The revolving door outside the boardroom of budding aquaculture producer Marine Produce Australia, which has been spinning fast for the past year, hit top speed this month.
The revolving door outside the boardroom of budding aquaculture producer Marine Produce Australia, which has been spinning fast for the past year, hit top speed this month.
Chairman Miles Kennedy, who also chairs Kimberley Diamond Company, returned from a trip to the Diggers & Dealers conference to discover that managing director Peter Fraser and director Michael Firmin had both resigned without explanation. Company secretary Hugh Lennerts also left shortly after his return.
He filled the board vacancies by recruiting the company’s lawyer and re-appointing two people who left the board only six months ago.
The new directors are John Hutton, who had been managing director until February, Nicholas Miller, who had been a non-executive director until February, and lawyer John Drummond.
These changes follow several other boardroom moves over the past nine months, including the resignations of executive chairman Ashley Zimpel and non-executive directors Karl Simich and Tor Theunissen.
The board changes come at an unfortunate time for Marine Produce, which needs to raise extra capital to fund its planned capital spending program.
Mr Kennedy said he would seek to continue the $9 million capital program that was agreed in February when he joined the board.
Marine Produce raised $3 million in March through a four cents per share rights issue, which included a bonus issue of options to shareholders.
The first tranche of options, which would raise a further $3 million, is due to be exercised in September but the share price has fallen below the exercise price of four cents.
“The $3 million will still need to be found, whether it’s at four cents or whatever, the market will decide,” Mr Kennedy told WA Business News.
He said the company would continue with its expansion plans, which include the establishment of 15 hectares of prawn ponds at Darwin and 12 barramundi sea cages off the Kimberley coast.
“You need a certain scale for this operation before you become profitable.”
Mr Kennedy said the company had met or exceeded all of its operating targets since he joined, which gave him confidence about its long term prospects.
The planned expansion program would take the company to a break-even situation by June next year, he claimed.
The board changes reinforce the close links between Marine Produce and Broome pearl producer Maxima Pearling Company.
Mr Hutton’s family owns Maxima and Mr Miller is its managing director.
Marine Produce’s June quarter report showed the business had just $119,000 in sales and burned $1.6 million in cash, leaving just $1.4 million cash at the end of the quarter.
