Annual Results Announcement

Results announcement
(for Equity Security issuer/Equity and Debt Security issuer)
Updated as at 17 October 2019


Results for announcement to the market
Name of issuer Sanford Limited
Reporting Period 12 months to 30 September 2020
Previous Reporting Period 12 months to 30 September 2019
Currency NZD

Amount (000s) Percentage change
Revenue from continuing
operations
$468,849 (13.99%)
Total Revenue $468,849 (13.99%)
Net profit/(loss) from
continuing operations
$22,433 (46.19%)
Total net profit/(loss) $22,433 (46.19%)
Interim/Final Dividend
Amount per Quoted Equity
Security
It is not proposed to pay a final dividend.
Imputed amount per Quoted
Equity Security
n/a
Record Date n/a
Dividend Payment Date n/a
Current period Prior comparable period
Net tangible assets per
Quoted Equity Security
$1.24407877 $1.00951663
A brief explanation of any of
the figures above necessary
to enable the figures to be
understood
For explanation on the operational results please refer to the
announcement commentary, the investor presentation and the
Annual Report for the year ended 30 September 2020
Authority for this announcement
Name of person

authorised
to make this announcement
Dean McIntosh
Contact person for this
announcement
Katherine Turner
Contact phone number 021 470 436
Contact email address kturner@sanford.co.nz
Date of release through MAP

12/11/2020

Audited financial statements accompany this announcement.

---

12 November 2020


Name of Listed Issuer: SANFORD LIMITED (SAN)
FINANCIAL RESULTS for the year ended 30 September 2020


Sanford’s Full Year Results Reflect Impact of Covid-19

Year to 30 September 2020 vs 2019

Harvest Volumes (000 GW tonne) 113 +7%*
Sales Volumes (000 GW tonne) 106 0%*
$m
Revenue 469 -14% (-11%*)
Gross Profit 82 -23%
Adjusted EBIT 38 -41%
Net Profit After Tax 22 -46%

Earnings per Share 24 cents
Dividend per Share 5 cents

*on a comparable basis i.e. excluding pelagics business from 2019 figures. Sold in March 2020.

New Zealand seafood company Sanford Limited (NZX:SAN) has reported total revenue of $468.8m
for the financial year ending September 30, 2020, a 14% decrease on 2019 ($545.1m). The business
sees this decrease as directly attributable to the Covid-19 pandemic and its impact on food service
globally.

However, the company says it has learned from the challenges and is adjusting to pandemic
conditions, making the business better prepared for the year ahead, and remains confident that its
longer-term strategy is the right one.

Sanford’s Adjusted (underlying) Earnings Before Interest and Tax (Adjusted EBIT
1
) for the year to 30
September 2020 was $38.3m (versus $64.8m for the prior year), representing a 41% decrease.
Reported Net Profit After Tax (NPAT) 2020 was $22.4m, compared to $41.7m for the previous year, a
46% decrease.

Sanford, like many seafood companies globally, has been primarily reliant on food service as a sales
channel, an area which has been hit hard by the lockdowns resulting from the Covid-19 pandemic
response. For example, the company saw sales into North America fall by 30% compared to last
year.


1
For reconciliation of the GAAP and non-GAAP performance measures in this document, refer to page 89 of
the company’s Integrated Annual Report for the year ended 30 September 2020.

Acting CEO Andre Gargiulo says recent changes to sales tactics in global markets, to facilitate more
consumer facing sales, means Sanford has a path to increased profitability in 2021.

“While we acknowledge this is a disappointing result, we are confident that our strategy to get
closer to our consumers and maximise the value of our products is the right one. We are adjusting
to changing market conditions and are putting in place a plan to more flexibly respond to changing
environments, while protecting profits through an appropriate cost structure.

“It is a tribute to the hard work of our people that we have continued to operate profitably in 2020
despite the substantial challenges. The business has learned a great deal and we continue to develop
alternative product formats and build a stronger presence in channels that have proved more
resilient.”

CFO Katherine Turner says the numbers reflect the challenge of rapidly adapting a business which
works on long time horizons for supply, for example seeding mussels or putting salmon smolt in the
water two years ahead of harvesting.

“Pleasingly, we harvested more fish and shellfish than last year (with the exception of toothfish), but
because of Covid-19, more stock than usual has gone to inventory.

“The pandemic’s impact on food service also meant that high value products were less in demand,
reducing our margins further and increasing our cost base.

“Despite the challenges, our balance sheet and liquidity remain robust, with a gearing ratio at 31%
compared to 24% last year and we will continue to make careful choices as we manage our asset
rejuvenation programme, balancing investment needs with cashflow realities.”

Board Chair Sir Robert McLeod says the board is currently making good progress in the process to
recruit a new CEO, replacing Volker Kuntzsch, who left on September 18, 2020.

Due to uncertainty caused by the impact of Covid-19, the ongoing asset rejuvenation programme
and wish to ensure prudent cash availability, the Board has taken the decision not to pay a final
dividend in respect of the 2020 financial year.

For more information or to arrange interviews, please contact:
Fiona MacMillan
GM Corporate Communications, Sanford
fmacmillan@sanford.co.nz
+64 (0)21 513 522

For investor relations queries, please contact:
Katherine Turner
Chief Financial Officer
kturner@sanford.co.nz
+64 (0)21 470 436

---

INTEGRATED REPORT 2020
2020

CARE
At Sanford, we value caring for the
wellbeing of ourselves, the team around
us, our customers and consumers,
key stakeholders and the communities
we work in. Crucially, we care for the
environment we are privileged to work in.
PASSION
We are passionate about our relationships
with our people, customers, consumers,
resources, country and future.
Our passion extends to protecting our
oceans, caring for the environment
and having successful partnerships.
INTEGRITY
We strive to live our values every day
in everything we do. This means having
straight-up conversations, delivering on
the expectations of our key stakeholders
and being respectful, honest, open and
transparent, as we work to always
do the right thing.
ACHIEVING TOGETHER
Guided by the underlying principle of achieving
together, we encourage, respect and value the
contributions of all team members and utilise
the talents of everyone to deliver
the best outcomes across our business
excellence framework. We actively build
partnerships across the business
and wider stakeholder community.
ASHLEIGH
44°23’06.7”S 171°15’29.3”E
WE
USING OUR VALUES
MEDHI
36°50’27.0”S 174°45’24.4”E

STEFAN
41°16’27.7”S 173°46’10.5”E
LESILA
36°50’27.528”S 174°45’23.76”E
WARWICK
36°50’27.528”S 174°45’23.76”E
44°23’07.2”S 171°15’29.4”E

—
ABOUT
THIS REPORT
AN INTRODUCTION
—
NAVIGATE is the title of our
2020 integrated report.
In the early days of seafaring, when
navigational aids were rudimentary,
a vessel out of sight of land was
in an uncertain position.
We have all experienced that uncertainty this
year: borders shut, businesses stalled, schools
closing, workforces sent home. Suddenly it
seemed the whole world was out of sight of
land, with many feeling anxious and uncertain.
We chose navigate as the theme for our
seventh integrated annual report because
it is an apt description of our response to the
pandemic and its impacts.
NAVIGATE speaks
to planning and directing a course, but it also
describes making way with particular care in
difficult conditions. There were no maps or
charts for making our way through a global
pandemic, so we had to set our own course.
This year’s report not only talks about our
results, but also the voyage of discovering our
ability to regroup, think quickly, act decisively,
allocate resources and back our decisions.
Care, passion, and integrity are core values
for us. So is achieving together and the
year will be memorable for all the wins
that our people delivered as much as
for the challenges we all faced.
It is not easy being asked to work
when others can stay home safely in a
lockdown bubble. It is good to be considered
an essential worker, but our people are also
essential to their families and communities.
Putting their safety first and living up to our
promise of care gave them the confidence
to come to work in our fleet, on our farms,
in hatcheries, in processing plants
and our offices.
Our people navigated carefully through
their own personal and family concerns
and commitments and we are immensely
grateful for their trust and their effort.
It has been an exhausting and unpredictable
year and disappointing in terms of our
financial results. But we found certainty in
ourselves and in our strengths and we have
these to build on. We have never lost sight of
our big ambition; to be the best seafood
company in the world. We will continue to set
our course in line with that ultimate ambition
and while there may be some uncertainties
still ahead and our priorities reflect this
reality, we will draw on what we have learned
in 2020 to navigate those too.
2Sanford Annual Report 2020

SUPPORTING STRONG
COMMUNITIES AND
PARTNERSHIPS
DELIVERING CONSUMERS’
EXPECTATIONS
BUILDING A SUSTAINABLE
SEAFOOD BUSINESS
27
53
37
61
45
69
ENSURING HEALTHY OCEANS
AND PROTECTING AND
ENHANCING THE ENVIRONMENT
CREATING A SAFE AND
HIGH PERFORMING
WORKPLACE
LEADING THE WAY TO
HEALTHY FOOD AND
MARINE EXTRACTS
QR CODES
QR codes appear throughout this
Report. Use these to access relevant
video and other content by opening the
camera function on your smart phone
and hovering over the code. Select the
web page that appears on the phone’s
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to download a QR reader app to enable
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SUPPORTING STRONG
COMMUNITIES AND
PARTNERSHIPS
DELIVERING CONSUMERS’
EXPECTATIONS
BUILDING A SUSTAINABLE
SEAFOOD BUSINESS
1. SANFORD AND OUR OPERATIONS
Chairman review04
CEO review07
CFO review10
Report structure14
Our global operations16
How we create value18
Highs and lows20
4. GOVERNANCE AND FINANCIALS
Corporate governance80
Financial statements91
Notes to the financial statements98
Combined independent auditor’s
and limited assurance report135
2. REPORTING WHAT MATTERS
Stakeholder engagement approach 22
Materiality matrix 24
5. APPENDICES AND REFERENCE
Appendices143
Accreditations and awards156
Corporate directory157
2020 Annual meeting158
3. OUR SIX PERFORMANCE OUTCOMES
ENABLING HEALTHY OCEANS
AND PROTECTING AND
ENHANCING THE ENVIRONMENT
CREATING A SAFE AND
HIGH PERFORMING
WORKPLACE
LEADING THE WAY TO
HEALTHY FOOD AND
MARINE EXTRACTS
CONTENTS
PLEASE NOTE that photos in this report were
taken both before and after the arrival of the
Covid-19 pandemic, so facemasks are not
always worn in these images.
WATCH VIDEO
Who is Sanford?
https://youtu.be/3YquQVYjGfE

The market volatility caused by Covid-19
remains. The economic outlook is uncertain.
New Zealand might be in more sheltered
waters as a nation in terms of the
pandemic’s toll, but our economy is still
dependent on global markets in varying
states of recovery. As a business, Sanford
enjoys the support of our local market,
but our global markets remain significant
and are materially off a full recovery.
In the year ahead the management of
our cashflows will require increased
vigilance around market risks. We will
take a pragmatic approach which supports
progress with our strategy, while managing
risks and protecting our balance sheet.
This is not the time to gamble with our
shareholders’ investment in us, or to
put at risk our people’s jobs and the
contribution we make in the economy,
especially at the local level.
SETTING THE COURSE
Our strategy emphasises a move towards
higher value products. That remains the
case. At the same time, Sanford has
historically sold large volume commodity-
based products, which still account for the
substantial part of our revenues. Pursuing
a value creation strategy does not mean
that volume and commodity species and
products are or will become insignificant.
In September, our CEO Volker Kuntzsch
made the decision to retire from Sanford
after seven years of service. The company
entered a consulting arrangement with
him to ensure he was available through
the transition period to a new permanent
CEO. Volker has made an outstanding
contribution to Sanford during his time
as CEO and continues to be a passionate
supporter of the company. As we publish
this report, Sanford is being led by a very
capable executive team, headed up by
Andre Gargiulo as Acting CEO.
STEADY ON STRATEGY
Volker’s resignation has raised the question
as to whether that foreshadows a significant
change in strategy. The Board is clear that
it does not alter the strategic direction of
the company.
Our strategy is a key contribution by
Volker to our business and continues to
be sound in major respects. New leadership
will bring some different perspectives
to the execution of that strategy, and the
Board will capitalise on any improvement
opportunity that arises. During Volker’s
time, Sanford revisited its strategy each
year to confirm its appropriateness to
present and future conditions, and we
will continue to do that.
Sir Robert McLeod
CHAIRMAN
Sanford is a resilient company.
Established in 1904 and listed
20 years later, we have come
through a Depression, two world
wars, heavy industry regulation,
the Asian financial crisis and the
global financial crisis. We have
been battered at times, but not
beaten. We have not let this year
be the exception.
There is no escaping the severe disruption
to our business from the global Covid-19
pandemic. Our Net Profit After Tax
(NPAT) was $22.4 million, 46% lower than
the prior year’s $41.7 million. Adjusted
Earnings before Interest and Tax (Adjusted
EBIT) of $38.3 million were 41% lower
than last year’s $64.8 million.
These results reflect the 14% reduction
in sales revenue, primarily as a result
of Covid-19’s impact on demand in our
global markets and our Gross Margin of
$82.5 million declined by 23%. Earnings
Per Share came in at 24c compared to
44.6c last year. Our CFO, Katherine
Turner, provides a full discussion of our
results and what influenced them on
pages 10 to 12.
—
CHAIRMAN
REVIEW
—
4Sanford Annual Report 2020
SANFORD AND OUR OPERATIONS
1
SANFORD AND

