Shares in fishing group Sea Harvest were up as much as much as 6.5% in early trade on Friday after the group said it expects to report a 60% rise in earnings at the interim stage.
The main drivers of the expected increase were improved catch rates, higher international prices and efficiency gains in its SA fishing business, it said.
The group, valued at about R3bn on the JSE, said in an updated trading statement its headline earnings per share (HEPS) for the six months to end-June would be at least 60% higher than the 50c it reported a year ago.
By market close the share price had pulled back a little to end the day up 2.5% to R8.20.
The group will report first-half earnings on September 2.
Business Day reported in May that Sea Harvest’s abalone business remained under pressure due to the sluggish Chinese economy, with demand in its most critical export market muted.
While prices had been stable, the volume of abalone exported to China had fallen short of expectations, weighing heavily on the aquaculture division’s performance, CEO Felix Ratheb told Business Day.
China, along with Hong Kong, has long been Sea Harvest’s biggest market for abalone, a premium product regarded as a luxury item. However, economic uncertainty in the region, worsened by a slow post-Covid recovery and instability in the Chinese property sector, has led to subdued consumer sentiment and lower discretionary spending.
“China has not bounced back the way we expected,” Ratheb said, adding that the world’s second-largest economy was still under pressure and that affected the abalone category.
In its 2024 annual report, the group said abalone sales to the Far East had faced a series of headwinds since 2019, including geopolitical unrest, pandemic-related disruptions, and now broader economic softness. The group also noted the risk of increased competition from Australian prawns, which could further reduce market share and demand.
Sea Harvest is working to open new markets and build stronger relationships with food service players and retailers globally, particularly around the provenance and sustainability of its wild-caught Australian prawns.
With Nompilo Goba
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