Lucky Star-owner feeling the pain

Oceana’s improved performance in South Africa under the Lucky Star brand was not enough to offset declines in the rest of the business, with it reporting a sharp decline in profit and headline earnings per share. 

The company said it was heavily impacted by the normalisation in the price of fish oil over the six months to 31 March 2025. 

As the Peruvian anchovy resource and production levels returned to higher levels, the price of fish oil declined sharply and heavily impacted Oceana’s financial performance. 

It said that this was the main reason for the company’s 43.9% decline in headline earnings per share compared to the same period in the 2024 financial year. 

Oceana’s revenue grew marginally to R5.2 billion due to improved performance from Lucky Star Foods in South Africa. 

Lucky Star benefited from increased consumer demand, increased local production, and enhanced operational efficiencies following significant investment in its South African operations. 

The company’s wild-caught seafood business also performed well, with increased hake catches and improved pricing. 

However, this was not enough to offset the decline in fish oil prices, which is an extremely lucrative business for Oceana. 

In particular, this business has a far higher margin than its other segments, making it a key driver of the company’s profitability. 

Thus, while Oceana’s revenue grew, its profit after tax declined by 43.7% compared to the same six-month period in the previous financial year to R402 million. 

This translated into a decline in headline earnings per share of 43.9% year-on-year to 324.9 cents per share. 

Oceana said its gross profit margin decreased by almost seven percentage points year-on-year due to the lower fish oil prices. 

Lucky Star Foods managed to improve its margin following upgrades to its cannery facilities in the previous financial year. 

This business reported a record volume for the six months, selling 5.1 million cartons in the period due to consistent consumer demand growth across all channels. 

Lucky Star has also continued its brand and range expansion to include different types of canned food, which Oceana said is showing pleasing volume growth. 

It is also increasing its presence across Africa, with Lucky Star exporting its products to West Africa for the first time during the six-month period. 

Local canning production volumes increased significantly to 2.9 million cartons, with the prior period having been impacted by factory closures to implement upgrades. 

The higher production levels contributed to margin improvement together with operational efficiencies from the recent factory upgrades. 

Lucky Star also benefited from a favourable increase in local pilchard landings to 8,881 tons, and a consistent supply of good-sized and high-quality frozen fish imported during the period.