OUR OPERATIONS

5
It is not a case of “either or” but “and”.
There will be no slowdown in the
development of value-added products
and channels to market, but it is important
to appreciate that the revenue generated
has a significant amount of ground to cover
before it eclipses our commodity-based
revenue. Volker gave guidance on that
relativity by focusing on a target of
$1 of normalised EBIT per greenweight
kilogram sold.
We will continue to measure our
improvement against that metric under
our existing strategy; however, that will be
done by positive action around value-added
products rather than prejudicial action
towards our profitable commodity business.
OUR STAKEHOLDERS
Our shareholders ultimately control and
economically own Sanford, and the Board
governs at their pleasure. The goals of
Sanford and its shareholders, however,
can only be achieved by Sanford having
effective and successful relationships with
all its stakeholders such as customers,
people, suppliers and the community.
Sanford’s success is dependent on
attracting the best stakeholders and their
goodwill to our cause. The community,
which is partly represented by the
regulators, gives Sanford our license
to operate. This stakeholder framework
reflects how stakeholders create value
for each other through Sanford.
Each group is naturally looking to us
to provide a considered view of our
performance and progress. As Chair
I welcome these views as do our Board
and our leadership team.
SHAREHOLDERS
Our priorities for the new financial year are
to increase profitability, manage risk and to
continue to grow the business. This does
not mean chasing growth for growth’s sake.
Rather we will target opportunities that can
make a meaningful contribution to profit
and ultimately the value of our
shareholders investment in us.
We will maintain a sensible balance between
investing to grow our aquaculture operations
and our portfolio of value-added products,
and equipping our commodity business
to take advantage of every opportunity
to secure profitable sales. An example
is allowing our operational leaders to
make tactical choices, such as a switch
of species catch, when their vessel has
capacity. Tactics like these increase our
available volumes of valued commodity
species and those volumes can be sold
at profitable margins.
Our balance sheet remains strong, despite
the increase in borrowings as a result of
Covid with our debt to equity gearing ratio
at year end at 31%. We also slowed our
capital spend to $48 million for FY20 in
response to the market conditions and
we will maintain a watching brief in the
new financial year.
We will continue to support our strategy
with investments, such as our Marine
Extracts Centre and upgrades to our fleet,
when the business case is strong. The Board
will navigate a sensible course between
investing for the future while protecting
the balance sheet in the present.
Shareholders would expect nothing less.
Because of the continuing uncertainty
and the investment needs of our asset
rejuvenation programme, your Board has
determined that for prudency sake, that
there will be no final dividend payment
for the FY20 year. The total dividend paid
for FY20 will be 5 cents per share. The
Board is committed to re-establishing
a dividend when company performance
improves to a satisfactory level having
regard to prior years.
Consumer demand has been
shifting away from eating out
to in-home dining and we
have identified opportunities
in the domestic market and
our global markets to satisfy
this demand. We have
also used the crisis as an
opportunity to accelerate
a programme of product
diversification, drawing on
the strength of our core
commodities business.
1
SANFORD AND

OUR OPERATIONS

CUSTOMERS
Our strategy emphasises the need to get
closer to customers, particularly when it
comes to our higher value products such
as salmon and scampi in foodservice.
Covid-19 has enforced distancing, given
the curtailment of travel and the
collapse of foodservice demand has
also been a factor.
We have restructured our sales function
to close that distance, so we can rebuild
relationships as foodservice moves slowly
back to recovery. We are also appointing
partners who are more focused on retail
as a channel. Value-add and commodity
customers are equally important to Sanford
and our sales function now also reflects that.
Consumer demand has been shifting away
from eating out to in-home dining and
we have identified opportunities in the
domestic market and our global markets
to satisfy this demand. We have also used
the crisis as an opportunity to accelerate
a programme of product diversification,
drawing on the strength of our core
commodities business.
OUR PEOPLE
The Board salutes our Sanford people.
Classification of our business as an essential
industry provided us with a commercial
advantage but it also meant we asked a
lot of them. The Board sincerely thanks
everyone for the special effort put in
through a very challenging year.
We saw first-hand the rapid establishment
of response teams set up for people and
communication, fishing and farming,
land-based operations, logistics and supply
chain, sales and marketing and finance.
We saw very capable leadership of these
teams with daily assessment of priorities
and targets and allocation of resources.
Health and safety is an ever-present
concern in our industry, and the Board
congratulates the leadership team on the
thoroughness of their preparations to
ensure our people could return safely
to work with correct protection, social
distancing and inductions into the new
working requirements. Our people have
every right to be proud of their response,
their flexibility, their professionalism and
the pride they took in their purpose.
The significant increase in our engagement
scores across the year reflected that sense
of achievement and loyalty.
There is no better reassurance for our other
stakeholders that our business is in capable,
committed and hard-working hands at
every level. It has been an exhausting year
and we thank everyone for their endurance
and effort.
OUR SUPPLIERS
We are grateful for the support provided by
our suppliers. We have extensive networks,
ranging from our ACE fishers to our banks,
professional advisers to those providing
maintenance and engineering skills,
packaging products and supply chain
services. The year has challenged us all.
We appreciate the levels of flexibility
and co-operation we received, the wise
counsel and the care.
OUR COMMUNITY
There is no doubt that the challenges
wrought by Covid-19 did not end with
the financial year. As a company and as a
country, we will need continued resilience
as we rebuild the economy. We cannot
lose sight of the spirit of collaboration
and co-operation we saw on so many
levels this year.
Our industry can be a vital part of this
economic recovery. We have already
seen ambitious pre-pandemic plans laid
down for aquaculture industry to deliver
economic growth and jobs for the
regions and to become a $3 billion
industry by 2035.
New Zealand has a reputation for
sustainable, healthy and high-value
products from the sea and there is
considerable potential in developments
such as open ocean farming. Our
community includes the regulator
which is a very important relationship.
We are committed as a company, to work
within our industry to encourage policy
settings which support aquaculture’s
sustainable growth.
Healthy competition is important in our
industry, but it is also important that we
collaborate in areas that can advance our
collective interests and leverage the full
potential of our capacity and capabilities.
REFLECTIONS
I have had the privilege of chairing Sanford
from the close of the last AGM. The
pandemic increased the challenges across
the globe for many, including Sanford and
had a material adverse impact on company
performance, principally through a decline
in revenues. The Sanford response has been
fast and demanding. I thank all Sanford
people for the extraordinary effort that
they have made to mitigate this crisis.
I also thank Volker for his leadership,
obviously during this crisis period, but also
for the many prior years. Volker’s
commitment and contribution to the
company throughout his seven years of
service has been exemplary. Much thanks
on behalf of the Board and all those Sanford
people that Volker has led during his time
with us. We wish him and his family the very
best for a safe and successful future.
Sanford is a company that faces many
choices and opportunities. The challenge
for us is to make the smartest and most
profitable choices. The lingering pandemic
will require us to operate more
conservatively than we would otherwise
have done. Still, we expect it to abate in
time and we will calibrate the execution
of our strategy accordingly.
Sir Robert McLeod
CHAIRMAN
11 November 2020
CHAIRMAN REVIEW – CONTINUED
PHOTO: Perry Smith on board the San Aspiring
learning how to use a sextant navigation device.
The same navigation device can be seen on the
front cover of this annual report.
6Sanford Annual Report 2020
SANFORD AND OUR OPERATIONS
1
SANFORD AND

OUR OPERATIONS

7
rate (TRIFR down 41%, see page 38) to the
teams outstanding record on managing
Covid-19 risk for our people and customers.
When the pandemic hit, we got our people
safely back to work with all the necessary
protocols and protections in place,
regardless of whether their workplace was
on a deepwater vessel, a salmon or mussel
farm, a processing plant or an office set up
at home, and we kept them thoroughly and
continuously informed. This was our real
strength, and it has knitted a truly diverse
team into a stronger whole.
ACKNOWLEDGING THE WEAKNESSES
A glance at any of the major news sites
shows the pandemic’s ability to expose
vulnerabilities in people, governments,
institutions, and businesses. We were
not unscathed.
Our focus on foodservice had been a
strength before the pandemic. We were
able to deliver our premium product to
discerning customers and consumers in
a channel that yielded favourable margins.
The pandemic hit out of home consumption
hard in many of our key markets such
as China, the US and Europe. This was a
vulnerability somewhat unique to seafood,
as opposed to other primary produce –
more than 70% of all seafood produced
ACHIEVING TOGETHER
The impact of Covid-19, and its spread
beyond China to the four corners of the
world, is clear in our result which is well
below the expectations we had for this
financial year. It is not surprising, given the
collapse of markets, tourism, and aviation,
but it is still frustrating and disappointing.
With Adjusted Earnings Before Interest
and Tax of $38.3m (versus $64.8m for
FY19), our result is not a fair measure of the
effort put in by our people in very difficult
conditions. They proved themselves to be
resilient, adaptable, and undaunted, a real
living definition of our value of achieving
together. That is remarkable given this year
has been so challenging to people on all
levels, personal and professional. Detailed
numbers can be found in our CFO’s
Review on page 10 and from page 91 in the
Financial Statements section of this report.
Despite the challenges, there has been
some outstanding work across our fishing
and farming operations. Nature was kind
to us, in New Zealand waters at least,
and we recorded no algal blooms in our
farming areas in Marlborough or Southland.
However, we did not just benefit passively
from circumstances, I believe much of our
operational success is as a direct result of
our own efforts, from our reduced accident
What a remarkable year.
In January I was sitting in a
customer’s restaurant in the
US, hearing the front of house
tell us about the story behind
our Big Glory Bay salmon, this
premium brand all the way from
New Zealand.
Two months later, the World Health
Organisation declared a global pandemic
and our world changed completely.
We had to make rapid and often difficult
decisions about the way we lived and
worked to maintain jobs, supply chains
and customer connections. While
the constant change required us to
constantly reassess our priorities, we also
learnt to be swifter in our responses and
more alert to every opportunity.
As our financial year ended, I personally
faced another unexpected change.
Being asked to take on the role of
Acting CEO after Volker’s resignation
was a privilege, just as it’s a privilege to
work beside my dedicated colleagues
on the leadership team. I very much
appreciate their support.
Andre Gargiulo
ACTING CHIEF EXECUTIVE OFFICER
AND CHIEF CUSTOMER OFFICER
—
CEO
REVIEW
—
1
SANFORD AND

