Rare Foods Australia has secured shareholder approval to voluntarily delist from the ASX, while implementing significant cost reductions and achieving record growth in its Subsea Estate wine brand.
- Voluntary ASX delisting approved with 99.3% shareholder support
- Annual cost savings of $3.2 million from staff redundancies and supplier reviews
- Harvest of 15 tonnes of ranched abalone in line with forecasts for Q3
- Subsea Estate Cellar Door sales surged 280% to $163K in the quarter
- Application submitted for 5ha Subsea Estate ocean lease in Augusta Port
Strategic Delisting Marks New Chapter
Rare Foods Australia Limited (ASX: RFA) has taken a decisive step by voluntarily delisting from the ASX, a move overwhelmingly supported by 99.3% of shareholders at the recent general meeting. The board views this as a strategic pivot to reduce the substantial costs and administrative burdens associated with being a listed company, estimated at $735,000 annually, and to focus more intently on executing its growth plans away from the public spotlight.
While delisting often raises concerns about liquidity and transparency, Rare Foods has committed to maintaining rigorous governance and continuous disclosure as an unlisted public company. The board anticipates that operating without the constraints of public listing will allow more agile decision-making and protect sensitive strategic information from competitors.
Cost Reductions and Operational Efficiency
In tandem with the delisting, Rare Foods has implemented significant cost-cutting measures, including staff redundancies and supplier contract reviews, projected to save approximately $3.2 million annually. These actions are part of a broader strategy to steer the company toward cashflow positivity, anticipated in FY26.
The company also paused juvenile abalone deployments for 2025 due to unsustainable supply arrangements, which further reduces operational expenses. Despite these changes, the company met its harvest target of 15 tonnes for the quarter and remains on track for a 60-tonne harvest in FY25.
Robust Sales and Brand Growth
Sales of premium abalone products totaled 23.3 tonnes in the quarter, generating $845,000 in revenue, with MSC certified wild caught Greenlip abalone contributing $616,000. The company is actively expanding its market reach into China, Japan, and Vietnam, leveraging new direct flight routes to support live abalone demand.
Meanwhile, the Subsea Estate brand continues to gain traction. The rebranded Subsea Estate Cellar Door achieved record quarterly sales of $163,000, a remarkable 280% increase year-on-year. This venue offers a unique subsea wine and abalone tasting experience that has resonated strongly with local tourism and retail customers.
Subsea Estate’s ocean cellared wines, produced in collaboration with Winereef International in Margaret River, sold 1,231 bottles this quarter. The company has applied for a dedicated 5-hectare ocean lease in Augusta Port to support expansion of this innovative subsea winemaking initiative, with final approval expected in Q4.
Progress on Aquaculture Precinct and Leadership
Rare Foods is advancing the Esperance Aquaculture Precinct project, preparing federal funding applications for infrastructure development and promoting the precinct to attract partners. Consultant reports assessing viability and economic opportunities are due in Q4, setting the stage for national and international engagement.
Leadership changes include the appointment of Toni Angelevski as CFO/CoSec and Matt Lewis as Commercial Services Manager, signaling a strengthened management team to drive the company’s next phase.
Financial Position and Outlook
Cashflow from operations remained negative at $1.2 million for the quarter, impacted by one-off redundancy costs. However, the company expects these cost savings to materialize fully in FY26, projecting a return to positive cashflow. The company is also pursuing refinancing and additional R&D tax incentives to bolster its working capital position.
Bottom Line?
Rare Foods’ strategic delisting and cost discipline set the stage for a leaner, growth-focused future, but investors will watch closely for cashflow turnaround and project milestones.
Questions in the middle?
- How will delisting affect liquidity and shareholder engagement long term?
- What is the timeline and likelihood of approval for the Subsea Estate ocean lease?
- Can Rare Foods successfully expand its market presence in Asia amid soft international abalone demand?