Argentinian losses push Sealord into the red, North Island Mussels stake for sale

Sealord, New Zealand's second-largest fishing company, sank into the red after crystallising a $46.9 million loss on the sale of its Argentinian unit last year and has since put its stake in North Island Mussels up for sale.

The Nelson-based company made a net loss of $44.3 million in the 12 months ended Sept. 30, compared to a profit of $3.5 million a year earlier, according to holding company Kura's financial statements, lodged with the Companies Office. Sealord wrote off $37.1 million from the sale, and incurred a further $9.9 million in operating losses.

Gross profit sank 23 percent to $75.3 million, on a 6.1 percent decline in revenue to $457.3 million.

Sealord, which is jointly owned by Maori tribal interests through Aotearoa Fisheries and Japan's Nippon Suisan Kaisha, took a $10 million charge against its Yuken business in Argentina in the year ended Sept. 30, 2012, before selling the business to local interests in August last year for an undisclosed sum.

In Aotearoa Fisheries' annual report, chairman Whaimutu Dewes said the result was disappointing to the Maori fisheries company.

"Aotearoa Fisheries as a shareholder is mindful of the original drivers that lead to the acquisition of Sealord Group Limited and we continue to monitor the group's strategy and its execution to make 2013 a one-off event," Dewes said in his report.

"Sealord is expecting a significant turnaround in 2014 and the Sealord board has approved a plan for profit for the year of $19.5 million, resulting in a profit contribution to Aotearoa Fisheries of $9.75 million," he said.

Sealord slashed its dividend payment to $2.6 million, which was paid in December 2012, from $16 million a year earlier.

As well as the loss on the Yuken sale, Sealord booked a $2.6 million provisioning charge on the closure of a joint venture and faced $1 million in restructuring costs.

Before its Sept. 30 balance date Sealord began the sale process for its North Island marine farm licences and its 50 percent stake in North Island Mussels, which it co-owns with NZX-listed Sanford.

"It's highly probable that the sale will take place in the next 12 months," it said.

(BusinessDesk)