OUR OPERATIONS

CEO REVIEW – CONTINUED
globally is consumed outside the home.
Having diverse markets is something which
has previously been a strength for us. In the
past, if one territory experienced weakness,
other markets might be strong. This time,
we were seeing all of our markets impacted
in waves – just as one settled down, others
would shut down.
2020 has certainly given us a lot to navigate.
Previously our remoteness from our key
markets has always been easily overcome by
getting on an aircraft. Without that instant
access this year, our distance made it more
difficult to respond rapidly to changing
conditions in our key strategic markets. We
have since addressed this, securing partners
who share our values and understand the
importance of close customer relationships,
but we acknowledge there was a time lag in
this response and that has been a factor in
our results.
We have shown we can operate with great
speed and flexibility in our domestic market,
growing our online sales exponentially, but
we couldn’t replicate this flexibility in our
portfolio and in our international markets.
We did not have sales access in new areas
of demand, such as consumer retail. Again,
we are addressing this weakness, but again,
we have paid for the time lag.
Acknowledging our shortcomings and
addressing them has set us up better
for the new financial year as will being
clear-eyed about our strategic approach.
STRATEGY – BALANCING TODAY
WITH THE FUTURE
I agree with Sir Robert that our strategy
is the right one and that Volker has left
us with a charted course that we can
confidently follow.
Getting closer to the customer and
consumer, extracting more value from
the precious resources we have available
and doing so sustainably remain our focus.
“Sustainably” is a key part of that. That
has been our explicit aim for many years
now and it is no less important in a world
changed by Covid-19. Our customers and
consumers, our investors and our own
people should know it is a core part of our
approach. It represents our ability to take
pride in our business today and to be here
to do business tomorrow. We continue our
work to mitigate the impacts of climate
change and to reduce our own impact
on the planet, as outlined throughout the
pages that follow. This work does not stop
because of the global pandemic.
Covid-19 is not just a 2020 phenomenon. It
is going to be part of our short-term future
and we must learn to live with it in the here
and now without closing the door to future
opportunities. Balance is going to be key.
In the here and now, we must use the
strength inherent in our integrated
business, our core commodity portfolio
and the flexibility and skill of our people.
We certainly have the products – our
superb Big Glory Bay salmon, our
Greenshell™ mussels with their incredible
anti-inflammatory properties or our
sustainably caught inshore or deepwater
fish, with their compelling stories and
provenance – all deserve a place in
premium retail channels and in the
kitchens of discerning consumers.
We must do the basics well, staying
conscious of cost structures and growing
our market access – all while maintaining
a level of profitable sales that will enable
us to stay stable today. Then we can look
to our long-term future.
Stability might sound boring, but if you
look around the world today, it’s the one
thing everyone craves. For us, it means not
destroying value now, because if we do
that, we risk our ability to grow value later.
DELIVERING FOR OUR STAKEHOLDERS
Maintaining stability is also important for
all our stakeholders. Our shareholders
– and that includes many of our people
– do not want to see the value of their
investment in us eroded. Our people want
to feel confidence in our prospects and
plans. Our customers want us to continue
to deliver premium protein and support
their own ability to make a fair living.
Our suppliers too want to be reassured
we’re here for the long haul, because
our business supports their business.
Our communities at large want to be
confident that the contribution we make
to the local and national economy will be
safeguarded to the best of our ability.
If we are winning, all our stakeholders win.
And we are determined to win.
I want to thank our incredible people at
Sanford for their unstinting dedication
through this uniquely challenging year.
The executive team is very proud of you
and the work you did to keep yourselves
and the people around you safe. Thank you
to our Board for their wisdom, support and
guidance. Thank you to our outgoing CEO
Volker Kuntzsch, who set us on the right
course and led with his values and Sanford’s
values always to the fore.
Sanford is a great organisation with a proud
history. This company has continued to
operate successfully through two World
Wars and the 1918 flu pandemic. That history
puts our current situation into context.
We have continued to operate profitably in
2020 despite the substantial challenges and
we expect better results in 2021 as we bring
life to our value creation strategy.
We have an abundance of opportunities for
the future. In the current climate, we will
prioritize these opportunities to preserve the
core, realise value and set ourselves up to be
ambitious for the next 130 years. We will
continue to navigate with a “steady as she
goes” mantra matched with unwavering
excitement about our future destinations.
Andre Gargiulo
ACTING CHIEF EXECUTIVE OFFICER
AND CHIEF CUSTOMER OFFICER
11 November 2020
Sanford is a great organisation
with a proud history... that
history puts our current
situation into context.
8Sanford Annual Report 2020
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9
444
INDEPENDENT
SHAREFISHERS
2019: 451
15
DEEPWATER &
INSHORE VESSELS
2019: 15
22
AQUACULTURE
VESSELS
2019: 22
6
PROCESSING SITES
INCLUDING JOINT
OPERATIONS
2019: 7
1,387
TOTAL WORKFORCE
2019
2
: 1,453
SALMON
GREENWEIGHT TONNES
4,731
2019: 4,028
MUSSELS
GREENWEIGHT TONNES
33,918
2019: 29,419
WILDCATCH
GREENWEIGHT TONNES
84,373
4
2019: 90,351
87
3
QUOTA SPECIES
2019: 87
SANFORD IS
NZ’S SECOND LARGEST
QUOTA HOLDER
19.7%
1
2019: 19.4%
HOW HAVE WE PERFORMED?
1. Quota ownership based on New Zealand annual
catch entitlement (ACE) equivalent
2. See note 21, Appendix A
3. Figures relate to Sanford’s New Zealand quota only
4. Total wildcatch GWT comprises Sanford fleet,
including contracted ACE fisher’s landings
—
SANFORD
IN NUMBERS
—
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Last year I reported we were optimistic
about the 2020 financial year.
One year on, we are still optimistic about
the future, but we are also dealing with
the present.
A promising start to the year, with our
aquaculture volumes and revenue
increasing steadily, had slowed or stalled
by the time we reported our half year
results in May. By then, the impact of the
foodservice downturn was evident across
most of our fisheries portfolio and it was
also clear that salmon and mussels would
fall short of pre-Covid expectations.
KEY METRICS
We kept the market updated as we
navigated shifts in demand and softening
prices due to oversupply in the market.
With the seasonality of our fishing
operations, our fourth quarter traditionally
defines our year-end result. While the
fourth quarter showed some pockets of
growth, overall, it was a very poor quarter
and our second half EBIT result compared
to last year fell by 53%, mainly due to
the financial performance of our
wildcatch business.
As a result, our Adjusted Earnings before
Interest and Tax (EBIT) full year result of
$38.3 million, was 41% lower than last year’s
$64.8 million and our Net Profit After Tax
(NPAT) of $22.4 million was $19.3 million
lower than the prior year’s $41.7 million.
On a comparable basis, after adjusting
last year’s sales volumes to remove the
pelagics business which we sold during
2019, our full year sales volumes of 106k
GWT (greenweight tonne) were flat year
on year, with 2k tonnes lower wildcatch
sales volumes, offset by 2k higher
aquaculture volumes.
Our reported sales revenue for the year was
$469 million, down 14% on last year’s result
of $545 million (-11% on a comparable
basis), reflecting both the sale of lower
value product mix and lower prices in our
wildcatch business. Average sales price
achievement for our aquaculture business
was higher overall when compared to last
year, despite some compression of pricing
in our salmon business in the second half
of the year.
Our Gross profit of $82.5 million fell
by $25 million or 23% and also fell as a
percentage of sales by 2 points to 17.6%,
attributable not only to the lower sales
margin achieved but also incremental
costs in relation to people, fuel, nets,
packaging, storage and depreciation.
Discretionary spend was curtailed as the
impact of Covid began to be felt on our
financial performance. Operating expenses
were higher than 2019, reflecting
restructuring costs mainly from the closure
of our Tauranga plant. Adjusting for these
types of one-off costs, operating costs
were lower than last year, reflecting lower
marketing spend, people and travel costs
but higher costs for information technology
and insurance.
Our progress towards our goal of $1 of
profit (EBIT) per kilogram of greenweight
(GW kg) contracted 20 cents to 36 cents
compared to 56 cents last year, driven
by the impact of Covid-19 on our
wildcatch business.
CASH FLOW
Product supply this year has been
particularly good. However, with demand
constrained, inventory grew to 38% higher
in volume and 100% higher in value than the
same time last year.
Our operating cash flow for the year was
$18.8m, $29.9 million lower than the prior
year’s $48.7 million, impacted by lower
sales receipts and the impact of increased
inventory on working capital.
Katherine Turner
CHIEF FINANCIAL OFFICER
—
CFO
REVIEW
—
10Sanford Annual Report 2020
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11
We have been undertaking regular scenario
planning for liquidity as we work through
the pandemic’s impacts and cost measures
are in place so we can better weather
economic unpredictability.
Our investment programme was scheduled
to ramp up this year to support our growth
in innovation, marine farm expansions,
operational improvements for our fleet and
our information technology replacement
project (called SanCore). Our actual
expenditure, at $48 million, which was
$10 million more than our spend in 2019,
was slowed in part due to Covid and also
due to some delays in our Marine Extract
Centre project in Blenheim and design and
development changes in our scampi vessel
replacement programme.
Our gearing ratio increased to 31%
compared to the prior year’s 24%,
reflecting the higher debt balance with
a lower free cashflow, a good portion
of this expected to be addressed
over time through the sales of our
higher inventory levels . We secured
an additional $40 million of bank
facilities in May 2020 to provide
resilience against any further market
shocks. We closed FY20 with adequate
headroom in our committed facilities.
Cash collection remained satisfactory
through the year and our balance sheet
remains strong.
WILDCATCH FINANCIAL OVERVIEW
The following figures are like-for-like and
exclude the pelagics margin for the business
sold in 2019 financial year.
% Versus
Last Year
FY
2020
H1
2020
H2
2020
H2
2020
vs H1
2020
Sales volumes-3%-4%-3%+17%
Revenue -21%-9%-31%-5%
Profit
Contribution
-45%-48%-44%+63%
Landed catch volumes at 72k GWT were
overall 2% up on last year. Catch from our
deep-water fleet was up 10% overall with the
San Granit fully operational after being out
for three months last year. Our inshore
catch was down 7% like-for-like, as we
sourced fewer fresh fish through the
Covid lockdown periods.
Sales volumes were down -3% and overall
sales revenue was down -21%, reflecting a
very tough second half for wild catch from
a sales perspective. Wildcatch sales revenue
in the second half was 31% lower than the
same period last year.
The first half of the year was challenged
by a 39% lower Antarctic toothfish catch
than 2019 due to the ice conditions in the
Ross Sea; lower squid catch with a higher
proportion of smaller squid leading to
lower price achievement per kilogram; and
a drop off in demand for hoki fillet. These
factors were then exacerbated further by
the impacts of Covid on demand in the
second half of 2020.
Plans to close the revenue gap left by the
sale of the pelagics business by moving up
the value chain were stymied. Lower demand
has led to lower pricing, particularly on
our higher value products like toothfish
(Antarctic and Patagonian) and scampi,
as foodservice markets shut down.
We took the decision to move to lower
value hoki block production for which there
was demand and to delay the sale of our
Patagonian toothfish caught in August
and September into 2021. Overall average
selling prices per GW kilogram sold fell
20% in the second half, a factor of both
a reduction in pricing and a change in our
sales mix to lower value products.
Market wage adjustments have impacted
labour costs and extra costs were incurred
when we took the decision to shut
operations for three days at the end of
March 2020 to change our procedures
to ensure that as an essential service,
we could operate safely during the
Covid lockdown.
All of these factors and others have
culminated in a poor year for the profitability
of our wildcatch business. We are however
seeing evidence that prices have stabilized
and are beginning to rise, with the key
pollock fillet market seemingly under
supplied. Despite the challenges, as markets
recover, we are in a good position to partially
catch up on lost margins with our higher
than usual frozen inventory holdings.
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GREENSHELL™ MUSSELS
FINANCIAL OVERVIEW
%Versus
Last Year
FY
2020
H1
2020
H2
2020
H2
2020
vs H1
2020
Sales volumes +5%+6%+3%-13%
Revenue +12%+13%+10%-17%
Profit
Contribution
+30%+16%+69%-45%
With no significant algal blooms this year,
harvested volumes at 33.9k GW tonne,
were 15% up on last year.
Overall sales revenue grew 12% with a
continued roll-out of our strategy to realign
our sales from US to Asian markets where
demand is higher, driving both volume and
average price improvement in our half shell
as well as strong revenue growth in mussel
powder (+38%) and mussel meat (+31%).
Growth slowed considerably in the third
quarter as our markets were heavily
impacted by Covid outbreaks, particularly
in half shell product in the US where Quick
Service restaurant demand reduced rapidly.
Half shell pricing held up well until the last
quarter. We ended the financial year with
inventory levels we have not carried since
2017, but we have begun to see a slow
recovery with China beginning to grow
although prices remain under pressure.
Operationally, both our Havelock and our
joint venture NIML (North Island Mussels
Limited) Tauranga plant performed well
this year, benefiting from a much higher
availability of mussels which increased
the efficiencies of the plant.
The deployment of our diversification
strategy has continued, with new pack
formats being developed for retail sales
of mussels and new retail customers
secured. This also reduces our exposure
to the half-shell mussel market, but we
expect that this may take some time to
develop. Our new marine extracts facility
was expected to open in December 2020,
however Covid and consenting delays now
mean that we do not expect to commission
this site until September 2021.
While certainly not the year we had planned
for, in the circumstances, with a 30% increase
in profitability versus last year, we are
pleased with the overall performance
of our mussel business in 2020.
INVESTMENT
In 2018, the Board approved an elevated
capital budget of $120 million for FY19
and FY20, being an incremental $80 million
