Wrap Text
Sea Harvest Financial Results for the Year ended 31 December 2019
Sea Harvest Group Limited
Incorporated in the Republic of South Africa Reg no 2008/001066/06
JSE share codes "SHG" ISIN ZAE000240198
"Sea Harvest" or "the Company" or "the Group"
SEA HARVEST FINANCIAL RESULTS
for the year ended 31 December 2019
1. Key performance indicators
YEAR YEAR
ENDED 31 ENDED 31
DECEMBER DECEMBER
CHANGE 2019 2018
Revenue (R'000) 54% 3 966 452 2 583 341
International revenue mix (%) 44 58
Gross profit (R'000) 40% 1 270 815 908 244
Gross profit margin (%) 32 35
Operating profit (R'000) 54% 599 580 388 619
Operating profit margin (%) 15 15
Profit for the period (R'000) 35% 395 513 293 133
Weighted average number of shares (WANOS) ('000) 276 366 249 202
Headline earnings (R'000) 48% 410 417 277 899
Basic Headline earnings per share (HEPS) (cents) 148.5 111.5
Dividend per share (cents) 13% 45 40
Special dividend per share (cents) 5 -
Net asset value per share (cents) 879.2 705.6
ZAR: Euro average exchange rate1 16.09 15.73
ZAR: AUD average exchange rate1 10.04 9.81
Closing share price (cents) 1 455 1 375
1 Average spot exchange rate at which sales were recorded.
2. Short-form announcement
Sea Harvest Group Limited has delivered a strong set of results with headline earnings for the year ended 31 December 2019 increasing 48% to R410 million
(2018: R278 million). Headline earnings per share (HEPS) increased 33% to 149 cents per share (2018: 112 cents) and earnings per share (EPS) increased 32%
to 149 cents per share (2018: 113 cents), after absorbing an 11% increase in the weighted average number of shares (WANOS) in issue during the period.
Group revenue for the year increased 54% to R3.97 billion (2018: R2.58 billion), benefiting from the annualised effect of the acquisition of Viking Fishing
and Viking Aquaculture on 2 July 2018 and the acquisition of Ladismith Cheese on 2 January 2019.
Gross profit for the year increased 40% to R1.27 billion (2018: R908 million) and gross profit margin contracted to 32% (2018: 35%) as a result of the
inclusion of Ladismith Cheese. The gross profit margin of the South African Fishing operation expanded to 36% (2018: 35%), benefiting from synergies
relating to the Viking Fishing acquisition.
The Group delivered operating profit of R600 million for the year, 54% higher than last year (2018: R389 million), with an operating profit margin held
constant at 15%.
Profit after tax increased 35% to R396 million (2018: R293 million), benefiting from the 54% increase in operating profit, offset by higher net finance
costs as a result of increased borrowings to fund growth.
The Group generated R768 million (2018: R551 million) of cash from its operations, utilised R861 million (2018: R501 million) in investing activities and
R252 million (2018: generated R423 million) in financing activities, ending the year with R229 million (2018: R782 million) of cash on hand.
The Group has declared a full and final cash dividend of 50 cents per ordinary share, comprising an ordinary dividend of 45 cents and a special dividend of
5 cents per ordinary share, in respect of the year ended 31 December 2019, a 25% increase on the dividend of 40 cents per share for the year ended
31 December 2018.
Sea Harvest Group is c. 83% black owned and is proud to have retained a Level 1 B-BBEE contributor status, with an improved score of 104.44 (previously
100.37). Driving transformation within Sea Harvest and the fishing industry more broadly is central to Sea Harvest's existence. The Group invests
significant resources in skills development, employment equity, supplier and enterprise development initiatives, as well as initiatives focused on job
creation and early childhood, youth and rural development. During the year Sea Harvest spent R307 million procuring goods and services from 532 small and
medium enterprises. In addition, the Group spent R37 million on various skills development initiatives and the Sea Harvest Foundation spent R4 million on
community-based projects, including the provision of bursaries, healthcare initiatives, early childhood development, donations and the support of youth
sports development.
Sea Harvest has continued to deliver its investment strategy of growing earnings through a combination of organic and acquisitive growth:
- On 2 January 2019, Sea Harvest concluded the acquisition of 100% of the issued share capital of Ladismith Cheese, further diversifying the Group's earnings.
- On 8 May 2019, Sea Harvest concluded the acquisition of the remaining 43.7% of shares of Sea Harvest Australia not already owned by the Group, strengthening
Sea Harvest's presence in Australia and providing a beach-head for growth in the region.
- Within Viking Fishing, good progress has been made in integrating the business, with synergies achieved driving margin enhancement in the South African
Fishing operation.
- Work has commenced on the expansion of the Diamond Coast Aquaculture abalone facility in the Northern Cape. Two wind turbines at the Buffeljags abalone farm
have been installed, reducing the farms dependency on the grid and reducing its operating costs.
This announcement has not been reviewed or reported on by the Group's external auditors. The Group's auditors, Deloitte & Touche, have reviewed the full
announcement and expressed an unmodified conclusion.
This short-form announcement is the responsibility of the directors of the Group. It contains only a summary of the information in the full announcement
and does not contain full or complete details. The Full Announcement can be found at: https://senspdf.jse.co.za/documents/2020/jse/isse/shge/SHGYE19.pdf
Copies of the Full Announcement are also available for viewing on the Group's website at http://www.seaharvest.co.za/investors or may be requested in person, at
the Group's registered office or the office of the sponsor, at no charge, during office hours.
Any investment decisions by investors and/or shareholders should be based on consideration of the Full Announcement, as a whole.
3. Cash dividend declaration
Notice is hereby given of dividend number 3. A gross and final ordinary cash dividend amounting to 45 cents per share and a gross and final special cash
dividend amounting to 5 cents per share in respect of the year ended 31 December 2019, was recommended on Monday, 2 March 2020, out of current earnings.
Where applicable, the deduction of dividends withholding taxation at a rate of 20% will result in a net ordinary dividend amounting to 36 cents per share
and a net special dividend amounting to 4 cents per share. The company will obtain the necessary South African Reserve Bank approval with respect to the
special dividend.
The number of ordinary shares in issue at the date of this declaration is 294 293 814.
The Company's taxation reference number is 9223/794/16/6.
Relevant dates in respect of the ordinary dividend and special dividend are as follows:
Last day to trade cum dividend Monday, 6 April 2020
Commence trading ex dividend Tuesday, 7 April 2020
Record date Thursday, 9 April 2020
Dividend payable Tuesday, 14 April 2020
Share certificates may not be rematerialised between Tuesday, 7 April 2020 and Thursday, 9 April 2020, both dates inclusive.
By order of the Board
JP de Freitas
Acting Company Secretary
Date: 2 March 2020 Sponsor: Standard Bank
Date: 02-03-2020 07:05:00
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