Acquisition Enables Fishmeal Producer to Meet Demand - Analyst.
Lawrence Chor, an analyst with Taifook research said China Fishery Group (CFG), the coastal and deep sea fishery arm of Pacific Andes International registered a 15% year on year increase in revenue to $3.4billion for the first nine months in FY10.
He added: "CFG recorded 19% year on year sales growth to $2.6billion from fishing operations in the North Pacific Ocean amid an expansion of catch volume and $62million from the South Pacific with the start-up of operations there. The acquisition of two Peruvian fishing companies in May has lifted CFG's annual anchovy quota to 6% and 11% in Peru's northern and southern regions, making it the country's sixth-largest fishmeal producer."
"The acquisition notably bolsters Pacific Andes International's expansion strategy in the Peruvian fishery and helps it keep pace with the rising market demand for fishmeal. However, fishmeal revenue dipped 5% year on year to $703million for the nine months due to the drop in sales volume and a change in fishing seasons."
The analyst went on to say that the fishing and fishmeal division of Pacific Andes International's subsidiary, Pacific Andes Resources Development was the most profitable for the nine months.
Mr Chor concluded: "Gross profit jumped a remarkable 31% year on year to $1.3billion with a 4.7-ppt hike in the margin to 38.5%, compared to 8.4% for the frozen fish supply chain segment, thanks to better economies of scale and higher operating efficiencies at its North Pacific trawling and fishmeal processing operations. We remain positive on the price outlook for fishmeal longer-term and expect it to stay steady at the current level near term on the back of solid consumption demand."
About Pacific Andes International
Pacific Andes International is a vertically integrated frozen seafood producer and the world's largest fish fillet producer, which was listed on the Hong Kong Stock Exchange in 1994. It harvests, sources, processes and distributes a diverse range of frozen seafood products to over 36 countries and regions worldwide including China, North and South America, Europe, Africa and Asia. It is the largest fish importer in China, accounting for approximately 13% of the market. Its resource development and supply chain management division, Pacific Andes (Holdings) Limited, and its coastal and deep-sea industrial fishing arm, China Fishery Group Limited, were listed on the Singapore Stock Exchange in 1996 and 2006, respectively.