NZ Salmon cuts loss

Press, 16 December 1988, Page 19

NZ Salmon cuts loss

PA Dunedin New Zealand Salmon Company’s net operating loss of $3.7 million for the year ended September 30 reflected the impact of Cyclone Bola, the board chairman, Mr lan Farrant, told shareholders at its annual meeting in Dunedin yesterday. The result compared with a $9.8 million loss for the last financial year. In April, Cyclone Bola devastated the Gisborne region, with NZ Salmon losing about 60 per cent of its tomato and squash crops. Considering the current world-wide shortage of tomato paste, the opportunity cost was also heavy, Mr Far-

rant said. As part of the Government’s assistance for all cyclone victims, NZ Salmon was awarded more than $1 million compensation. Managing director, Mr Peter Townsend, said in his report the company had also been adversely impacted by the strength of the New Zealand economy. These had caused NZ Salmon to perform "well below” shareholders’ expectations. “We do not expect economic conditions in New Zealand to improve markedly for 12 to 18 months,” Mr Townsend said. Mr Townsend said the com-

pany’s Chilean joint venture with Aquacultivos was becoming an "increasingly significant” part of its activities. Mr Farrant told the meeting that despite the operating loss, the company’s over all financial position reflected a strong shareholder equity of 75 per cent total assets. Shareholders’ funds totalled $35.5 million. Projections for the 1989 year indicated a positive cash flow which would enable the company to maximise returns from each area of operation. “Providing nature treats us better than it has in the past two years we should be back on track by September, 1989,” Mr Farrant said.