Wrap Text
Sea Harvest Unaudited Interim Results and Dividend Declaration for the Six Months ended 30 June 2026
Sea Harvest Group Limited
Incorporated in the Republic of South Africa
Reg no: 2008/001066/06
JSE share code: SHG
ISIN: ZAE000240198
"Sea Harvest" or "the Company" or "the Group"
SEA HARVEST UNAUDITED INTERIM RESULTS AND DIVIDEND DECLARATION
for the six months ended 30 June 2026
1. KEY PERFORMANCE INDICATORS
UNAUDITED UNAUDITED(1)
SIX MONTHS SIX MONTHS
CHANGE ENDED ENDED
KEY PERFORMANCE INDICATORS FROM CONTINUING OPERATIONS % 30 JUNE 2026 30 JUNE 2025
Basic headline earnings per share (HEPS) (cents) 14 97 85
Interim dividend per share (cents) (maiden) 24 –
Revenue (R'000) -6 3 293 099 3 485 512
International revenue mix (%) 63 65
Gross profit (R'000) -8 1 046 454 1 138 626
Gross profit margin (%) 32 33
Earnings before interest and tax (EBIT) (R'000) 2 547 356 535 941
EBIT margin (%) 17 15
Net finance costs (R'000) -18 108 578 131 667
Profit after taxation (R'000) 10 308 844 281 285
Headline earnings (R'000) 13 320 118 283 841
Weighted average number of shares (WANOS) ('000) -2 330 135 335 644
ZAR: Euro average exchange rate(2) -5 19.16 20.09
ZAR: AUD average exchange rate(2) – 11.61 11.65
ZAR: USD average exchange rate(2) -10 16.49 18.38
Net asset value (NAV) per share (cents) 2 1 264 1 242
Closing share price (cents) 4 851 815
Net debt to EBITDA(3) (times) 1.1 2.1
(1) Restated for the classification of the discontinued operation in accordance with IFRS 5: Non-current Assets Held for
Sale and Discontinued Operations. Information about the Group's discontinued operation is provided in note 7: Discontinued Operation.
(2) Average spot exchange rate at which sales were recorded
(3) Earnings before interest, taxes, depreciation and amortisation
2. SHORT-FORM ANNOUNCEMENT
Benefiting from firm global demand for sustainable seafood, Sea Harvest Group delivered solid results for the six-month period ended
30 June 2026, with HEPS from continuing operations increasing by 14% to 97 cents (2025: 85 cents) and net debt decreasing by
R560 million to R1.66 billion (31 December 2025: R2.22 billion).
The Group leveraged double-digit price increases, efficiencies, and disciplined cost control to mitigate significant headwinds in the
period including one of the weakest pelagic fishing seasons on record, a ban on fish trawling in the Pilbara in Australia, a stronger
exchange rate, lower hake total allowable catch (TAC), and material increase in the fuel price.
Notwithstanding, improved local pilchard catches, record fishmeal and fish oil prices, and a much-improved performance in the
Aquaculture segment resulted in Group EBIT increasing by 2% to R547 million (2025: R536 million), with the Group EBIT margin expanding
to 17% (2025: 15%).
The disposal of Ladismith to Fairfield Dairy Proprietary Limited was concluded on 30 April 2026, with the proceeds used to reduce debt.
Sea Harvest Hake delivered credible results despite significant headwinds including the 5% lower TAC, 9% lower hake catch rates
(albeit off a peak in 2025), stronger exchange rate, and higher average fuel price. Segment revenue increased by 7% to R2.1 billion
(2025: R2.0 billion), with the 4% lower sales volumes and 3% stronger exchange rate offset by strong global demand for sustainable whitefish,
resulting in sales prices increasing by 14% in real terms. Disciplined cost control and efficiencies, complemented by foreign exchange and
fuel hedge gains, contributed to EBIT increasing by 7% to R463 million (2025: R431 million), with the EBIT margin maintained at 22%.
Sea Harvest Pelagic experienced one of the weakest industrial (anchovy) fishing seasons on record, resulting in fishmeal and fish oil sales
volumes declining by 53%. The business was therefore unable to take full advantage of significantly higher fishmeal and fish oil prices, the
result of the persistent El Niño conditions that have severely curtailed global production. Segment revenue decreased by 19% to R711 million
(2025: R879 million) with the 30% decrease in sales volumes and stronger exchange rate offset by price increases of 15%. Strong local pilchard
catches, improved canned fish margins, and disciplined cost control partially mitigated the impact of the lower industrial fish volumes,
resulting in segment EBIT of R122 million (2025: R144 million, down 15%) at an EBIT margin of 17% (2025: 16%) – a firm performance in a
difficult period.
The Aquaculture business narrowed its loss before interest and tax significantly as a result of product and market diversification efforts
driving higher pricing, complemented by the cost reduction initiatives implemented since 2024. Segment revenue decreased by 18% to
R136 million (2025: R166 million) as a result of reduced sales of low-margin abalone products, lower abalone feed sales (following the closure
of certain local and international abalone farms), and the stronger exchange rate. Benefiting from ongoing cost rationalisation initiatives and
R23 million in fair value gains on biological assets (2025: R41 million in fair value losses), the segment narrowed its loss before interest
and tax to R13 million (2025: R39 million loss).
The Australian business was materially impacted by lower volumes as a result of the Pilbara fish trawl ban and a later start to the prawn
fishing seasons in Shark Bay and Exmouth. Notwithstanding the delay, prawn catch volumes increased by 20% compared to the prior period, displaying
good specie and size mix. Tropical cyclone Narelle tore through Exmouth in February 2026 causing extensive damage to fleet- (with one vessel
written off) and land-based infrastructure and resultant delays. The delayed start to the prawn fishing seasons and lower external engineering
activity resulted in segment revenue for the six months to 30 June 2026 decreasing by 30% to R317 million (2025: R455 million), with the decrease
tempered by firm price increases. To mitigate some of the challenges in the period, a second phase of cost reductions was implemented in H1 2026,
with the segment reporting a loss before interest and tax of R25 million (2025: EBIT of R0.3 million). Due to the seasonal nature of the business,
and with the loss of the year-round Pilbara fish trawl earnings, earnings are weighted towards the second half of the year.