over historical annual expenditure of
$20 million in support of both asset
rejuvenation and our value strategy.
Even though delayed by this year’s events,
by 30 September 2020, we had deployed
$87 million into a number of key integrity
and growth capital projects which have
continued to improve our financial
performance and underpin the future
sustainability of our business.
OUTLOOK
Like many businesses, we have learned a lot
from the new challenges faced this year. The
near term outlook remains highly uncertain
and volatile and our focus in the near term is
to adjust rapidly to the external conditions
we are facing, focus on cash-flow and ensure
our strategic choices are fit for purpose in
the current environment while not losing
sight of our longer term goals.
Conditions this year have challenged many
businesses and we are fortunate at Sanford
to have a strong balance sheet, highly
engaged people and access rights to
beautiful NZ seafood. This gives us the
confidence that our value-focused strategy
will ultimately create substantial value for
our shareholders and all our stakeholders
in the future.
Katherine Turner
CHIEF FINANCIAL OFFICER
11 November 2020
KING SALMON
FINANCIAL OVERVIEW
%Versus
Last Year
FY
2020
H1
2020
H2
2020
H2
2020
vs H1
2020
Sales volumes +3%+2%+4%-17%
Revenue+4%+4%+4%-20%
Profit
Contribution
-9%+86%-79%-85%
Harvested salmon volumes of 4.7k GW
tonne, up 17% on last year, was also a new
record as we experienced glorious growing
conditions in Big Glory Bay, Stewart Island.
Unfortunately, our plans to expand rapidly
into the US and China through Foodservice
with our Big Glory Bay brand were thwarted
by Covid. The strong first half was followed
by a tough third quarter with a very slow
recovery from July onwards. Fortunately,
we were able to switch to supply domestic
retail and our New Zealand salmon revenue
business grew 14% in 2020.
Overall salmon sales volumes grew 3% on
last year and sales revenue grew 4% driven
by stronger sales prices in H1.
Conditions were favourable for a 18%
increase in the biomass with the absence
of biotoxins and low mortalities leading to
a lift in the fair value of our salmon in water
of $4 million. However, the fair value was
also impacted by a reduction in the future
selling prices and so this $4 million
increase was less than the $5 million
earnings uplift in the 2019 year, thus
contributing to an overall dip in the
salmon profitability in 2020.
While there were efficiencies from the
higher volumes, the compressed sales
margins and higher rates for wages,
depreciation and freight overall led
to a 9% drop in the salmon profit
contribution in 2020.
Looking ahead, we are seeing a recovery
as new retail demand continues to build
into the US to close to pre-Covid levels.
We are carrying forward some frozen
inventory and to help reduce this we are
launching Big Glory Bay smoked salmon
into retail in November 2020.
12Sanford Annual Report 2020
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13
Navigate is the title and theme
of this report. We have used a
stylised image of a chart divider
used for ocean navigation
throughout this report. Today our
fishers primarily use electronic
instruments to navigate, though
traditional methods, including
dividers such as these, remain
available in the wheelhouse.
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Welcome to our 2020 integrated
Annual Report. In keeping with
prior years, we have maintained
a structure which will be familiar
to most of our readers. The section
discusses the main headings and
a snapshot of the information
we have provided.
We discuss our Global Operations on pages
16 and 17. This year, this section shows the
impact of Covid-19 on demand patterns.
In a year where tourism experienced sharp
declines, aviation was largely grounded,
supply chains were disrupted and the
foodservice sector saw demand drop
dramatically, we summarise some of the
key changes we have observed market
by market.
How We Create Value on page 18 and 19
provides an integrated overview of our
business model and maps inputs to
outputs and outcomes.
Reporting What Matters on pages 22 to 26
summaries our materiality reporting, the
result of detailed work with a selection
of stakeholders sharing their views about
what matters most to them, whether
their concerns are changing and their
expectations of Sanford.
Each year we devote a chapter of our
report to each of the six outcomes in
our Business Excellence Framework.
Beautiful, sustainable seafood needs
healthy oceans, so we begin with our
chapter on Enabling Healthy Oceans and
Protecting and Enhancing the Environment
on page 27. Highlights this year include
our expansion at Big Glory Bay, our
Southland hatchery investment which
will support this growth and our open
ocean farming ambitions.
Our people are integral to our
performance. We are Creating a Safe
and High Performing Workplace, page 37,
because we want to be an employer of
choice. In this chapter, we discuss our
teams-based Covid response, the care
taken to keep our people safe in 2020
and a rescue mission to South Georgia.
Leading the Way to Healthy Food and Marine
Extracts beginning page 45 shows how we
are driving sustainable performance across
our value chain and positioning our brand as
the industry partner and supplier of choice.
This year we talk about the potential of
high-value, high potency mussel oil, the
development of our Marine Extracts Centre
in Blenheim, the drive to get more value
from every fish caught and our head start
with SPAT
nz’s mussel breeding successes.
Supporting Strong Communities and
Partnerships, page 53 speaks to our
intention to deliver a significant and
positive contribution everywhere we
work. Here we discuss the steps we took
to protect the people of Stewart Island
in the pandemic, our fish for foodbanks
initiative and some quick thinking in our
supply chain team to bring the logic back
into logistics when freight capacity
disappeared overnight thanks to the
pandemic.
Delivering Consumers’ Expectations, page 61
recognises that to be the brand and supplier
of choice for New Zealand seafood,
we must have a deep understanding
of customers’ and consumers’ needs.
We’re accelerating our closer to consumers
strategy with a push into a branded retail
range and we celebrate the achievement
of managing dramatic growth through
our e-commerce channel during the
Covid-19 lockdown.
Our sixth outcome, Building a Sustainable
Seafood Business, page 69 is the net result
of all the other outcomes working together.
It reflects our desire to deliver sustainable,
profitable, and socially beneficial outcomes
through our people, sector leadership
and approach to innovation and risk
management. This year we cover our
operational approach to navigating the
lockdown, along with progress with our
fleet investments to raise safety levels
and our long term plans to replace our
scampi vessels.
Each chapter includes our 2020 targets
for each outcome and our progress against
those targets. Each chapter ends with our
2021 targets and 2025 vision. Note that we
have streamlines our future focus targets
this year. We are no less ambitious in our
goals, but we wished to be more succinct
in how we express them.
Our full financial statements for 2020
follow the Outcomes chapters, beginning
on page 91.
UN SUSTAINABLE DEVELOPMENT GOALS
The United Nations, in 2015 adopted the
2030 agenda for sustainable development,
its centre piece are 17 Sustainable
Development Goals which are an urgent
call for action to achieve prosperity for
people and the planet, now and into the
future. This year, we reviewed the 169
targets that sit beneath those global goals,
and as a result refined our approach, now
focussing on the six development goals
where we believe we can make a difference.
—
REPORT
STRUCTURE
—
14Sanford Annual Report 2020
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15
These goals are Decent Work and Economic
Growth (Goal 8), Industry, Innovation and
Infrastructure (Goal 9), Responsible
Consumption and Production (Goal 12),
Climate Action (Goal 13), Life Below Water
(Goal 14) and Partnerships for the Goals
(Goal 17).
FURTHER INFORMATION
https://www.un.org/
sustainabledevelopment
We have identified the SDG’s relevant to
each chapter in a dashboard above each
of the main stories.
VALUE CREATION – THE SIX CAPITALS
FINANCIAL INTELLECTUAL
HUMAN NATURAL
MANUFACTURED
SOCIAL AND
RELATIONSHIP
Value creation in any one performance
outcome in our Business Excellence
Framework, will typically draw on input
from more than one of the six capitals.
We have attempted to illustrate this with
the addition of “dashboards” to each of
the performance outcome chapters in
this Report (which are explained below)
Examples in this year’s report include
the progress in our plans for our Marine
Extracts Centre in Blenheim, investments
in our fleet, further development in our
Sea to Me nutraceutical brand, and the
successful completion of the SPAT
nz
Primary Growth Partnership research
programme which has delivered important
improvements in the rearing and breeding
of hatchery spat for mussel farming.
We have also proven demand for online
ordering and delivery of market-fresh fish
in the Auckland region.
We are piloting leadership programmes
for our people, and our participation in
a money confidence pilot, designed for
Maori and Pasifika people has proved the
value of this programme.
Finally, we aim to make sure that everything
we achieve will contribute to the natural
capital that supports our business, as well
as our communities and stakeholders,
over the long term.
USING THE DASHBOARDS
At the beginning of each of the chapters
which follow beginning on page 27 we
include a dashboard which is a guide to how
the narrative content relates to our value
creation model. Each dashboard features
three wheels, one for inputs, indicating
to what extent each of the six capitals
has contributed to the developments in
that area of the business; one for which
outcome the chapter is focused on and one
wheel for which of the six SDG’s we focus
on are most relevant in that section of the
report. The degree of contribution on the
inputs wheel has been determined using
informal qualitative analysis, taking into
account the highlights in this performance
outcome over 2020 and the broader
and more typical contribution each
input makes in this area of Sanford’s
business performance.
REPORTING FRAMEWORKS
This Report has been developed in
accordance with the International
Integrated Reporting Council (IIRC)
Integrated Reporting Framework. This
enables us to explain how we create value
over time and provide transparency on
every aspect of our business activity.
We remain committed to integrated
reporting because it is the right thing
to do and we know an increasing number
of stakeholders are interested in how
we create long term sustainable value.
We wish to be transparent.
We also applied the Global Reporting
Initiative (GRI) Sustainability Reporting
Standard 2016 to a core level of
compliance, and report across a range
of best practice environmental, social
and governance (ESG) indicators. The
GRI index is included in Appendix E.
DISCLOSURE
Unless otherwise indicated, this Report
covers performance from all our operations,
including North Island Mussels Ltd in which
Sanford has a 50% interest.
During the year we acquired Saltwater
Seafoods Pty Ltd, a Melbourne-based
seafood company , the remaining 50%
interest in Perna Contracting Ltd (a mussel
harvesting business based in the South
Island), a 50% interest in Malmac Trading
Ltd (a retail seaweed business trading as
Pacific Harvest) and a 50% interest in
Two Islands Co NZ Ltd, which is a dietary
supplements business.
All financial data is presented in
New Zealand dollars, unless otherwise
stated. Any changes or restatements of
previously reported figures are identified
throughout the Report. KPMG has provided
independent assurance of this Report,
and this covers both statutory financial
and selected nonfinancial information.
The combined independent auditors and
limited assurance report begins on page 135.
This Report, produced by Sanford’s
management team and reviewed by our
Executive team, has been signed off by
Andre Gargiulo, our Acting Chief Executive
Officer and the Board as a true and
accurate picture of Sanford’s performance
during the year. The Directors are pleased
to present the Integrated Annual Report
of Sanford Limited for the year ended
30 September 2020.
For and on behalf of the Board of Directors:
Sir R A McLeod
CHAIRMAN
11 November 2020
F Mackenzie
CHAIR AUDIT FINANCE AND RISK COMMITTEE
11 November 2020
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Indian Ocean
South Pacific
North Atlantic
South Atlantic
Tropic of Capricorn
Equator
Tropic of Cancer
Arctic Ocean
North Pacific
Southern Ocean
Melbourne
AUSTRALIA
(INC. PACIFIC ISLANDS)*
10.4
%
SOUTH
KOREA*
2.2
%
2019: 1.3%
2019: 9.3%
RUSSIA
1.5
%
2019: 1.0%
OTHER ASIA*
3.1
%
2019: 3.4%
JAPAN*
2.3
%
2019: 2.8%
*
EUROPE*
12.6
%
2019: 11.3%
NORTH AMERICA*
10.8
%
2019: 13.4%
12.5
%
2019: 11.4%
CHINA
(INC. HONG KONG)*
Each year we provide this snapshot
of our major export markets, along
with a map of our New Zealand
operations and their footprint.
Despite the upheaval caused by Covid-19,
particularly in foodservice demand, there
is little change in the ranking of our top
nine markets, with one exception. Russia
enters the list at nine, replacing Africa
which is a traditional commodity market,
driven mainly by demand for pelagic species
which we no longer harvest following the
sale of the pelagic fleet in 2019. However,
while the percentages have not changed
drastically, our total sales volumes have,
reflecting the challenges the Covid-19
pandemic has created. The different results
for each of our categories was dependant
on our ability to diversify our channels
in each of those markets. We detail some
of those markets here.
EUROPE — Europe became our top export
market this year with 12.6% of sales versus
11.3% in 2019. This reflects a very stable year
across our major product groups in
this market (FY19 sales including Russia
were 12.3%), such as hoki and squid,
a strong result given the issues caused by
the pandemic across the European Union.
CHINA, INCLUDING HONG KONG – China
and Hong Kong represent our second largest
export market in FY20. Our revenues
dropped substantially in this territory
because of a decline in squid revenues as
a result of smaller sizes and lower prices
caused by the variable nature of the squid
fishery. Salmon and mussels however,
started the year very well. They were
impacted in the second half but the
lockdowns in China and by concerns around
positive Covid-19 tests from a chopping
board in Beijing used by a seller of imported
salmon. However, despite this, our salmon
sales rose in both volume and value in the
year overall. Half shell mussel revenue
and margins also reached new highs.
NORTH AMERICA
—
North America accounted for
10.8% of sales this year, compared to
the prior year’s leading export position
at 13.4% of sales. The decline represents
a very disappointing gap between our
aspirations for pre-pandemic growth
in that market and what was actually
achieved under Covid-19 conditions.
Salmon showed 2% growth thanks to
strong work in our first half with the
Big Glory Bay brand, which built on the
prior year’s progress in introducing the
brand to top-end restaurants in Southern
Californian, Sacramento, the Napa Valley,
Las Vegas, Texas and Hawaii. However,
this growth was curtailed, with foodservice
closures severely impacting demand in
the second half. We are more positive in
our outlook for 2021 as we return to our
brand building in food service.
—
OUR
GLOBAL SALES
FOOTPRINT
—
16Sanford Annual Report 2020
SANFORD AND OUR OPERATIONS
1
SANFORD AND

