Tassal has forecast sales, production, revenue and earnings growth for the current financial year.
The Tasmanian-based salmon and seafood producer expects stronger pricing in Australia and growth in national and international demand.
“From our analysis, there appears to be a supply shortage for domestic market fulfilment, and this should lead to strong pricing returns and an improved domestic pricing outlook …,” Tassal chairman Allan McCallum and chief executive Mark Ryan said in the company’s 2017-18 annual report.
“Demand for seafood in Australia is forecast to outstrip seafood and aquaculture growth, and analysts are signalling strong demand growth from China and North and South America.”
Other factors behind Tassal's positive outlook included fish size growth it said was three to five years ahead of plan.
It said that supported better domestic yields and pricing and underpinned an Asian export program requiring very large fish (for premium prices).
”Overall … we believe salmon demand should outstrip supply, with the outcome pricing will outpace costs,” they said.
Tassal’s net profit after tax dropped by 1.4 per cent to $57.3 million in 2017-18.
Earnings before interest, tax, depreciation and amortisation fell by 4 per cent to $110 million.
Mr McCallum and Mr Ryan said the company had a strong balance sheet which had been “significantly de-risked”.
“We are actively investigating strategic growth opportunities which unlock large synergies in the seafood supply market,” they said.
“Opportunities continue to be presented and assessed - like prawn farms - in the seafood value chain to diversify earnings and as a risk mitigation strategy.”
Wholly owned Tassal subsidiary De Costi Seafoods recently bought prawn aquaculture operation the Fortune Group for $31.9 million.
The deal involved three prawn farms, in New South Wales and Queensland.
Tassal expected to spend about $34 million on a capital works program for the prawn business over the next two to three years.
It said the acquisition would immediately increase earnings for shareholders.