Higher taxes to upset Oceana’s catch


Higher taxes to upset Oceana’s catch

Published Date: 2019-04-15 | Source: Stephen Gunnion | Author: Stephen Gunnion | Comments

Higher taxes to upset Oceana’s catch

The fishing group says first-half gross profit rose sharply but higher taxes will result in lower earnings.

Oceana Group has prepared the market for a strong catch when it reports its interim results for the six months to end-March. However, all the benefits will be gobbled up by taxes.

Africa's largest fishing company says it sold more canned fish over the six-month period at higher prices. It also profited from stronger fishmeal and fish oil prices, as well as good hake and horse mackerel catch rates and prices.

Profit before tax for the period is expected to rise by as much as 30%, with lower foreign exchange losses, a lower net interest expense and the non-recurring effect of other operating expenses and fair-value losses recognised in the comparative period. Earnings will be lower though due to a materially higher tax charge. Last year it benefitted from the once-off release of deferred taxation amounting to R161 million after the US cut its federal corporate tax rate to 21% from 35%.

It expects to report a decrease in earnings per share (EPS) of between 19% and 23%, while headline EPS will fall by between 18% and 22%.

Ahead of the release of its results, Tiger Brands plans to unbundle its remaining stake in Oceana to Tiger shareholders. That's after selling a 5.9% stake to Brimstone Investments in January, taking Brimstone's shareholding in the fishing company to about 23%.

Oceana's shares closed 1.5% higher at R76.75 on Friday.

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