Sea Harvest says the rising global oil prices could weigh on margins, even as the fishing group reports a recovery in profits.
The warning comes as conflict between the US and Iran has unsettled global energy markets, raising concerns about supply disruptions and further price volatility.
CEO Felix Ratheb said fuel remains one of the biggest cost drivers in the business leaving the company exposed to volatility after the recent surge in oil prices linked to escalating tensions between the US and Iran.
“Fuel is a big cost driver in our business. And any movement in the fuel/oil price affects us quite a bit. The oil price has moved significantly since the events of the weekend,” he said.
Ratheb said the group will not speculate on the extent of the potential impact, saying that several variables influence operating margins. However, he made it clear that fuel exposure is material.
Fishing conditions, he said, have a greater influence on performance than fuel prices alone. Strong catch rates allow vessels to fill quotas more quickly, reducing time at sea and limiting fuel consumption.
“If catch rates remain strong, it negates the fuel impacts as you catch quicker and reduce fuel usage,” Ratheb said.
Sea Harvest on Tuesday posted a strong comeback, reporting a surge in full-year profits as higher hake catches and firmer prices boosted its core fishing business.
This marks a structural turnaround for Sea Harvest, with its core fishing operations driving a decisive recovery in profitability and positioning the group on firmer financial ground in the 2026 financial year.
The global fishing and food group’s operating profit for the year to end-December more than doubled to R1.3bn, up 125% from R580m the year before. Profit margins also improved, showing the business is earning far more from every rand of sales than in 2024.
Headline earnings, a key measure of underlying performance, climbed to R730m from R174m while basic headline earnings per share almost quadrupled, rising from 54c in the previous financial year to 219c.
Sea Harvest declared a final shareholder payout of 76c per share, more than triple last year’s 22c.
The recovery was driven mainly by a much stronger performance in the company’s hake division. The group said on Tuesday that catches increased during the year and demand remained firm in export markets, allowing the company to sell fish at higher prices. Lower fuel costs and tighter cost control further supported profits.
Revenue from continuing operations rose 20% to R6.6bn, helped by better volumes across most businesses and the full-year contribution from recently acquired operations in pelagic fishing and aquaculture.
Gross profit increased 35% while operating profit from continuing operations jumped 140%
Not all divisions performed equally well. The aquaculture business, which sells abalone largely into Asian markets, reported a loss as demand in Hong Kong and China remained weak and selling prices fell, Sea Harvest said. However, the Australian prawn business returned to profitability after a difficult previous year.
Stronger earnings allowed the group to reduce its debt by R417m to R2.25bn. The ratio of debt to earnings also improved, lowering financial risk and strengthening the balance sheet.
Despite the strong results challenges remain. The hake catch limit has been reduced for 2026 and a stronger rand could weigh on export earnings. Sea Harvest said Asian demand is also expected to continue affecting the aquaculture division in the near term.
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