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Briefcase: Business snippets from around South Australia

Business

In this week’s briefcase, Tindo Solar is set to resume exports to Vietnam, Clean Seas announces record Kingfish sales in March and Santos finalises a sell-down in two Top End projects.

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Tindo Solar to resume exports to Vietnam

Adelaide solar panel manufacturer Tindo will resume exporting to Vietnam following the release of a new generation panel last week.

Tindo Solar, Australia’s only solar panel manufacturer, started exporting to Vietnam in June 2018 with a 295-watt module.

However, COVID-19 and expectations of solar panel upgrades have delayed new shipments since 2020.

Tindo Solar CEO Shayne Jaenisch said the new 400-watt, 72-cell solar module would replace the 380-watt model that had enjoyed success in the Vietnamese market.

He said the Mawson Lakes-based company had filled consistent orders from Vietnam in the past three years as the Southeast Asian nation pursued energy independence from China.

“Like many buyers of solar panels, our Vietnamese customers have been through the cycle of going for the lowest costs and are now changing their focus to quality and sustainability,” Jaenisch said.

“Our Australian panels are built to handle the harsh summers, so we have quality cells, quality glass laminate and individual testing of finished panels. We guarantee our panels for 25 years while imported panels have a 10-year warranty.”

Jaenisch said if Australia was to fully partake in the renewables boom over the coming decades, it would need its own manufacturing base and that would have to be supported by government procurement policies, as it is in India’s Production-Linked Incentive.

“In Australia’s three levels of government, only one department – the Department of Defence – specified domestically-made solar energy infrastructure, which it did for security reasons,” he said.

“The Clean Energy Council expects the Australian solar energy market to grow by between $5 billion and $10 billion per year until 2030, and yet we have one solar panel maker in this country.

“Even the glass for the panels is imported, although Australia has the best raw materials to make the glass. What industry needs is scale and that requires orders.”

Tindo Solar says a move by consumers towards Australian Made products during the. COVID-19 pandemic has resulted in a 40 per cent increase in retail and 70 per cent in wholesale orders.

Record kingfish sales month for Clean Seas

Spencer Gulf kingfish farmer Clean Seas Seafood recorded a record sales month in March on the back of rising domestic restaurant and retail sales and a major shipment to North America.

The listed company reported to the ASX on Friday that it sold 425 tonnes of kingfish in March, including a 130-tonne sale to Hofseth North America to support new channel launches in that market.

This, coupled with the recovering restaurant sector and an increased focus on domestic channels helped Clean Seas reach 880t of sales that generated record third quarter receipts of $12.8 million.

The company said this was also achieved despite ongoing restrictions in Europe, a market that accounted for 40 per cent of Clean Seas’ sales pre-COVID-19.

“The encouraging result reflects the significant rebound in the Australian market and the diversification into new retail channels and markets,” the company said in its ASX statement on Friday.

“It is the company’s view that whilst the ongoing COVID-19 disruptions will continue, the entry into retail product distribution is expected to deliver long-term volume and sales growth.”

Clean Seas is the largest farmed kingfish producer outside of Japan, and the global leader in full cycle breeding and farming.

It raises fingerlings at its Arno Bay hatchery, about 120km north of Port Lincoln,  and then moves the juvenile fish to sea pens in Boston Bay, Arno Bay and further out to sea off Port Lincoln.

The company processes its fish at Royal Park in Adelaide and also has significant lease holdings at Whyalla and Wallaroo, which are currently untapped.

Clean Seas shares closed at $0.64 on Friday.

Meanwhile, Clean Seas shares were placed in a trading halt this morning pending a further announcement to the market on or before Wednesday.

Adelaide continues to be a consistent performer for SkyCity

SkyCity has reported a “consistent” performance across all of its Adelaide casino business activities with trading in March and April comparable to the December to February period.

The listed company said trading at its casinos in Adelaide, Auckland, Hamilton and Queenstown remained on track with trends disclosed when its first-half results were announced in mid-February.

Revenue from Adelaide was $89.5 million in the six months to December 31, a 15.8 per cent increase on the $77.4 million it generated in the same period the previous year.

This amount included $15.4 million in JobKeeper payments from the Australian Government on top of the $7.8 million it received from March 31 to June 30 last year. SkyCity was eligible for the payments until January 3 this year.