OUR OPERATIONS

17
ProcessingAquaculture
FishingFish Market
Processing
Joint Arrangements
Aquaculture
Joint Arrangements
Head OfficeFishing area
Top Export Countries
* Percentage of operations revenue
from top nine geographical
locations at point of sale
KEY
Auckland
Nelson
Havelock
Timaru
Bluff
Waitaki
Kaitangata
Stewart Island
Coromandel
Tauranga
Blenheim
Our move to grow half shell mussels sales
showed value with greater than 10% growth
in the year, despite the closure of all our
major customers for a period in the second
half. We believe we are well positioned to
command a strong market share position
in the new financial year.
We had significant decreases in our
wild caught sales in North America
with Toothfish well down due to reduced
catch numbers, the phasing of Patagonian
toothfish sales and a decline in squid
revenue as a result of channels being
closed in the second half.
AUSTRALIA AND THE PACIFIC ISLANDS
— Australia and the Pacific Islands
represented 10.4% of sales compared to
9.3% in 2019, with salmon and mussels
accounting for the increase. We had a
change in the market this year, acquiring
long-term partners Saltwater Seafood
as part of our strategy to step up in the
business to business channel servicing
wholesalers and food service as well as
retailers like fish shops and fish counters
at markets.
While the acquisition is positive and creates
a stronger Australian headquarters for us,
we were impacted by reduced wildcatch
sales. However overall revenue and prices
were ahead for the year, as our volume
decreases were a result of the exit from
pelagic species in 2019.
RUSSIA — Russia became our ninth largest
export market this year, accounting for 1.5%
of sales (1.0% in 2019) thanks to positive
half shell mussel revenues.
NEW ZEALAND — Our domestic market
is always our priority and New Zealand
became an even greater strategic pillar
of Sanford’s business during the pandemic.
Sales at 43.9% were on a par with the
prior year’s 43.9%. Our salmon and mussel
categories grew during the year, while
wildcatch sales declined primarily because
of reduced tourism numbers and lower
foodservice demand in key tourist hotspots.
Salmon sales across our key retail partners
remained strong and we grew this offering
versus previous years, while mussel sales
were 5% up on the prior year due to
significant growth in live sales for further
export and mussel meat for local high-end
pet producers.
NEW ZEALAND*
43.9
%
2019: 43.9%
1
SANFORD AND

OUR OPERATIONS

1448
1555
1109
1328
1758
328
252
337
427
1018
800
688
385
265
263
238
442
308
942
808
738
580
644
532
517
615
1718
2251
1436
2650
1413
1632
677
675
587
743
414
268
358
354
253
153
183
451
258
718
415
127
129
130
125
155
123
128
143
37
40
228
462
317
291
258
541
462
369
578
437
769
232
165
366
590
609
744
1270
1525
1938
1718
882
328
159
359
469
374
244
441
423
485
478
465
355
351
242
241
138
525
551
549
591
648
917
1612
1488
1504
1605
2072
1771
1522
1438
1475
1134
1112
1018
1006
1617
1271
1437
1223
1117
1221
743
633
424
1218
894
694
529
106
103
120
114
137
135
131
83
73
80
81
108
84
86
77
139
104
89
1119
429
358
242
255
237
108
101
112
119
80
90
63
59
89
69
74
57
62
103
103
59
53
58
57
90
80
74
85
65
38
48
40
36
46
37
40
43
38
105
122
113
123
118
135
124
560
855
702
604
575
861
767
831
800
838
808
859
814
1074
830
1077
855
1307
685
677
885
942
465
442
339
343
226
258
515
150
75
110
85
82
90
78
92
85
104
129
248
112
127
124
137
109
115
132
115
113
109
120
448
473
338
243
355
590
934
734
834
159
129
121
119
141
135
119
114
104
99
854
464
48
984
600
722
2101
1177
1187
875
129
722
648
677
1123
852
1617
958
852
825
934
1256
2000
1000
405
500
400
300
177
400
100
500
400
300
200
400
300
500
1848
1000
333
220
444
149
887
200
300
400
500
434
335
500
400
300
100
425
454
654
200
FINANCIAL CAPITAL
Pool of necessary funds (equity, debt
and grants) provided by banks and
shareholders, or generated through
operations or investments
HUMAN CAPITAL
Competencies, capabilities and
experience of our employees, our key
asset, and the capacity to add value
through human capital development
MANUFACTURED CAPITAL
Tangible, production-orientated goods
and infrastructure owned, leased or
controlled by Sanford that contributes to
the delivery of our products and services
INTELLECTUAL CAPITAL
Intellectual property, brand and reputation,
a key element of our future earning
potential and competitive advantage
NATURAL CAPITAL
Stock of natural resources or
environmental assets (water, atmosphere,
land, materials, biodiversity and ecosystem
health) that are fundamental to our
future prosperity
SOCIAL & RELATIONSHIP CAPITAL
Relationships within Sanford, and between
Sanford and its external stakeholders,
which are essential to retaining our social
licence to operate, including relationships
to maintain quotas and licences
fundamental to our future prosperity
OUR VALUES
OUR VISION
FISHING
FARMING
HARVESTING
THE BEST
SEAFOOD
COMPANY IN
THE WORLD
INPUTSOUR BUSINESS
—
CREATING VALUE
—
37
FISHING AND
AQUACULTURE
VESSELS
225
AQUACULTURE
FARMS
2
INNOVATION
SITES
6
PROCESSING
SITES
123,022
TONNES OF SEAFOOD
18Sanford Annual Report 2020
SANFORD AND OUR OPERATIONS

1448
1555
1109
1328
1758
328
252
337
427
1018
800
688
385
265
263
238
442
308
942
808
738
580
644
532
517
615
1718
2251
1436
2650
1413
1632
677
675
587
743
414
268
358
354
253
153
183
451
258
718
415
127
129
130
125
155
123
128
143
37
40
228
462
317
291
258
541
462
369
578
437
769
232
165
366
590
609
744
1270
1525
1938
1718
882
328
159
359
469
374
244
441
423
485
478
465
355
351
242
241
138
525
551
549
591
648
917
1612
1488
1504
1605
2072
1771
1522
1438
1475
1134
1112
1018
1006
1617
1271
1437
1223
1117
1221
743
633
424
1218
894
694
529
106
103
120
114
137
135
131
83
73
80
81
108
84
86
77
139
104
89
1119
429
358
242
255
237
108
101
112
119
80
90
63
59
89
69
74
57
62
103
103
59
53
58
57
90
80
74
85
65
38
48
40
36
46
37
40
43
38
105
122
113
123
118
135
124
560
855
702
604
575
861
767
831
800
838
808
859
814
1074
830
1077
855
1307
685
677
885
942
465
442
339
343
226
258
515
150
75
110
85
82
90
78
92
85
104
129
248
112
127
124
137
109
115
132
115
113
109
120
448
473
338
243
355
590
934
734
834
159
129
121
119
141
135
119
114
104
99
854
464
48
984
600
722
2101
1177
1187
875
129
722
648
677
1123
852
1617
958
852
825
934
1256
2000
1000
405
500
400
300
177
400
100
500
400
300
200
400
300
500
1848
1000
333
220
444
149
887
200
300
400
500
434
335
500
400
300
100
425
454
654
200
OUTPUTSOUTCOMES
BEAUTIFUL
NEW ZEALAND
SEAFOOD
REVENUE IN 2020
$468.8
M
769
CUSTOMERS
720
M
MEALS PRODUCED
Standard meals based on a
100g portion of seafood
Enabling Healthy Oceans and Protecting
and Enhancing the Environment
We will lead by example in health ocean management
so that future generations can enjoy and benefit
from our biologically diverse, safe and healthy
oceans. We will work with our people, customers and
suppliers to lead the way in maximising resource
utilisation, minimising our footprint and protecting
the environment wherever we operate.
Creating a Safe and
High Performing Workplace
We strive to become an employer of choice
by delivering industry leading safety risk
management, ensuring a culture of high
performance and growth and by living our values.
Leading the Way to Healthy Food 
and Marine Extracts
We will lead the way in driving sustainable performance
across our value chain, and positioning our brand as the
industry partner and supplier of choice.
Supporting Strong
Communities and Partnerships
Our leadership in creating employment and skills
opportunities, coupled with our understanding of the
needs of our communities and partners, ensure we
deliver a significant and positive contribution
everywhere we work.
Delivering Consumers’ Expectations
We will work with customers and consumers to bring
them the best of our sustainably harvested seafood
and marine extracts, demonstrating great care for
our beautiful New Zealand products and achieving the
optimal value for these precious resources.
Building a Sustainable Seafood Business
We will endeavour to deliver sustainable,
profitable and socially beneficial outcomes
through our people, sector leadership, approach
to innovation and risk management strategies.
19
1
SANFORD AND

OUR OPERATIONS

ENABLING
HEALTHY OCEANS
AND PROTECTING
AND ENHANCING
THE ENVIRONMENT
HIGHSLOWS
VALUE CREATION
OUTCOMES
LEADING
THE WAY TO
HEALTHY FOOD
AND MARINE
EXTRACTS
CREATING A
SAFE AND HIGH
PERFORMING
WORKPLACE
31%
of waste diverted
from landfill
across all operations
BEST CHOICE
rating awarded by Monterey Bay
Aquarium’s Seafood Watch program
for our farmed King Salmon
INCREASED
energy and water use per kilo processed and
$ sold as a result of increased cleaning
requirements, distancing and productivity
effects of Covid-19 related work practices.
3
notifiable spills
totalling 45L
2019 2
▼
41%
reduction in Total
Recordable Incident
Frequency Rate
compared to FY19
76%
employee
engagement score
2019 72%
ROLLED OUT
new incident management software (Intelex)
▼
10%
reduction in total NZQA credits
awarded for industry training
(with training by females
being affected the most,
with a 55% reduction)
▲
12%
increase in number of days off
work related to ACC claims
ACQUIRED
50% stakes in Pacific Harvest (edible seaweeds) and
Two Islands (health and beauty brand, to develop
marine collagen and associated synergies)
SUCCESSFUL
COMPLETION

of the SPATnz Primary Growth Partnership agreement
32%
proportion of customer
complaints relating to quality
defects 2019 21%
—
HIGHS AND LOWS
—
20Sanford Annual Report 2020
SANFORD AND OUR OPERATIONS
1
SANFORD AND

OUR OPERATIONS

21

DELIVERING
CONSUMERS’
EXPECTATIONS
BRANDED
SALMON
Global sales of Big Glory Bay branded
salmon short of target by 69% due to
disruption in the foodservice sector.
SUPPORTING
STRONG
COMMUNITIES AND
PARTNERSHIPS
IMPACT ON STAFF
IN TAURANGA
of our footprint changes, which was also
disappointing for the local community. We
worked collaboratively with the staff to assist
them through the change
COMPLETED
and did not extend our support of Paralympics
New Zealand. We wish the para-athletes, and
Paralympics New Zealand the best for their
future and in their leadup to their next games
LAUNCHED
Southland 10c a salmon
community fund for
Stewart Island and Bluff
INITIATED
fish donations to community
foodbank programmes.
9,054 kg donated between
May 2020-30 Sept 2020
EXPANDED
our support of the Graeme Dingle Foundation beyond
2020 and added additional regions (Auckland) to our
support package. Supported by Sanford’s assistance
the foundation assisted 21,744 students across
98 schools in the 6 regions Sanford support
BUILDING A
SUSTAINABLE
SEAFOOD
BUSINESS
HIGHSLOWS
VALUE CREATION
OUTCOMES
▼
31%
reduction in catch (FY20 vs FY19)
for high value Antarctic and
Patagonian Toothfish
ONGOING
DEPLOYMENT
of mitigation measures for algal bloom events
at Big Glory Bay
▲
17%
SALMON
4,731 MT harvested
▲
15%
MUSSELS
33,918 MT harvested
$468.8
M
▼ 14%
2019 $545.1M
REVENUE
RECORD HARVESTS
218
pharmacies in
New Zealand stocking
SeaToMe products
▲
695%
growth in domestic online sales
channel during FY20
$38.3
M
2019 $64.8
M

