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Briefcase: Business snippets from around SA

Business

In this week’s briefcase, the South Australian Jockey Club turns around its fortunes with a $7.6 million net profit, Adelaide clinical trials company CMAX wins a national export award and east coast furniture company Lounge Lovers establishes its first SA warehouse.

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SAJC races to $7.6 million profit

Booming investment returns and significant JobKeeper payments have helped the South Australian Jockey Club to a $7.6 million net profit for 2020-21, a major turnaround from its $3.8 million net loss the previous year.

The club, which runs Adelaide’s Morphettville Racecourse, last week announced a 2020-21 operating profit of $414,000.

However, the operating figure excludes the $1.6 million in JobKeeper subsidies the SAJC received in the financial year and the $8.8 million returned by its investment funds.

The club’s investment cash holding is now at $52 million ahead of a planned $500 million redevelopment of the precinct due to begin next year.

The result was also achieved despite income from operating activities falling $2.8 million from the previous year following a reduction in non race day events to 68 from 118 in 2019-20.

Membership was up 55 per cent to 2207 but overall attendance was down by 10,000 people to 57,419 across 47 meetings for the year.

This was also well down on the 100,000 people who attended race days at Morphettville across 56 meetings in 2018-19.

Despite the downturn in attendances, total betting turnover was up to $38 million, largely driven by a 50 per cent spike in off-course turnover to $34 million.

SAJC CEO Grant Mayer said the result was an indication of the innovation and agility the club had built into its operations amid the COVID-19 pandemic.

“This is a very pleasing result given the challenges we have faced over the past 12 months,” he said.

National export award for CMAX

South Australian-based clinical trial and research company CMAX Clinical Research has won the Professional Services Award at the 59th Australian Export Awards on Thursday night.

Despite having a custom-built facility in Adelaide, CMAX export sales almost doubled in the 2020-21 financial year due to pandemic-related industry disruptions.

CMAX Chief Business Development Officer Zoe Harrison said for more than 25 years the company had built relationships with medical experts and pharmacology specialists around the world, attracting interest from global biopharmaceutical and device companies in USA and Asia, where regulatory approval processes are slower.

“We now employ 275 staff, and we are a phenomenal team that is working incredibly hard to showcase Australia and South Australia.

“I am so proud of our team who have all displayed incredible resilience as COVID increased demand, we were able to rise to the challenge.”

Harrison said the changing nature of needs during the pandemic had seen the establishment of new markets for the firm.

“Traditionally, most of our export relationships were with the United States, however export sales almost doubled last year as we have picked up more work in Europe and Asia.”

CMAX was the only winner among 10 South Australian companies nominated as finalists in the national awards following success at the SA Export Awards in September.

Other SA finalists included Bec Hardy Wines, Mighty Kingdom Games, Lightforce Australia and REDARC Electronics.

SA warehouse boost for furniture company

Lounge Lovers has opened an Adelaide warehouse.

Furniture business Lounge Lovers has opened a warehouse and distribution centre in South Australia after a successful first year of sales out of its Adelaide showroom.

The national business with showrooms in Sydney, Brisbane and Melbourne opened its first Adelaide store in Morphett Street in the city more than a year ago and says it achieved almost 50 per cent growth in the September quarter this year compared to 2020.

It says the opening of the warehouse in Devon Park will allow next-day delivery for in-stock items.

General Manager of Support Services and Logistics at Lounge Lovers James Croft said the business had invested more than $2m to set up the distribution centre and employed a local delivery team to create a streamlined experience for South Australian shoppers.

“We are thrilled to expand the Lounge Lovers warehouse and logistics team to South Australia,” he said.

“By opening a warehouse here in Adelaide, we will have the ability to service our South Australian customers better by delivering their furniture sooner.”

Lounge Lovers said the SA expansion would help support its continued expansion following national growth of 167 per cent across the business in the 2020-21 financial year.

BioCina opens Thebarton vaccine site

A new facility capable of making advanced mRNA vaccines opened in Adelaide last week, as biotech firms await a decision on local COVID-19 vaccine manufacturing from the federal government.

Biologics contract development and manufacturing firm BioCina – a subsidiary of US investment firm Bridgewest Group – on Thursday officially took over a 4600sq m manufacturing facility in Thebarton from American pharmaceutical giant Pfizer.

BioCina says the facility will offer “full clinical supply services” to biopharma customers and “full production of mRNA vaccines from early process development through to commercial product manufacture”.

It comes after the firm lodged a bid with the federal government in July to manufacture mRNA COVID-19 vaccines – the type patented by Pfizer and Moderna – in South Australia.

The federal government is still yet to make a decision on awarding grant funding for onshore manufacturing, with Victorian biotechnology giant CSL also in the mix.

BioCina has previously stated they could begin manufacturing mRNA vaccines at the Thebarton site within 12 months of receiving funds from the federal government.

“We have been working hard to make sure that we hit the ground running after transitioning this facility and operations from Pfizer,” BioCina CEO Ian Wisenberg said today.

“The team has been working flat out to ensure that we stand up all the systems and comply with all the regulatory requirements to be fully operational.

“BioCina is making a significant investment in and strategically focusing on mRNA process development and manufacturing for vaccines and therapeutics to support solutions using this mRNA platform for our clients.”

KI timber company to repay pellet mill grant

Fire-damaged logs on Kangaroo Island await export.

Former Kangaroo Island timber company Kiland will repay a $2.6 million grant to the Australian Government after moving out of the industry and into agriculture.

The company, known as Kangaroo Island Plantation Timber until last month, announced in December 2020 it had secured a $5 million Forestry Development Fund grant to support the development of a biomass pellet mill on Kangaroo Island.

The company has so far received $2.6 million of the funding.

Kiland announced plans in August to revert 18,6967 hectares of its land to agriculture – a decision that involves knocking over and burning about 14,500 hectares of pine and blue gum plantations.

The decision came just days after an announcement by State Planning Minister Vickie Chapman that the government had rejected KIPT’s proposal to develop a $40 million timber port at Smith Bay on the island’s north coast.

The publicly listed company last week reported to the ASX that the Australian Government has informed it that its application no longer aligns with the alignment of the grant program and the funds received to date are to be repaid.

Kiland said in the statement it planned to repay the $2.6 million in full.

The company owns about 14,500 hectares of plantations, about 80 per cent hardwood (blue gum) and 20 per cent softwood pine.

But about 95 per cent of it was damaged in the Kangaroo Island fires that began on December 20, 2019 and burnt 210,000ha – almost half of the island – before being declared contained on January 21, 2020.

The company has received more than $60 million in insurance payout following the fires and has since been in a race against time to salvage the timber and ship it off the island before it rots.

Kiland is yet to decide if it will manage the converted agricultural land itself, lease it out or sell it off.

Shaw + Smith owners snap up a slice of the Vale

The founders of leading Adelaide Hills winery Shaw + Smith have bought a vineyard in Blewitt Springs to increase their focus on iconic McLaren Vale varieties.

Together with joint CEOs Adam Wadewitz and David LeMire, Shaw + Smith founders Martin Shaw and Michael Hill Smith will produce three single-vineyard wines – Grenache, Shiraz and Chenin Blanc – under the MMAD Vineyard label, which is named after Martin, Michael, Adam and David.

The McLaren Vale region is famous for its Grenache and Shiraz varieties and those vines on the 18-hectare vineyard are more than 80 years old while the Chenin Blanc was planted in 1964.

“This is rare earth, and the old vines are a precious resource and part of our viticultural history that we are grateful to have the chance to work with,” LeMire said.

The 2021 MMAD Vineyard wines will be released in the second half of 2022.

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