Port Lincoln, South Australia-based tuna company Clean Seas Tuna has released a market update and announced changes in operations, following the company's corporate statement in November 2012.
Southern bluefin tuna propagation
Although this season's trials saw early Southern bluefin tuna (SBT) spawnings commence in October 2012 as scheduled, the volume and quantity of fertilised eggs produced to date has been disappointing compared to prior seasons.
Consequently, Clean Seas "does not expect to be able to transfer fingerlings to sea cages for experimental grow out early enough in the season, to achieve the Company's second goal of SBT juvenile winter survival," the company said in a statement.
As a result, Clean Seas "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."
"Whilst the Company continues to believe in the commercialisation potential of the successful closure of the SBT lifecycle, investment beyond the Company's current financial resources will be required for this goal to be achieved," Clean Seas continued.
"To this background, the directors believe it prudent to write down the significant investment in this project to an estimated net realisable value, in case the funding is not available in the future to re‐activate this program. The net impact on 1H 2013 results is likely to be in the order of A$30 million, a non‐cash outgoing."
Search for International Strategic Partner
Clean Seas also stated that the company and its advisors have been "unable to secure a strategic partner willing to make a significant investment in Clean Seas given the present investment climate, the previous ongoing funding requirement of the SBT propagation program and the significant prior losses arising from excess mortalities in the Yellowtail Kingfish division."
In response, the Clean Seas board and management are "directing their attention to the Company's survival, within the constraints of existing cash reserves supplemented with the sale of surplus assets. Now that the Yellowtail Kingfish health issues have been addressed, the Company is planning to either continue with a further scaled down Yellowtail Kingfish division in its own right, or in joint venture with a domestic partner. The contract with the Company's external financial advisors concluded on 31 December, 2012, following which the board and management will then hold discussions with a shortlist of identified potential domestic aquaculture partners."
Disclosure: The Baird family, owners of this website, hold shares in Clean Seas Tuna.
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