ADJUSTED EBIT
1
SANFORD AND

OUR OPERATIONS

—
OUR APPROACH
—
Each year we engage with key stakeholders to better understand what
matters most to them. With support from our partner thinkstep-anz,
we identify and rank the issues stakeholders regard as material for our
business using a combination of interviews, workshops and surveys
informed by the International Integrated Reporting Council (IIRC)
Framework and the Global Reporting Initiative (GRI) Standards.
01
IDENTIFY
STAKEHOLDERS
This year we engaged with 36 stakeholders
(22 external and 14 internal) using one-on-
one and group interviews. Since 2017,
we have engaged with 139 stakeholders
through the current iteration of our
materiality assessment process. These
stakeholders were selected and ranked
using best practice criteria from the
AA1000 Stakeholder Engagement Standard
2015, with selection based on criteria such
as dependency, responsibility, urgency,
influence, and their ability to bring a
diverse perspective.
During 2020 we engaged with a diverse
range of stakeholders representing the
interests of our customers (both domestic
and international), investors, NGO’s, iwi,
competitor, local government, community
groups, fisheries scientists and researchers.
We also canvassed internal stakeholders
with representatives from across the various
divisions and geography of our operations.
1. Colmar Brunton Better Futures Report 2020
03
IDENTIFY ISSUES
The topics raised in each interview were
compared to the list of 30 material issues
from 2019 to identify changes. Words such
as “resilience”, “agility” and “nimbleness”
were much more common this year due to
Covid-19. As a result, we reframed all issues
involving risk to make them active rather
than passive, e.g. “Impacts due to climate
change” became Climate change resilience.
Given the strong interrelationships between
issues, we also tried to reduce duplication
and to shift the focus from the outcome
to the driver. For example, “Profitability”
has been removed as it is driven by a
combination of Maximising $/kg of our
harvest, Operational excellence and
Innovation in products and markets.
Similarly, “Social licence” has been
reframed as Community support and
connection, providing social licence
to operate.
One new issue was identified for 2020:
Eliminating plastics in the ocean. This issue
was included following its introduction by
stakeholders during the materiality process,
and also as it is regularly raised as a key
issue in consumer surveys in connection
with ocean and environmental health
1
.
STAKEHOLDER ENGAGEMENT PROCESS
02
ENGAGE
STAKEHOLDERS
Building on the success of our regional
workshops last year, the original plan for
2020 was to run stakeholder workshops
in Timaru in April and Auckland in May.
The onset of Covid-19 meant that both
workshops had to be cancelled. We instead
engaged with stakeholders using online or
phone interviews.
In addition to asking stakeholders about
the issues most crucial for Sanford, we also
asked how their outlooks had shifted as a
result of Covid-19, and also what they would
change about the seafood industry if they
could wave a magic wand and change
absolutely anything. In doing this, we sought
to understand their visions for the future,
unconstrained by today’s realities.
22Sanford Annual Report 2020
REPORTING WHAT MATTERS
2
REPORTING WHAT MATTERS

23
06
PRODUCE A
MATERIALITY MATRIX
The results of the ranking exercise are
presented on the vertical axis (“business
impact”) and the results of the stakeholder
questionnaires (both internal and external)
are presented on the horizontal axis
(“stakeholder concern”) of this year’s
materiality matrix (Figure 1). This approach
is different to Sanford’s past Annual
Report’s where both axes were based
on questionnaire results, with internal
stakeholders’ rankings used for the
vertical axis (“business impact”) and
external stakeholders’ rankings used for
the horizontal axis (“stakeholder concern).
This change has strengthened the business
impact rankings through the increased
inputs of key business decision makers.
07
SENSE-CHECK
THROUGHOUT THE
PROCESS
Sources of information to check for
completeness included the UN Sustainable
Development Goals (SDGs), outputs from
our Audit, Finance and Risk Committee,
Colmar Brunton’s Better Futures report
and lists of global megatrends.
04
DETERMINE “STAKEHOLDER
CONCERN”, BASED ON
STAKEHOLDERS’ RANKINGS
OF THE ISSUES
A shortlist of 23 issues was prepared from
the interviews, and a web-based
questionnaire was sent to all interviewees.
They were asked to rank each of the issues
that were identified by all stakeholders
collectively. One key change from last year
in this process was that stakeholders were
asked to sort the issues in order of most
to least significant for Sanford from their
perspective – a technique referred to as
‘forced ranking’. In past years, we asked
stakeholders to score issues on a scale from
1 to 10, which resulted in most issues being
scored between 7 and 10 and therefore
clustered towards the top-right of the
materiality matrix.
05
DETERMINE “BUSINESS
IMPACT”, BASED ON
RANKINGS FROM OUR
EXECUTIVE TEAM AND
BUSINESS LEADS
A workshop was held with Sanford’s
Executive Team and the Business
Management Team leaders to rank the
material issues by their potential impact
on Sanford’s business using a pairwise
comparison method. The criteria
considered included profitability,
ability to operate, reputation, and value
provided to society and the environment.
The outcome was an ordered list of
material issues ranked by their potential
business impact.
2
REPORTING

WHAT MATTERS

FIGURE 1: Sanford materiality matrix for 2020
012345
678910
0
1
2
3
4
5
6
7
8
9
10
STAKEHOLDER CONCERN
BUSINE
SS IMP
A
CT
IMPORTANT
IMPOR
T
ANT
MATERIAL
MA
TERIAL
Innovation in
products & markets
Regulatory risk
management
Environmental
footprint
Operational excellence
Responsive fisheries management
Maximising $/kg
Health, safety & wellbeing
Food safety & quality
Sustainable seafood
Alternative proteins
Climate change
World-class brand
Biosecurity
Resilient supply chains
Collaboration
Traceability &
provenance
Plastics in the ocean
Trust in seafood industry
Community support
World-class employer
Sanford leads
NZ seafood
Communication
Shared vision and values
PERFORMANCE OUTCOMES
ENABLING HEALTHY OCEANS AND
PROTECTING AND ENHANCING
THE ENVIRONMENT
BUILDING A SUSTAINABLE
SEAFOOD BUSINESS
LEADING THE WAY TO HEALTHY
FOOD AND MARINE EXTRACTS
SUPPORTING STRONG
COMMUNITIES AND PARTNERSHIPS
CREATING A SAFE AND HIGH
PERFORMING WORKPLACE
DELIVERING CONSUMERS’
EXPECTATIONS
TOP ISSUES FOR 2020
This matrix shows the top 23 issues,
grouped into the six performance outcome
areas that we focus on through this Report.
We also highlight issues that align with
our enterprise risk process, and summarise
key mitigation strategies for these in
Appendix B. The focus on these issues
in the Report reflects the importance that
both the business and our stakeholders
placed on these issues.
In 2020, our top 12 issues by their potential
business impact are:
1st= Sustainable seafood
1st= Food safety and quality
1st= Health, safety and wellbeing
of our people
4th= Shared vision and values
4th= Maximising $/kg of harvest,
driving profitability
6th Responsive fisheries management
7th Transparent and effective
communication
8th= Resilient supply chains to final markets
8th= Resilience to biosecurity risks
8th= Operational excellence
8th= Minimising Sanford’s environmental
footprint
8th= Regulatory risk management
Our top three issues remain the same as last
year: Sustainable seafood, Food safety and
quality and Health, safety and wellbeing.
These issues were ranked as the top three
by both stakeholders and by Sanford’s
Executive Team and Management Leads.
These three issues highlight that we must
strive towards safe, healthy food and
marine extracts that are produced in
a way which respects both the natural
environment and our own people.
Climate change resilience was one of the
lowest ranked issues by both stakeholder
concern and business impact relative to
the other issues. Yet, at the same time,
climate change has been identified as
Sanford’s #1 business risk. This deviation
likely comes from three key areas. First,
climate change can be considered to be
24Sanford Annual Report 2020
REPORTING WHAT MATTERS
2
REPORTING WHAT MATTERS

25
part of, and a contributor to, Sustainable
seafood (ranked 1st equal). Second, many
of the other actions that would be part of
this issue are already identified separately
elsewhere, e.g. Resilience to biosecurity
risks. Third, ‘risk’ and ‘business impact’
have slightly different meanings: ‘risk’
implies a potential loss of something,
whereas ‘business impact’ considers
both the positive and negative dimensions
of an issue.
Eliminating plastics in the ocean – our only
new issue for this year – received a very
low ranking. This is somewhat surprising
given that plastics in the environment
consistently ranks as one of the top
sustainability issues for New Zealanders
in Colmar Brunton’s annual Better Futures
report. However, this may be partly because
this issue cannot be resolved by Sanford
alone, and partly because the related issue
Sustainable seafood is already ranked
1st equal.
INTERCONNECTIONS BETWEEN ISSUES
The most common comment from
stakeholders regarding this process is that
the issues are difficult to rank as they are
interconnected. To help demonstrate these
interconnections, a fishbone diagram has
been created (Figure 2). Sanford’s vision
is shown to the right (the direction the fish
is moving). The main contributors to this
vision (the pillars of Sanford’s Business
Excellence Framework) are shown as the
ribs/tail. Individual issues/causes are shown
as feeding into the ribs. The most important
issues (as determined by their potential
business impact) are placed closest to
the spine of the fish. The top-three issues
(ranked first-equal by business impact)
are shown in bold.
ENGAGING WITH STAKEHOLDERS
We take stakeholder engagement
seriously, investing heavily in continuing
to improve engagement processes, and
developing positive relationships founded
on shared understanding. We recognise
that the individual stakeholders within key
stakeholder groups are diverse, often with
different interests and concerns, and so we
work hard to address this challenge within
our engagement. Further details of the
roles of our respective stakeholder groups,
including principal memberships and the
key roles that Sanford representatives
contribute, are set out in Appendix C.
The fishbone diagram shows the interconnectedness between the material issues, arranged along a
performance outcome bone structure. This illustrates how all the issues sit within the performance
outcomes and feed into our vision to be the best seafood company in the world.
Strong
communities
Healthy
oceans
Healthy
products
Delivering consumers’
expectations
Sustainable seafood

business
THE BEST SEAFOOD COMPANY IN THE WORLD
Safe & high-performing
workplace
Collaboration
Plastics in the ocean
Climate change
Sanford leads NZ seafood
Biosecurity
Community support
& connection
Trust in seafood industry
Food safety & quality
Traceability & provenance
Environmental footprint
Sustainable seafood
Responsive fisheries
management
Communication
Regulatory risk
management
Innovation
Health, safety & wellbeing
World-class brand
Maximising $/kg
Shared vision & values
World-class employer
Alternative proteins
Operational excellence
Resilient supply chains
2
REPORTING

WHAT MATTERS

ADDRESSING MATERIAL ISSUES THROUGH OUR BUSINESS EXCELLENCE FRAMEWORK
Addressing the most material issues is our priority at Sanford. We achieve this through our focus on the
six outcomes which are described in the performance section of this Report (on pages 27 to 78). In the
diagram below, we link the material issues to the performance outcomes and identify the overall priority
of each to the stakeholders we consulted through our stakeholder engagement and materiality processes
over the last four years: 2017-2020 (the ranking is shown below in brackets beside each material issue).
CREATING A SAFE AND
HIGH PERFORMING
WORKPLACE (page 37)
• Health, safety & wellbeing (1=)
• Shared vision and values (4=)
• World-class employer (14=)
ENSURING HEALTHY OCEANS AND
PROTECTING AND ENHANCING
THE ENVIRONMENT (page 27)
• Sustainable seafood (1=)
• Responsive fisheries management (6)
• Environmental footprint (8=)
• Sanford leads NZ seafood (13)
• Trust in seafood industry (17=)
• Climate change (21)
• Plastics in the ocean (23)
SUPPORTING STRONG
COMMUNITIES AND
PARTNERSHIPS (page 53)
• Community support (14=)
• Collaboration (17=)
DELIVERING CONSUMERS'
EXPECTATIONS (page 61)
• Traceability & provenance (17=)
• World-class brand (20)
• Alternative proteins (22)
BUILDING A SUSTAINABLE
SEAFOOD BUSINESS (page 69)
• Maximising $/kg (4=)
• Communication (7)
• Operational excellence (8=)
• Regulatory risk management (8=)
• Resilient supply chains (8=)
• Innovation in products & markets (14=)
LEADING THE WAY TO
HEALTHY FOOD AND
MARINE EXTRACTS (page 45)
• Food safety & quality (1=)
• Biosecurity (8=)
26Sanford Annual Report 2020
REPORTING WHAT MATTERS
2
REPORTING WHAT MATTERS

Enabling Healthy
Oceans and
Protecting and
Enhancing the
Environment
The stories in this chapter reflect our appreciation of
our place in the world, in the actual sense of physical
place. We are proud to be a New Zealand company
offering beautiful New Zealand seafood to our country
and the wider world. We can do this because of the
relative health of the oceans in which we farm and
from which we fish. Sustainable seafood is a first equal
ranked issue amongst the stakeholders surveyed in our
2020 Materiality Assessment. Responsive fisheries
management is also in the top ten.
Helping to keep our oceans and fish stocks healthy
is an absolute priority for us.
Our commitment is to lead by example in the
management of the marine environment, so that
future generations can enjoy and benefit from our
biologically diverse, safe and healthy oceans. We will
work with our people, communities, customers and
suppliers to lead the way in maximising resource
utilisation, minimising our footprint and protecting
the environment wherever we operate.
CRAIG STONYERSTEWART ISLAND