Group revenue from continuing operations decreased by 6% to R3.3 billion (2025: R3.5 billion) as double-digit price increases across all businesses
were offset by lower sales volumes in the Pelagic and Australian businesses and a 3% stronger exchange rate.
Cost of sales decreased by 4% largely due to the reduced sales volumes, resulting in gross profit decreasing by 8% to R1.05 billion
(2025: R1.14 billion), with the gross profit margin at 32% (2025: 33%).
Other operating income of R133 million (2025: R137 million) included R92 million in net foreign exchange and fuel hedge gains (2025: R58 million)
and R28 million (2025: R25 million) in insurance income.
Benefiting from increased focus, operating expenses decreased by 6%, with selling and distribution, marketing, and other operating expenses well
controlled during the period.
Fair value gains of R23 million (2025: R53 million loss) related primarily to firmer pricing and an improved size mix in the Aquaculture business.
The Group mitigated the lower revenue base and cost pressures through firm price increases and disciplined cost control, resulting in the Group
delivering EBIT of R547 million (2025: R536 million, 2% higher), with the EBIT margin expanding to 17% (2025: 15%).
Net finance costs decreased by 18% to R109 million (2025: R132 million) benefiting from lower average interest rates during the period and lower
levels of debt following the proceeds from the Ladismith disposal in May 2026.
Profit after tax from continuing operations increased by 10% to R309 million (2025: R281 million).
Headline earnings from continuing operations increased by 13% to R320 million (2025: R284 million), while basic HEPS from continuing operations
increased by 14% to 97 cents (2025: 85 cents) and basic EPS from continuing operations increased by 10% to 97 cents (2025: 88 cents).
The Group declared a maiden interim cash dividend of 24 cents per share in respect of the interim period ended 30 June 2026.
Net debt (excluding amounts owed to non-controlling shareholders) decreased by R560 million to R1.66 billion (31 December 2025: R2.22 billion)
with the Group's net debt to EBITDA ratio improving to 1.1 times (30 June 2025: 2.1 times, 31 December 2025: 1.4 times).
OUTLOOK
Within Sea Harvest Hake, demand, particularly in key export markets, remains firm, and management continues to focus on pricing momentum,
market and channel optimisation, operational efficiency, and disciplined cost control to mitigate the impact of the 5% reduction in the hake
TAC, inflationary pressures, and the stronger exchange rate. The higher fuel price is expected to have a more pronounced effect in the second
half of the year, should current elevated oil prices prevail.
Within Sea Harvest Pelagic, elevated prices are expected to continue as a result of the global shortage in fishmeal and fish oil, providing
some mitigation to the record low industrial fish catch volumes and currency headwinds. The outlook in the canned fish business is uncertain
due to the potential effects of the Pelagic herpesvirus on the biomass.
In Aquaculture, management is encouraged by the positive impact of improvements in product size and quality, restructuring initiatives, cost
reduction programmes, and market and product diversification efforts, while improving demand and pricing provide a tailwind going into the second
half of the year.
In Australia, a strong start to the prawn fishing season positions the business well for the remainder of 2026. While the Pilbara fish trawl ban
presents challenges, the impacts are expected to be largely offset by higher prawn catch volumes and improved selling prices, ongoing
diversification initiatives, and a firm order book within the marine engineering division.
Following the disposal of Ladismith in April 2026, the Group remains focused on cost containment, margin enhancement, capital expenditure and
working capital optimisation, prudent capital allocation, cash generation, and further debt reduction.
Management remains committed to improving returns, strengthening the balance sheet, and positioning the Group for sustainable long-term growth.
The investments made over the last several years position the Group well to capitalise on market demand, stronger pricing, and cyclical improvements
in resource availability.
The board wishes to thank management and employees for their loyalty, dedication, care and professionalism in contributing to the success of
the Group.
The directors of the Group take full responsibility for the preparation of this announcement. This announcement has not been audited by the
Group's external auditors.
This announcement is a summary of the information contained in the full announcement and does not contain full or complete details. Any investment
decisions by investors or shareholders should be based on consideration of the full announcement as a whole.
The full announcement can be found at: https://senspdf.jse.co.za/documents/2026/jse/isse/shge/SHGHY2026.pdf
Copies of the full announcement are also available for viewing on the Group's website at: www.seaharvestgroup.co.za or may be requested in
person, at the Group's registered office or the office of the sponsor, at no charge, during office hours.
3. CASH DIVIDEND DECLARATION
Notice is hereby given of dividend number 10. A gross and interim ordinary cash dividend amounting to 24 cents per share in respect of the
period ended 30 June 2026 was recommended on Monday, 31 August 2026, out of current earnings. Where applicable, the reduction of dividends
withholding taxation at a rate of 20% will result in a net ordinary dividend amounting to 19.20 cents per share.
The number of ordinary shares in issue at the date of this declaration is 361 072 994.
The Company's taxation reference number is 9223/794/16/6.
Relevant dates in respect of the ordinary dividend are as follows:
Last day to trade cum dividend Tuesday, 6 October 2026
Commence trading ex dividend Wednesday, 7 October 2026
Record date Friday, 9 October 2026
Dividend payable Monday, 12 October 2026
Date: 1 September 2026
Sponsor: The Standard Bank of South Africa Limited
Date: 01/09/2026 05:05:00
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