- Salmon farming company, Huon Aquaculture Group (HUO) is feeling the impact of COVID-19 and has had to modify its harvest program
- During April, restaurants, clubs and the food catering industry has been virtually closed all around Australia
- Although sales through retail channels have been strong, due to its high exposure to the foodservice channel, Huon has experienced a significant drop in sales in its wholesale market during April
- Additionally, access to the international market has been interrupted since late March due to the disruption to international air freight services
- With two of its major channels to market impacted, Huon has slowed its harvest of salmon until the market begins to normalise
- This means that the harvest for FY2020 will likely be between five and 10 per cent below the forecast 25,000 tonnes
- But the 2021 financial year however is expected to increase between 20 to 25 per cent above the baseline forecast of 30,000 tonnes
- Due to this, and the uncertainty around COVID-19, Huon is withdrawing its 2020 guidance
- Huon is down 5.28 per cent on market close, selling shares for $3.41 each
Salmon farming company, Huon Aquaculture Group (HUO) has updated the market on trading conditions during the third quarter.
During this quarter, a number of measures were implemented by the state and federal governments to contain COVID-19 in Australia.
This included the closure of national and international borders, which had the immediate impact of restricting access to flights carrying freight as the major airlines progressively grounded their fleets.
Huon’s operations during the first three months of 2020 were in line with the February expectations.
“In particular, as a result of the ongoing focus in the first half of 2020 on building biomass and completion of good summer growing conditions, the company was on target to exceed the planned harvest of at least 25,000 tonnes for the financial year,” the company said.
Huon has been following Government and Health Department guidelines and has been able to continue as normal.
However, during April, restaurants, clubs and the food catering industry has been virtually closed all around Australia (expect for take-away).
Although sales through retail channels have been strong, due to its high exposure to the foodservice channel, Huon has experienced a significant drop in sales in its wholesale market during April.
Additionally, access to the international market has been interrupted since late March due to the disruption to international air freight services.
With two of its major channels to market impacted, Huon has modified its harvest program, slowing harvest of salmon until the market begins to normalise.
This means that the harvest for FY2020 will likely be between five and 10 per cent below the forecast 25,000 tonnes.
The harvest for the 2021 financial year however is expected to increase between 20 to 25 per cent above the baseline forecast of 30,000 tonnes.
Due to this and the uncertainty around COVID-19, Huon is withdrawing its 2020 guidance.
Huon is down 5.28 per cent on market close, selling shares for $3.41 each.