46°58‘50.2“S 168°06‘48.1“E
2727

Material issues and value creation
This table summarises Sanford’s material issues and associated actions relating to enabling healthy
oceans and protecting the environment. It includes the strategic goals within our Business Excellence
Framework, our targets for 2020, and our progress against these targets. At the end of this section,
we define our future targets and vision through to 2025.
MATERIAL ISSUES AND
STRATEGIC GOALS2020 TARGETSPROGRESS AGAINST TARGETS
Sustainable fish stocks,
marine farms and
marine conservation
Comply with all laws and regulations
governing our operations, including
relevant international conventions,
recognising the importance
of healthy ocean and
farming management.
All fishers to record and report
their catch to ensure maximum
transparency of the fish stock status
and to comply with all fisheries and
marine regulations at all times.
Key target is no prosecutions.
Not achieved. Vessel catches reported to the relevant
fisheries regulator in accordance with compliance
requirements. Sanford continuous live reporting to
MPI identified that one of our vessels had unintentionally
conducted fishing activities within a Benthic Protected
Area (BPA). Electronic geo-fences around protected areas
have been reviewed within our systems along with the
associated early warning alarms and notifications.
Continue engaging with
New Zealand’s Deepwater Group
and Fisheries Inshore NZ such
that the industry collaborates to
ensure the health of NZ fish species
under the Quota Management
System (QMS).
Actively engage with regulators and
publish submissions on proposed
legislation as the opportunity arises.
Achieved. Sanford continues to be actively involved with
both the Deepwater Group and Fisheries Inshore NZ.
Through those groups, Sanford actively participated in,
and submitted on, the 2020 sustainability rounds for
QMS fisheries. The industry came together again in 2020
to support a voluntary reduction in hoki catch limits as
a precautionary step to protect the sustainability of this
important species.
Maintain third party certifications
across Sanford aquaculture farms,
validating our commitment to
farm efficiently and deliver
sustainable seafood.
Achieved. Farm based eco-certifications retained for
Best Aquaculture Practices (across Big Glory Bay (BGB)
Greenshell™ mussel farms, Salmon farms and hatcheries);
Certified Organic (BGB mussels); A+ NZ Sustainable
Aquaculture (mussel farms); Marine Farming Association
environmental certification (Nelson/Marlborough based
aquaculture vessels).
Positively participate in all
New Zealand stakeholder audits
(for example QMS, environmental
and Maritime NZ’s Marine Operator
Safety System [MOSS]), with the
target of achieving clean audit
findings. Where recommendations
are made, put in place improved
processes, controls and reporting
structures to ensure all
recommendations are actioned.
Achieved. All stakeholder audits were undertaken with
a constructive, improvement-based approach. No major
non-conformances were identified during any of the
audits, and where there were minor findings or observations,
corrective and preventative actions were put in place,
within the required time-frames in accordance with
audit recommendations.  
Support Marine Stewardship
Council (MSC) sustainability
certification for deepwater
species in New Zealand’s
Exclusive Economic Zone (EEZ).
Achieved. Sanford's role supporting MSC certifications for
deepwater species extended to fisheries within New Zealand's
EEZ, and beyond. Sanford supported the Government of South
Georgia and the Sandwich Islands in their MSC certification
of their toothfish resources, where Sanford participated in
that fishery. Further, Sanford used its industry position to
support work towards additional deepwater species entering
the MSC program. In 2020 45% of our total wildcatch by
greenweight tonne (GWT) was MSC certified (FY19:36%),
the increase being attributable to hoki making up a greater
proportion of our deepwater species mix during FY20.
28
Sanford Annual Report 2020
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MATERIAL ISSUES AND
STRATEGIC GOALS2020 TARGETSPROGRESS AGAINST TARGETS
Endangered, threatened
and protected species
Ensure protection of marine
species, including seabirds, sea lions,
dolphins and sharks through
delivering best practice farming and
fishing practices, implementing
protection measures and
participating in ongoing robust
research programmes.
Continuous improvement in the
protection of marine species,
reducing fatal interactions.
Ongoing. We continue to focus on initiatives, research,
and partnerships such as the Black Petrel Working Group,
and MAUI63 collaboration to reduce our interactions with
endangered, threatened, protected, and non-target species.
Improved practices have resulted in reductions in marine
mammal interactions with Sanford vessels over the past
three years. We recognise the value of transparent reporting
and use this to strive to improve our performance.
We disclose our vessels interactions with marine mammals
and seabirds in the table on page 34.
Work with World Wildlife Fund
(WWF) and Moana New Zealand
to support more detailed work
improving understanding of the
financial and fisheries management
issues associated with transitioning
from set-netting and conventional
trawling. While we believe that this
should be led by MPI, we commit
to engage constructively and
proactively in these discussions.
Achieved. Our partnerships with WWF and Moana
progressed throughout 2020 with significant investment in,
and the initiation of technological research work into trawl
monitoring and aerial drone monitoring of Māui-Hector
dolphin populations. Sanford recognises the Government's
Māui-Hector Threat Management Plan announcement
during 2020 and was pleased to see within that a transition
plan for those affected fishers.
Environmental Effects
Focus on having no adverse
impact on the environment
when carrying out our business
operations, avoid pollution
or contamination of land,
air and water and enhance
the environment in which
we operate through sound
management and mitigation.
Maintain certification to the
updated ISO 14001:2015
Environmental Management
System (EMS) standard across
all of our operations.
Achieved. ISO 14001:2015 surveillance audits were
successfully performed across Sanford’s EMS leadership
and management, Havelock processing, farms, fleet,
and Bluff/Stewart Island operations. Sanford maintains
a culture of continual improvement and enhancement
to its Environmental Management System.
No abatement notices across
the group.
Achieved. No abatement notices received during FY20.
Improvement projects are underway for key discharges,
including Timaru process site thaw water which comprises
physical and process controls in an effort to divert that
discharge from tradewaste.
Appropriately and sufficiently
resource the environmental team
to ensure a robust management
process is consistently applied
across the business so that legal
compliance is met and all critical
environmental risks are identified,
monitored and mitigated.
Achieved. Our core environmental team grew during
FY20, with assigned representatives being in place across
all sites. The team has undergone training in Environmental
Management Systems and improvement projects are
underway at all operational sites. Environmental functions
are being supported by supplementary deployments of
devices for environmental control, pollution mitigation,
and energy monitoring. We also employed a new General
Manager Sustainability, Dr Peter Longdill, during FY20 to
support our efforts towards becoming the best seafood
company in the world.
Launch and successfully implement
new software for capturing and
reporting environmental data.
This will facilitate the measurement
of non-conformance of
environmental KPIs and will provide
clarity of actions and improvement
areas for management to remedy.
Additionally, the new system will
provide an initial benchmark for
key KPIs going forward from 2020.
Achieved. A new environmental data software platform
(Sphera) has been rolled out successfully and is in use across
all Sanford sites, recording data related to energy, fuel,
water, carbon emissions, and waste. All environmental
advisors and managers have been successfully trained in
data upload, analysis, and reporting. This environmental data
management software is also supported by supplementary
systems (Intelex) to monitor and respond to environmental
incident management needs.
29
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MATERIAL ISSUES AND
STRATEGIC GOALS2020 TARGETSPROGRESS AGAINST TARGETS
Resource Utilisation
and Efficiency
Do more with less by maximising
efficient use of resources and
ensuring waste minimisation,
re-use and recycling.
Achieve year-on-year water
intensity improvements at all
land-based processing sites when
compared to total sales by site
(Litres/Sales $).
Not Achieved. Water intensity increased by 15% during FY20.
The water intensity metric was negatively influenced by both
more water intensive cleaning processes within our factories
during the Covid-19 pandemic and the effect of the
pandemic on sales.
Reduce the core energy intensity
at our land-based processing sites
relative to 2019 (MJ/Sales $).
Not Achieved. After substantial improvements in this metric
during FY18 and FY19, energy intensity increased by 14%
year-on-year during FY20, primarily attributed to Covid-19
related changes in sales $.
Improve on the 2019 waste
diversion rate across all of our
operations, targeting plastic waste
streams as a key priority to reduce.
Achieved. 17% improvement on FY19 waste diversion rate
achieved across Sanford operations in FY20 to reach a waste
diversion rate of 31% across all operations.
Carbon reduction
and offsetting
Demonstrate our commitment
to climate change responses
by actively reducing our energy
consumption and emission of
greenhouse gases and seeking to
introduce low carbon solutions into
our value chain, where practicable.
Reduce our net carbon emission
intensity year-on-year across all
of our operations comparing
CO
2
 per kg relative to revenue
(CO
2
-kg/ Revenue $).
Not Achieved. 18% increase in carbon emissions intensity
relative to FY19. This metric was adversely affected by the
effect of the global pandemic on sales during FY20.
Use fewer giga watt hours of
energy year-on-year across
all land-based operations.
Achieved. During FY20 a reduction of 7% in land-based
energy use was realised. A program of work commenced in
collaboration with EECA to identify opportunities for energy
reductions across our stationary energy consuming operations.
PHOTO: The crew of Sanford’s mussel barge Lady Marie on a beach clean-up in the Marlborough Sounds
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ENABLING HEALTHY OCEANS AND PROTECTING AND ENHANCING THE ENVIRONMENT

