Yes they have tried to right size the business a number of times...

Yes they have tried to right size the business a number of times based on minimum production vols. This was stated as achieving consistent positive cashflows and profitability. However this has proven to be incorrect for a number of reasons, evidenced by the latest annoucement. i.e they are reducing production as they no longer believe growth in biomass/production will get them there without further substantial capital/working capital expenditure. Its now apparent that the economies of scale achieved at a higher biomas do not outweigh higher costs. However this should have been blindly obvious and speaks to very poor modelling and risk management. You have to remember that this company has tried a number of routes to profitability and all have failed..tuna, prawns, kingfish and all the permutations inbetween in terms of biomass weight, retail vs wholesale etc etc. Its almost like it is an experiment for mgmt.

My comment around vertical integration related to the fact that the company has no money to do it. But if they did they would have been able to invest in an upstream fish feed supplier so as to reduce input costs. Or invest in technologies to bring fwd non-reliance on certain fish food ingredients. Recapitalising may achieve this but the point is that this latest CR only gets us so far. Its not clear what it achieves as its not explicitly stated. Due to this I can only assume its being done to keep the lights on until the business is "right sized". Hence they need a lot more money over the next few years to be profitable and grow those profits, thus the need to recapitalise (which in itself will be painful). If they need $30M then state that and recapitalise for it; sell plant/equipment, outsource operational activities, outsourcing business functions, leaseback of properties, debt refinace or a mix of hybrid debt via capital mkts. As I said this will be painful but without it the cycle will just rinse and repeat.