However, the New Zealand-based company did not publish full third-quarter figures or comparisons with last year on Friday because “COVID-19 related lockdowns limit comparability with the prior comparable period”.

SkyCity also announced a retail bond offer on Friday, which aims to raise NZ$125 million to be used to reduce the group’s drawings on its bank facilities. The six-year debt securities are unsecured, unsubordinated fixed-rate bonds and will mature in May 2027.

SkyCity opened its $330 million Adelaide expansion in the first week of December. The expansion includes new gaming spaces, bars, restaurants and the luxury 120-room EoS hotel.

Santos completes $500 million Top End sell-down

Oil and gas giant Santos has completed the sell-down of 25 per cent interests in Bayu-Undan and Darwin LNG to SK E&S.

Announced on Friday, the sell-down resulted in net funds to Santos of $240 million (US$186 million) at completion, being the sale price of $500 million (US$390 million) less the cashflows from the 25 per cent interests from the effective date of 1 October 2019 to completion.

It follows an announcement by the state’s largest listed company on March 30 that it had reached a final investment decision on its $4.7 billion Barossa project north-west of Darwin, which it says represents the biggest investment in Australia’s oil and gas sector since 2012.

SK E&S is also a partner in the Barossa project.

Santos Managing Director and Chief Executive Officer Kevin Gallagher said on Friday he was delighted to formally welcome Barossa joint venture partner SK E&S as a partner in Bayu-Undan and Darwin LNG.

“The sell-down to SK E&S is in-line with our strategy of disciplined growth while maintaining a strong balance sheet by managing equity levels in our growth projects consistent with disciplined capital management,” he said.

Santos and SK E&S have also signed a Memorandum of Understanding to jointly investigate opportunities for carbon-neutral LNG from Barossa, including collaboration relating to Santos’ Moomba CCS project, bilateral arrangements for carbon credits and potential future development of zero-emissions hydrogen.

Completion of the sell-down to SK E&S sees Santos’ interest in Bayu-Undan and Darwin LNG change to 43.4 per cent, and Santos remains operator of both assets. The remaining interests are held by SK E&S (25 per cent), INPEX (11.4 per cent), Eni (11 per cent), JERA (6.1 per cent) and Tokyo Gas (3.1 per cent).

Santos is also the operator of the Barossa project. First gas from Barossa to backfill Darwin LNG is expected in the first half of 2025.

Santos and JERA continue to progress the binding sale and purchase agreement for JERA to acquire a 12.5 per cent interest in Barossa.

IO Energy funding to drive interstate launch

Adelaide-based clean energy startup IO Energy has found backing from a host of investors, which the startup says will help it develop its smart technology ahead of an interstate launch.

The South Australian renewable company’s total seed funding last month closed at almost $650,000, including $100,000 from Sydney-based angel investors Adrian, Ben and Stephanie Waters.

The Waters family, which has previously invested primarily in cybersecurity and fintech, said its latest investment was “providing a positive social impact by moving the electricity market towards renewable energy”.

Private investment firm JAH Energy Investments – Jock Hamilton, Angus Twopeny and Henry Weir – also invested into IO Energy’s initial seed funding round for a minority equity stake in the startup. As part of the investment they will also act in an advisory capacity to the business.

JAH Energy Investments said the venture was the trio’s first investment as a private firm and it was actively looking for additional deals in the “alternative asset space”.

“We see greener and cheaper electricity as an inevitable shift so we were very happy to be part of this venture. We liked IO Energy’s timing with its entry into the Australian energy market. There has been a push in Australia and globally towards renewable energy,” it said.

“Leveraging off this, while also offering consumers an attractive cost-saving value proposition makes sense to us.

“The business model also presents an opportunity to expand into additional revenue streams to further underpin future growth, which is attractive.

“Ultimately, we are backing these guys in and we truly believe they are well placed to deliver, which is exciting.”

IO Energy said the seed funding would allow the company to further develop its smart technology and begin development interstate ahead of an interstate product launch.

The tech company launched its software, which controls the purchase and release of electricity in household grid-powered battery systems, in South Australia 12 months ago.

The product aims to maximise savings offered under time-of-use pricing for households that do not have solar panels by matching consumer usage profiles with grid energy pricing.

IO Energy software controls home batteries by informing the battery to charge when tariffs are at their lowest, allowing consumers to use stored energy in the evening peak periods when prices are at their highest.

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