New Zealand has one of the largest Exclusive
Economic Zones (EEZ) in the world. At four million
square kilometres it’s considerably bigger than
our 268,000 square kilometres of land mass and
is an abundant source of food.
Just as agriculture needs fertile land, clean water and
environmentally sustainable management, our fishing
and aquaculture operations depend on the ocean’s health
and its ability to provide a food resource which is remarkable
for its biodiversity.
In aquaculture, we respect and care for the sea, knowing that if
we harm the environment, we also harm ourselves. In Stewart
Island’s Big Glory Bay, where we have farmed since 1994, we have
amassed a wealth of environmental knowledge which constantly
guides today’s operations and our plans for future expansion.
Our reward this year was an abundance of salmon in peak condition.
We were certainly helped by good conditions. There were no
harmful algal blooms or marine heatwaves, just favourable
weather in a beautiful part of the country. As General Manager
of Aquaculture, Ted Culley says, “it was an outstanding season
from a performance perspective” with 4,731 greenweight
MT harvested, compared to 4,028 MT last year.
“Our team was extremely focused on optimising performance
of the fish during the season. We followed a best practice
nutritional advice model, tweaking the diet to support fish health
and performance over the summer period. We were constantly
monitoring fish health and growth characteristics, ensuring great
end results were being consistently delivered.”
He says the farm also diversified its nutritional partnerships
this year, undertaking feed trials with Biomar as a supplier to
complement the 25-year long standing partnership with Skretting.
“We undertook these trials to help us understand the potential
benefits between different diet philosophies.”
What the season has clearly established is that the refinements
to how we farm and particularly how we feed, will pay sustainable
dividends in terms of quality and fish performance in changing
environmental conditions. That’s invaluable, with our farm
expansion, consented in April 2019 and planned staging for
the next three to five years now underway.
We have eight new pens on the farm, which will give us the potential
to increase production by a further 350 MT, with the first harvest
in 2021, bearing in mind the three-year salmon growth cycle.
Growing Responsibly to Secure the
Future of Food from the Sea
ENABLING HEALTHY OCEANS AND PROTECTING AND ENHANCING THE ENVIRONMENT
1. Financial Capital
2. Human Capital
3. Manufactured Capital
OUTCOME
INPUTSUN SDG
1
2
3
4
5
6
4. Intellectual Capital
5. Natural Capital
6. Social & Relationship Capital
United Nations
Sustainable Development
Goals
Enabling Healthy Oceans and
Protecting and Enhancing
the Environment
31
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Our new barge became operational by early November 2020.
Constructed in Hobart and towed across the Tasman by a tug, the
26 metre-long barge commissioned in Hobart is a $5.8 million
replacement for our current Kiwa barge which will be
decommissioned.
Ted says it is a step-up in working conditions for our divers and farm
team, with an on-board fish health lab and 200MT feed capacity.
“The investment not only gives us more feed silos, but also more
sophisticated feed delivery options which we can vary seasonally,
switching from growth focused feeding to a health package which
enables the salmon to do well over warmer summer months.”
AQUACULTURE’S SUSTAINABLE POTENTIAL
Aquaculture has a relatively small environmental footprint,
compared to other protein sources and we are confident in
our ability to responsibly and sustainably produce both food
and marine extracts. This is important, given the growth in
global demand for protein from sustainable sources.
A research paper
1
published in the journal Nature in August 2020,
analysed the future of food from the sea and concluded that
by 2050, supply could increase by 21–44 million tonnes by
2050, a 36–74% increase compared to current global yields.
This represents 12–25% of the estimated increase in all meat
needed to feed 9.8 billion people by 2050.
“In addition to protein, food from the sea contains bioavailable
micronutrients and essential fatty acids that are not easily found
in land-based foods and is thus uniquely poised to contribute to
global food and nutrition security,” the paper says.
Finding companies that
share moral ground with
me is important. I want to
spend my money so that I
do as little harm as possible.
I don’t think we can avoid
harm at this point, but I do
want to try to minimize
harm through my spending.
—
Michael Hung
EXECUTIVE CHEF
FAITH & FLOWER LOS ANGELES
The best seafood company
in the world is focused on
longevity, it would be a
tragedy if fish wasn’t part
of the diet in 100 years
from now.
—
Paulie Hooton
HEAD CHEF
SANFORD
8 new
pens
350 MT
POTENTIAL INCREASE
IN PRODUCTION
ALLOWING FOR REDUCED
PEN DENSITY
BIG GLORY BAY
– A GROWING FARM –
WATCH VIDEO
San Hāmana two minute tour
https://youtu.be/33IRiKCVtow
1. Costello, C., et al. The Future of Food
from the Sea. Nature (2020)
32Sanford Annual Report 2020
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We agree that protein from the sea has tremendous potential to
make a significant contribution to the UN’s Sustainable
Development Goals. Our own approach to increasing its availability
has close connections to the UN’s goals around decent work and
economic growth, industry, innovation and infrastructure,
responsible production and consumption, climate action and life
below water.
FUTURE INVESTMENT
Our investment in aquaculture in Southland is further expanding
with the development of a new Recirculating Aquaculture System
(RAS) hatchery in the Bluff area, for which an $8 million loan has
been secured from the Provincial Growth Fund. Stage one of the
development will enable 1.5 million smolt to be produced that could
support a harvest of 6,000 MT of salmon. Smolt produced will also
be made available to other salmon farmers in the region.
“Our RAS hatchery will be state-of-the-art using the best
systems available to create an idea growing environment
for smolt,” says Ted.
We see the South as the engine room of our salmon growth
strategy. We have now lodged two resource consent applications
as our first step in expanding into open ocean salmon aquaculture.
Growing Responsibly to Secure the Future of Food from the Sea
CONTINUES
Both applications are now on hold, at our request, to enable full
consultation and engagement with all stakeholders and especially
with tangata whenua. We are also engaging with Government and
scientists on the development of a suite of national open ocean
guidelines, to ensure consistency across regions on water quality,
monitoring and marine mammals.
Our application to the Southland Regional Council covers five
farming areas in the open ocean, 28 km from Bluff and 10 km
from the nearest Island, at the south east end of Foveaux Strait.
Our second application is to the Otago Regional Council and
covers two farming areas, north east of Dunedin.
We are working with leading international experts in open ocean
moorings who are developing bespoke pen systems designed
to New Zealand conditions. Open ocean technology includes
submersible fish pens that will allow the farm to drop below the
high energy wave action in severe weather, making coastal waters
that have been largely inaccessible for farming now a possibility.
We are also working with ecological experts to ensure that our
new farms will not adversely affect marine mammals and seabirds,
and with biosecurity experts to predict and avoid the spread of
any unwanted marine flora or fauna. A big job, giving us plenty of
challenge to welcome and energetically navigate in the years ahead.
PHOTO: Joe Bagnall, part of the Stewart Island harvest team, spent the full Alert Levels 3 and 4 and on the salmon farm
33
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Keeping Marine
Mammals Safe
We do everything in our power to protect Māui dolphin.
As Our Chief Operating Officer Clement Chia says,
“ we believe that the worst thing that can happen
at Sanford is the death of one of our people but the
second worst would be the death of a Māui dolphin –
that’s how strongly we feel about this.”
In 2016 we introduced our Māui Dolphin Protection Plan
in partnership with fishing company Moana and with WWF
New Zealand. We sat down again with our partners in 2019,
when the Government announced the four options for its
Threat Management Plan (TMP) for Hector’s and Māui dolphins
– what would the TMP mean for the programme we already had
in place? That led to the creation of Option 5, our alternative
way to balance the needs of fishing communities and families
with effective methods for keeping Māui and other marine
mammals safe.
In June this year, we were delighted to see the government put
forward a transition plan for those who may lose their fishing-
dependent livelihoods because of the new measures. We also
welcome the Government support for more investigation into
toxoplasmosis, which we sought because we believe the science
shows the disease is a more severe threat to dolphins than
responsible fishing.
“The Government’s transition plan for fishers is absolutely the
right thing to do,” says Clement. “The changes for set net fishing
are extensive and fishers will need assistance as a result. There are
operational impacts both for our direct operations and for those
who supply fish to Sanford.”
We are also welcoming the plan to expand on-board cameras to
the New Zealand commercial inshore fishing fleet. We already
have cameras on our vessels operating off the West Coast of
the North Island.
Sanford is also excited to support a new way to monitor and
understand the habits of the Māui dolphin. WWF-New Zealand
and MAUI63 are leading a new scientific programme to follow
these rare mammals with unmanned drones and their associated
AI. They will keep an eye on them from an appropriate distance,
collecting real-time information which will ultimately help
scientists, regulators and all marine users to understand the
dolphins’ seasonal movements and behaviours. This data will
ensure that the right protections can be in place, at all times.
Sanford’s General Manager of Fishing, Colin Williams says having
more definitive information about where these dolphins are, will
enable us to avoid them in real time and reduce or eliminate any
residual risk to the dolphins from our limited fishing activity.
“It will add to the protection measures we have had in place
since 2016 and enable us to do more. Ideally if we have real time
information a dolphin is in a location, we will be able to respond
immediately and leave the area, giving the dolphins all the space
they need.”
MPI Summary Of Sanford’s Reported Incidental Catch Data
1
SEABIRDS
MARINE
MAMMALS
2
202020192018202020192018
Uninjured 14083173356
Injured 232000
Dead 220164234334671
Total 362250409365177
Mortality Rate (%)
3
61%66%57%92%90%92%
1. Data covers Sanford registered vessels
over the period from July 2019 to
June 2020, reflecting data availability
from MPI.
2. For context, since our records began,
Sanford has never harmed a Māui dolphin.
3. Mortality rate is calculated as the ratio
between total species caught and dead.
MĀUI DRONE
PROJECT
PARTNERSHIP BETWEEN MAUI63,
WWF-NEW ZEALAND, MPI, SANFORD,
AND MOANA – A NEW SCIENTIFIC
PROGRAMME WITH UNMANNED DRONES
TO MONITOR AND RESEARCH
PHOTO: The MAUI63 team supported by Sanford are Willy Wang, Associate Professor Rochelle Constantine and Tane van der Boon
34Sanford Annual Report 2020
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Covid-19 is sharpening up our focus on
the impact that humans have on our
environment. I think it is a great
opportunity for Sanford to take a leadership
role on sustainability challenges. I think
we need to go beyond market regulation.
—
Fiona Mackenzie
SANFORD DIRECTOR
Mapping our
Carbon Footprint
We know climate change affects us. That’s evident in
impacts such as algal blooms and marine heatwaves
which have affected our aquaculture farms and extreme
weather conditions for fishing. It is a risk to the business.
This year we’ve intensified our scrutiny of how we’re affecting
climate change ourselves, starting with an independent audit
across all of our operations.
This audit assesses direct emissions from fishing, farming and
processing activities, as well indirect emissions throughout our
supply and value chains. These include emissions from energy
providers, transport operators, companies providing us with
goods and services from fish meal to packaging, as well as those
generated by our own international travel and investments.
General Manager of Quality and Environment, David Jones, who
is leading the work, says that while we have measured emissions
previously, having a verified inventory establishes a benchmark
and enables a new level of discipline in decision-making.
General Manager of Sustainability Dr Peter Longdill says reducing
our carbon emission intensity year-on-year is an important goal and
the audit undertaken this year is a step forward, enabling a formal
carbon reduction pathway to be developed and acted on.
“The carbon reduction pathway will identify the quick wins and the
incremental ones. But it will also influence decision-making at the
operational level for everyday procurement and extend through to
management and board level thinking when it comes to major asset
investments, such as our scampi fleet.”
Peter says long life assets, such as vessels, have refits and
scheduled services through their operational lifetimes and these
can be built into the reduction pathway so incremental
improvements can be achieved.
Ultimately the work will enable Sanford to make verifiable claims
about the carbon footprint of our products, and will form the basis
for an emissions reduction pathway that is aligned with national and
global climate targets.
After increasing the scope of our emissions measurement from
upstream and downstream sources during FY20, we determined
that our direct and indirect activities contributed a total of 276,363
tonnes of CO
2
-equivalent greenhouse gas emissions for the year.
This forms the reliable baseline upon which we can use to further
develop and measure our performance towards longer term
emissions reductions targets.
* Based on Sanford’s total wildcatch (by GWT) for 2020. Deviations reflect
fluctuations with seasonality, annual catch entitlements, species composition
and climate events such as El Niño/la Niña.
37%
2016
46%
2017
44%
2018
36%
2019
45%
2020
Wild caught MSC certified catch*
SANFORD RECORDED
3 notifiable spills
IN 2020 TOTALLING 45 LITRES
COMPARED TO 2 SPILLS IN 2019
TOTALLING 10 LITRES
ACHIEVED
TOITŪ ENVIROCARE ASSURANCE OF
SANFORD’S FY2020 EMISSIONS
INVENTORY FOR SCOPE 1, 2, AND 3 IN
ACCORDANCE WITH ISO 14064-1:2006
FOR GREENHOUSE GAS EMISSIONS
35
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MATERIAL ISSUES AND
STRATEGIC GOALS2021 TARGETSOUR 2025 VISION
Sustainable Fish Stocks,
Marine Farms and
Marine Conservation
Comply with all applicable laws
and regulations governing our
operations, including relevant
international conventions,
recognising the importance
of healthy ocean and
farming management.
Actively support the rollout of cameras across New Zealand’s
commercial fishing fleet to promote transparency in fisheries
reporting and management.
Sanford continues to play a key and
influencing role within the New Zealand
fishing and aquaculture industries to
support the sustainable management
of fish stocks and marine farms.
Roll out and implement best practice environmental codes
from the MFA (Marine Farming Association) for our
aquaculture vessels throughout the country, using those
codes already applied in the Marlborough/Tasman region
as the model.
Promote and support fisheries management to ensure
the sustainability and resilience of fish stocks by actively
engaging with the industry on QMS submissions, supporting
MSC certifications for deepwater species, and ensuring full
catch reporting for our activities.
Endangered, Threatened
and Protected Species
Ensure protection of marine
species, including seabirds,
sea lions, dolphins and sharks
through delivering best practice
farming and fishing practices,
implementing protection measures
and participating in ongoing robust
research programmes.
Achieve year-on-year reduction in interactions with marine
mammals and seabirds through continuous improvement
measures, and participation in cross-sector working groups,
and targeted partnerships.
Sanford’s operations are performed with
precision and with negligible adverse
impact on non-target species and wildlife.
Environmental Effects
Focus on having no adverse impact
on the environment when carrying
out our business operations, avoid
pollution or contamination of land,
air and water and enhance the
environment in which we operate
through sound management
and mitigation.
Ensure no environmental abatement notices across the
group and maintain certification to the ISO14001:2015
standard across our operations.
Sanford's limited impact on the
environment is aligned with best practice.
Resource Utilisation
and Efficiency
Do more with less by maximising
efficient use of resources and
ensuring waste minimisation,
re-use and recycling.
Achieve 3% resource efficiency improvements across land
based processing sites for water (Litres/GWkg) and energy
use (MJ/GWkg) along with a waste diversion rate which
exceeds 35% diversion from land-fill across all operations.
Sanford is a responsible user of resources,
and where practicable applies renewable
solutions and circular concepts toward
materials, resources and wastes.
Initiate a sustainable packaging program; starting with
identifying current and future circular packaging options.
Carbon Reduction
Demonstrate our commitment
to climate change responses by
actively reducing our energy
consumption and emission of
greenhouse gases and seeking to
introduce low carbon solutions into
our value chain, where practicable.
Reduce our carbon emission intensity (CO
2
-e kg/GWkg)
by 2.5% across all of our operations for emissions which
are in our direct control (Scope 1 and Scope 2 emissions),
and work collaboratively with suppliers and partners to
reduce emissions intensities in our value chain.
Sanford maximises the use and
application of energy conservation,
efficiency, and renewable energy sources
to provide low-carbon human nutrition
and marine extracts.
Our future focus
36Sanford Annual Report 2020
3.1
PERFORMANCE OUTCOME:

HEALTHY OCEANS
ENABLING HEALTHY OCEANS AND PROTECTING AND ENHANCING THE ENVIRONMENT