What NZ King Salmon's open ocean project would look like. Photo / Supplied
New Zealand King Salmon said its net loss came to $5.6 million in the six months to July, driven by small fish sizes.
The shortfall equals the previous first half's loss.
NZ King Salmon, the world's largest aquaculture producer of premium king salmon, said an unintended consequence of its previous model was smaller fish, and compensating restrictions on its harvest had negatively impacted on the result.
Fish sizes and operating profitability were restored from July.
The company said the effects of Covid-19 disruptions had been largely overcome with the exception of freight availability and cost.
Revenue came to $80.1m, up from $67.0m in the first half of 2021, reflecting clearance of excess inventory and a recovery in sales.
The company's operating EBITDA came to $3.3m, compared with $7.1m in the previous corresponding period.
Chief executive Grant Rosewarne said the company returned losses in its first four months, which were more than fully offset by closing out of excess foreign exchange contracts.
Rosewarne said for the month of June, the company went back to break even, followed by incremental gains in EBITDA in July of $1.3m continuing into the second half, with August at $1.6m.
NZ King Salmon expects harvest volumes in the second half of 2022 of over 4000 tonnes delivering what it said would be the usual premium prices.
"During Covid full year 2021 we refocused on NZ retail (with heavy price promotions) and developed additional fresh speciality and e-commerce business in the US, which helped get us through FY21," Rosewarne said.
"Now, in 2022, we have seen the return of the US food service sector whilst retaining the incremental fresh business to deliver improving returns."
In terms of future growth, a hearing has been set in Blenheim, the week beginning October 18 for the company's open ocean Blue Endeavour application, 7km north of Cape Lambert in the Cook Strait.
"This project has multiple benefits - an improved environmental outcome, increase in scale, reduction in operating costs, improvements in fish health and a lift in unit values," Rosewarne said.
If the application is successful, the company expects a a harvest in 2024.
"It's undoubtedly an exciting time for the industry as the future for salmon farming is in the open ocean," he said.
Shares in NZ King Salmon last traded at $1.42, up 2c.
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