interest rates and high levels of debt in SA and Australia continue to weigh on earnings.”
Sea Harvest will release results on March 4.
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