Tassal Group, Australia's biggest producer and exporter of Atlantic Salmon has reaffirmed its commitment to achieving the net profit after tax as laid down in the prospectus issued by the company last October. The prospectus included the forecasts on both a SGARA basis (as required by a provision of the Australian Accounting Standard) and excluding it, and the company has said it would report on both these methods for the period ending 30th June 2004. Further the company said tough market competition from lower priced crustaceans and white fish and widespread scare of chemicals in fish had considerably affected its gross revenue and operating margins. However, the company has revealed that the commencement of business before three weeks, well

ahead of the prospectus assumption coupled with the savings in depreciation and income tax had offset the negative factors. Consequently, the company expects an after-tax profit of $7.3 million after the accounting adjustment for the value of livestock is included. The profit would be slightly above the forecast amount of $3.5 million without the adjustment. Tassal has announced that its lower production costs would equip the company to face the future. Among the several initiatives the company has adopted to cut production costs, the transfer of value added activities of Mornington operation to the Huonville factory is notable. The company has also pinned its hopes on the favourable growing market conditions in the summer months, which would ensure a 30 per cent increase in the salmon biomass. The company has also said it would ensure that extra fish is sold at good margins.