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King Salmon first-half profit leaps 52pc

NZ Newswire logoNZ Newswire 28/02/2017 Jonathan Underhill

<span style="font-size:13px;">King Salmon has reported a 52 per cent leap in first-half profits to $8.7m and says it should hit its full-year profit target of $10m.</span> © Getty Images King Salmon has reported a 52 per cent leap in first-half profits to $8.7m and says it should hit its full-year profit target of $10m. New Zealand King Salmon, which listed last October after raising $70 million selling shares, has posted a 52 per cent gain in first-half profit and says it is on track to meet its prospectus target for the full year.

Net profit rose to $8.7m in the six months ended December 31, from $5.7m a year earlier, the Nelson-based company said on Wednesday.

Sales rose to $63.6m from $56.6m.

The company, which is 40 percent owned by Malaysia's Oregon Group, sold 3400 tonnes of gilled and gutted salmon in the first half, up 13 per cent from a year earlier, while export volumes climbed 19 per cent.

King Salmon's fortunes partly rest on the outcome of a proposal to relocate up to six of its salmon farms within the Marlborough Sounds to ensure they continue to meet environmental standards, a process the government announced in January was being put out for consultation.

"The first four months since listing have given us a good platform for future growth," said chairman John Ryder.

"We are positive about the future of the company and its global potential, and we are on track with our investment in new farm capacity and operational upgrades to support this strategy."

Of the $70m raised in the initial public offering, $30m was new capital to repay debt and fund investments while the remainder went to existing shareholders who sold down their holdings, including Oregon and Direct Capital.

The IPO attracted new shareholders including food investor China Resources Ng Fung, which acquired about 10 percent of the company.

On Wednesday Ng Fung director Wang Xin was appointed to the board.

King Salmon is projecting revenue of $130.1m in the year ending June 30, 2017, for a profit of $10m, compared to a $2.6m profit on sales of $114.1m in 2016.

The company will pay an interim dividend of 2 cents a share.

The shares last traded at $1.36 and have gained 24 percent since listing.

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