ASMAK's profits have dropped in Q1 2012. (Photo: Stock File/FIS)
Asmak's Q1 profit sinks by 64pc
UNITED ARAB EMIRATES
Thursday, May 03, 2012, 03:10 (GMT + 9)
International Fish Farming Co’s (ASMAK) Q1 2012 financial statements showed a 63.7 per cent drop in net earnings to nearly AED 3.67 million (USD 99.9 million) versus AED 10.11 million (USD 2.8 million) a year ago. Revenue was cut in half to AED 58.7 million (USD 15.98 million) from AED 101.75 million (USD 27.7 million) and costs from discontinued operations remained constant.
EPS fell to roughly AED 0.04 (USD 0.01) from AED 0.16 (USD 0.04) in the first quarter of 2011, Mubasher reports.
The company saw a loss of AED 128,000 (USD 34,841) as it continued to suffer from halted farming operations in Oman and the United Arab Emirates (UAE). Asmak had initially focused on farms in the Emirates, but ended operations there and in Oman in 2009 because of huge algal blooms that were prominent in the area and killing fish, The National reports.
Asmak now imports fish from countries around the world to supply local supermarkets.
The firm has also diversified into other sectors, mainly property and construction, and retains a fish farm in Ajman.
After announcing the poor Q1 results, Asmak tried to reassure shareholders.
"The management confirms its commitment to support and enhance the core activities of the company to attain continuous growth," Asmak wrote on its website.
Analysts, however, responded with skepticism.
"The core business, which is farming fish, hasn't worked," said Mohammed Ali Yasin, an independent analyst in Abu Dhabi. "They haven't made any money on fish, but rather the other businesses they are involved in."
Asmak's stock has surged 418 per cent on the Abu Dhabi Securities Exchange (ADX) since January.
After the sudden rise, the ADX made an inquiry into the share activity on 17 April. Asmak responded that it was "fully committed to the laws and regulations of the Securities and Commodities Authority … and has no information or explanation behind the sudden interest in the stock."
The company used its Annual General Meeting to announce that it will boost its frozen seafood product offering to increase revenue and that it would carry out the pilot production of Asian sea bass in 2012, AME Info reports.
By Natalia Real