View of a New Zealand King Salmon farm.
Photo: New Zealand King Salmon.
In a stock exchange announcement, New Zealand King Salmon (NZKS) halved its profit forecast for 2026. The update follows a decision by the company's Board of Directors to reduce harvest volumes for approximately 4 months to rebuild biomass after it has been hit by lower-than-expected growth due to warmer water problems.
Following the Board's decision, NZKS reported that the estimated harvest volume for fiscal 2026 will be in the range of approximately 5,200 to 5,400 metric tons, compared to the 5,900 to 6,300 metric tons previously forecast.
As expected, as a result of this reduction in the harvest, the FY26 earnings guidance range of pro-forma EBITDA has also been revised downward. From NZD 15 million to NZD 24 million, the New Zealand salmon producer has now moved to a range of NZD 6 million to NZD 12 million.
This means that, in a best-case scenario, New Zealand King Salmon will see its projected earnings halved, while, in a worst-case scenario, the figure will be even lower.
NZKS also acknowledged that the reduction in harvest for fiscal 2026 will have an impact on its operations, as well as its customers, and said that these implications are currently being assessed. The company added that it expects harvest volumes to begin to recover in September 2025.
As stated above, the decision to reduce the harvest has been made by the Board with the objective of rebuilding biomass after a period of lower-than-expected growth. According to the NZKS stock exchange announcement, the main factor contributing to the lower fish growth has been lower than projected feeding, which has remained below the estimated volume for longer than anticipated.
Thus, although according to New Zealand King Salmon, the feed is improving, the reduction in harvest is intended to increase the biomass and average size of the fish. Failure to do so, the New Zealand company's note explains, would negatively affect its future harvests, starting in fiscal 2027.
Regarding the reason behind the problem of reduced feeding and, consequently, associated growth rates, NZKS stated that, "as with anything fish performance related," it is multifactorial, although it also noted that it occurred "with the dominant correlation occurring with the warmer water months."
This, NZKS said, can lead to increased stress and exacerbate challenges in fish health and performance, which reduces appetite and associated growth. "Reduced feed outs over summer are a normal occurrence, however this year the feed outs were more subdued than anticipated and have taken longer to recover to expected levels," the company explained.
New Zealand King Salmon, which is not the first time it has been affected by warm water issues, added in its release that it continues to develop tools and strategies that support fish health and performance in general, but also specifically for these periods.
The company specifically talked about a "key tool" it will implement for next summer. This is a season-specific diet designed to support fish health and performance. This diet was tested in its new Ruakākā trial pens over the most recent summer.
According to NZKS, the trial was positive and showed that the trial diet outperformed the current diet, with the fish experiencing higher feed outs, which promoted higher growth and survival rates compared to the current diet.
Although not mentioned in this stock exchange announcement in particular, given that many experts agree that offshore aquaculture could be an alternative for mitigating the effects of coastal warming, NZKS' Blue Endeavour project - New Zealand King Salmon's pilot open ocean farm backed by NZ's Government - could be another such mentioned tools and strategies.
