Clean Seas Tuna fights for its survival
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MELBOURNE, Dec 21 AAP
December 21 2012, 3:03PM
Clean Seas Tuna is fighting for survival after failing to find a desperately needed partner for its troubled yellowtail kingfish business.
It also warned it would have to write down the value of its southern bluefin tuna (SBT) breeding program as it would be suspending its tuna propagation program, which would have a $30 million negative impact on its first half results.
The company's shares were punished, losing 1.3 cents, or 37.14 per cent, to 2.2 cents by 1430 AEDT, having traded as high as $2 in March, 2008.
However it says it has tackled the issues that were scaring investors away: including the health problems of 2012 that caused high numbers of fish deaths and a dramatic reduction in stocks.
The South Australian aquaculture company said on Friday that it had a choice to either continue with a stripped down kingfish business or to find a joint venture partner.
It would speak to a shortlist of potential partners in early 2013, it said.
The illnesses including infections of the intestine that caused many kingfish to die or not grow to full size in 2012 were disastrous leading to a $30.75 million full year loss and forced job losses and cost cutting.
The improvement of feed - including an essential amino acid taurine - had reduced mortality rates and improved health to achieve higher prices of $12.50 a kilogram, the company said.
It is seeking compensation in the tens of millions of dollars from its Australian feed suppliers.
The company blamed the present investment climate and the heavy funding requirements and losses associated with the fish health problems and its breeding program for scaring investors away.
"Given the company's limited financial resources and need to preserve liquidity, the company anticipates suspending its tuna propagation program for at least the 2013-14 summer, and to direct its limited financial resources to its yellowtail kingfish operations," it said.
Clean Seas owns a 400ha site at Arno Bay on the Eyre Peninsula.
It said it was largely debt free with a current cash balance of $3.93 million, up from $3.64 million at the end of September due to cost cutting, the sell down of its kingfish inventory and sale of surplus assets.
Capital raising options were being considered, including rights issues and debt raising.
By Greg Roberts