28 April 2022
Quarterly Update & Appendix 4C
Period Ending 31 March 2022
KEY POINTS
Core Business
• YTD Harvest volume of 62.7 tonnes of abalone to 31 March 2022, up 5% on comparative FY21 period
• YTD abalone revenue to 31 March 2022, up 24% on comparative FY21 period
• Sales price per kg improvement of 20% on prior year comparative period maintained
• Ranch staffing depth and capabilities enhanced with second successful in-house commercial diver training program executed
• R&D priorities progressed, with focus on deployment practice improvements and redeployment of underperforming ABITATs on track for Q4 commencement
Growth
• eCommerce platform development advanced, on track for launch in Q4
• Ocean Pantry retail/tourism facility construction progressed and on track for Q4 opening
• BFS and investment decision for Esperance On-Land abalone farm deferred due to significant labour and materials supply constraints and associated upward cost pressures in WA
• Improved scale, diversification, and utilisation of our existing assets is a key focus of any new opportunities
DETAILS
Rare Foods Australia Ltd (ASX Code: RFA, the Company), Western Australia's largest oceanic harvested Greenlip abalone producer, is pleased to provide the following operations update and Appendix 4C Cashflow Report for the quarter ended 31 March 2021.
CORE BUSINESS - OCEAN RANCHING
Operations
The aggregate harvest for FY22 is 62.7 tonnes, representing a 5% improvement on harvest volume for the same FY21 period, and is consistent with the Company's targeted harvest tonnage to maintain Biomass growth objectives.
During the quarter, the Company has successfully completed its second on-site commercial diver recruitment and training, supporting Ranch labour depth.
The Company partnered with registered training organisation, Evaluation Pty Ltd, to design a certified program for the skills required to support aquaculture diving. Due to external market demand, the Company is evaluating plans to facilitate WA's first commercial diver training school for its own diver staffing security, that could also generate a wider local pool of industry divers and provide the business an additional source of revenue.
The Company has continued to progress immediate R&D priorities through Q3 including the reduction of mortality rates, lifting product growth rates and collating data to support the redeployment of underperforming ABITATs. The ABITAT relocation plan has received Board endorsement and will commence in Q4.
Sales & Marketing
Sales and marketing highlights for the quarter include:
FY22 abalone sales revenue of $2.84M to 31 March 2022, up 24% on the comparative FY21 period
H1 sales of 55.2 tonnes up 3% on H1 FY21
FY22 average sales price/kg 20% higher than the FY21 comparative period average sales price/kg
Other income derived from external participation in the commercial diver training program, with encouraging market demand
CASHFLOWS
RFA incurred a net operating cash deficit for Q3 of $579k, after commencing the Quarter with cash reserves of $2.1M and concluding the third quarter of operations with $1.51M.
Operating cashflows for the quarter included $896K in customer receipts, $20k in grant income, operating cash outflows of $1.44M and net Esperance Project study costs of $57k.
Payments to related parties for the quarter totalled $135k, including Directors, employees, and cold storage fees.
GROWTH
Rebranding
During the quarter, the Company continued the implementation of its sales and marketing strategy, progressing the development of the new website to allow the introduction of our eCommerce platform. This new platform will provide the opportunity to market and pursue a greater level of domestic sales, developing a diversified restaurant and wholesale customer base.
The eCommerce platform remains on track for launch in Q4 of FY22.
Organic Growth
The Company's MSC Accreditation process progressed during the quarter with a formal certification decision expected in Q4.
The Company continued to progress the Ocean Pantry initiative (retail offering), with the planning applications, design, and procurement of the building completed and the tourism offering. Installation and launch is on track for Q4.
Esperance On Land Abalone Project
As announced to the ASX on the 12 April 2022, completion of the feasibility study for the Esperance On-Land abalone Project has been postponed until June 2023. The prime reason for the deferral is the current COVID environment and resulting supply chain disruptions, cost pressures and a limitation of materials and resources in regional Western Australia. Both RFA along with our partner, Yumbah, remain focused on progressing stakeholder engagement and extracting value from the unique opportunity the Esperance Project presents.
Other Opportunities
With the rebranding to Rare Foods Australia, the Company has developed a disciplined framework to assess other growth opportunities. The Company is focused on improving scale, diversifying its products and customer base, and continuing to improve the utilisation of our unique assets.
The executive team are constantly evaluating additional product and supply chain opportunities which are progressing through various stages of development including product trials and evaluation.
END
This announcement was authorised to be given to the ASX by:
The Board of Rare Foods Australia Limited.
For investor and media enquiries, please contact:
Rob Jorden - Chief Executive Officer
Email:rjorden@rarefoods.com.au Mobile: +61 412 286 170
Bradley Adams - Executive Director Corporate Development
Email:badams@rarefoods.com.au Mobile: +61 417 910 023
Brent Stockden - Chief Financial Officer, Company Secretary & Commercial Services Manager Email:bstockden@rarefoods.com.au
Mobile: +61 407 884 783
About the Company
Rare Foods Australia Limited (ASX: RFA) has developed the world's first commercial greenlip abalone sea ranching business in the pristine waters of Flinders Bay, Western Australia. With the construction of proprietary, purpose-built artificial abalone reefs (called "ABITATS™") now complete, OGA is supplying commercial quantities of its premium, 'wild-harvested', greenlip abalone to local and overseas customers.
For more information visitwww.rarefoodsaustralia.com.au
Forward Looking Statements
This announcement may contain certain "forward-looking statements" which may not have been based solely on historical facts, but rather may be based on the Company's current expectations about future events and results. Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, forward looking statements are subject to risks, uncertainties, assumptions and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by such forward-looking statements. Such risks include, but are not limited to, currency fluctuations, increased production costs and variances in recovery rates from those assumed, as well as political and operational risks in the Countries and States in which we operate or sell the product to, and governmental regulation and judicial outcomes. The Company does not undertake any obligation to release publicly any revisions to any "forward-looking statement" to reflect events or circumstances after the date of this announcement, or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws.
Rule 4.7B
Appendix 4C
Quarterly cash flow report for entities subject to Listing Rule 4.7B
Name of entity
Rare Foods Australia Limited
ABN
Quarter ended ("current quarter")
52 148 155 042
31 March 2022
Consolidated statement of cash flows | Current quarter $A'000 | Year to date (9 months) $A'000 |
| 896 - (623) (34) - (597) (179) - 1 (6) - 20 (57) | 3,074 - (2,097) (122) - (1,950) (558) - 6 (19) - 1,011 (332) |
(579) | (987) |
1. A portion of cash outflows included in 1.2 (b) and (e) are also eligible for FY2022 R&D tax incentive.
2. Cash inflows are associated with $981k FY2021 Research and Development Tax Incentive and other grant funding of $30k, of which $20k was receipted in Q3.
3. Other cash inflows of $52k and cash outflows of $109k costs associated with Esperance Project development.
2. 2.1
Cash flows from investing activities Payments to acquire:
ASX Listing Rules Appendix 4C (01/12/19)
(a) entities | - | - |
(b) businesses | - | - |
Page 1 |
+ See chapter 19 of the ASX Listing Rules for defined terms.
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Rare Foods Australia Ltd. published this content on 28 April 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 April 2022 04:23:04 UTC.