The automation was providing extra dollars in meat yields for sheep and beef processors, including $4 to $5 for every lamb carcase, Scott chairman Stuart McLauchlan said.
The yield gain was greater than the savings in labour costs, a key reason for the technology changes.
After a 256% increase in meat processing sales in the 2016 year, revenues in the latest year to August 31 were up just 2% to $39.58m.
In their report for the year, directors said the division had consolidated while the group readied to expand for the next phase of growth.
A significant expansion of the manufacturing plant in Dunedin was based on the meat technology, McLauchlan said. He hoped it would be completed in the next year.
Scott Tech was active in lamb processing automation through the Robotic Technologies joint-venture with Silver Fern Farms and in beef automation in Australia where it worked closely with its own majority shareholder, the JBS group.
The company was also developing pork and poultry automation for customers in the United States and Europe.
Scott Tech’s managing director Chris Hopkins now spent considerable time in Sydney and had been doing a round of presentations to investors in Australia, organised by Wellington-based advisory group Woodward Partners.
Since JBS came aboard about the middle of last year with the capital injection that gave it a 50.1% shareholding, Scott Tech’s market capitalisation had risen to the point where the company was attracting interest from institutional investors, McLauchlan said.
At a share price of $3.55 the company was worth about $265m on the NZX; the gain for shareholders this year alone was about 67%, including dividends.
Scott Tech reported a successful first full-year with JBS as the main shareholder with a 26% lift in after-tax profit to $10.26m, up from $8.13m.
Operating cashflows were lower at $13.4m, from $16.1m but the balance sheet was very strong. Shareholders’ equity ratio was above 70% and there were no borrowings. As well, there was just over $26m in cash and the company was looking for acquisitions.
They should fit in with the existing core businesses and the geographical base, McLauchlan said.
In the latest year, the Appliances division lifted revenues to $26.3m from $20.1m, helped by the acquisition of a German competitor business last year.
The Mining technology business improved to $26.4m from $22.3m, and the big improver was the other industrial automation (including robotics) division, which lifted to $38.5m from $27.29m. That business had a significant US presence.
The directors expected further strong growth as US and Australian customers looked for solutions to their labour concerns.
Customers were looking for ways to increase productivity, improve quality or reduce costs and in many markets there was a shortage of suitable workers so automation and robotics were high on the agenda.
Meat processing revenues rose from the 2016 year’s $38.87m.
One of Scott Tech’s major acquisition successes was the Australia-based Bladestop bandsaw safety technology business last year, which it was incorporating into the meat processing industry along with its own auto and robotics technology and putting into the US.
The technology allowed instantaneous stopping of a saw blade as soon as a foreign object was detected, making it a valuable health and safety tool.
“It means a slight nick at the most instead of losing fingers,” McLauchlan said.
Scott Tech was now looking to put the meat processing units into lighter customer operations such as butcher shops.
But first it had to increase production capacity to meet existing demand.
In major meat processing plants the technology had led to securing more meat off the bone; less meat down the waste belt; better cut optimisation and better information from the whole process.
