Clean Seas Lifts Guidance... again!!, page-2

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Clean Seas finds new Adelaide site to help grow kingfish business
Belinda Willis, The Advertiser
February 8, 2017 8:06am

CLEAN Seas Seafood will open a processing centre in Adelaide next financial year that is expected to create 20 new jobs.
The Port Lincoln-based seafood company, formerly known as Clean Seas Tuna, announced yesterday it had signed a long-term lease on a 2500 sq m building in Royal Park with plans to install state-of-the-art Marel processing equipment already ordered late last year.
Company managing director David Head said processing of the company’s kingfish was currently outsourced in Port Lincoln and Adelaide, but bringing the work in-house would create more control over quality, enable faster responses to large orders and support product development.
“We wanted to have complete control of the supply chain,” he said.
“For an investment of about $1.8 million we believe that having our own processing facility will allow us to increase our profitability by about $1 million a year.”
Mr Head said a search for a suitable facility in Port Lincoln had not eventuated and the company, Australia’s only commercial Kingfish producer, then found the site in Adelaide.
He said the move created access to a larger labour pool and made sense to centralise the processing work with the company’s plans to advance its farming footprint across the Spencer Gulf.
The company currently has its hatchery at Arno Bay and sea farms in the waters of Spencer Gulf just off Port Lincoln and Arno Bay.
Mr Head said the processing facility was expected to be operational later this year and offered additional space for expansion in value added production.
The building would also be used as a feed storage warehouse to reduce existing warehousing costs.
In an update to the market, Clean Seas also announced strong sales growth in the six months to December 31 with sales of 1086 tonnes, 45 per cent higher than the same period last year.
Farm gate prices improved ahead of schedule with export farm gates lifting by more than $2 per kg and Australian domestic farm gates by around 80c per kg.
However, the company reported that cooler than average seawater temperatures in the December quarter reduced fish growth.
Live fish biomass at December 31 was 1868 tonnes, around 400 tonnes lower than forecast.
“While the lower than average rate of biomass growth in H1 FY17 has provided unexpected assistance in addressing the structural imbalance between inventory and sales, it will therefore result in a lower than expected reported result,” the company said in a statement.
“On the basis that seawater temperatures return closer to normal as expected, growth in current biomass is expected to be sufficient to support the company’s sales growth objectives.”


Clean Seas is targeting sales volumes this financial year of up to 2500 tonnes.
Shares in the company closed steady at 3.4 cents.
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