A Business Point of View

High Liner Celebrates its 125^th Anniversary

There is a good chance growing up that you have eaten fish sticks from High Liner. High Liner has evolved significantly from its original product offering to the market and is now a $1 billion US in annual sales company.

Recently we had Paul Jewer, the CEO of High Liner Foods, on the Insights Podcast. The company had just celebrated its 125^th anniversary and its head office is based in Lunenburg, Nova Scotia. For any company to reach such a milestone is significant, let alone a company that operates in the fishing industry, a sector that is renown for its volatility. Indeed, High Liner (previously known as National Sea Products) made a significant strategic decision to pivot away from the harvesting of fish to concentrate on the processing of fish following the cod moratorium of the 1990s that devasted the fishing industry in Atlantic Canada. At the time of the moratorium, High Liner operated its own fleet of fishing vessels. It was a fortuitous decision that led the company to become North America’s largest processor of seafood product. Its nine vessel fishing fleet and quota was eventually sold to Clearwater in 2003

The Past

The history of Highliner can be traced back to 1899 to W.C.Smith & Company in Lunenburg, which was a purveyor of goods to the fishing industry. That company became Lunenburg Sea Products in the 1920s and then National Sea Products in 1945 before the company was re-branded as High Liner Foods in 1999. It is worth noting that the High Liner brand of products was created in 1926.

As Jewer told us in the podcast with him, “One of the things we’re very proud of as a company is our resilience and ability to change when circumstances and markets require it”. There is no better example of the company’s resilience than when the company pivoted away from being a major harvester of fish to focus exclusively on being a processor of seafood following the collapse of the cod fishery in the 1990s.

As Jewer pointed out, the biggest advantage of becoming a seller, marketer and distributor of value-added seafood across North America is the flexibility it provides the company to meet the needs of customers and consumers rather than simply selling what the company caught.

The Present

Today High Liner has three processing facilities, the largest is in Lunenburg where the company is the town’s major employer with nearly 300 employees. Overall, the company has 1,200 employees including several hundred at its two US based processing facilities, one in Portsmouth, New Hampshire and one in Newport News, Virginia. The company now sources twenty species of fish internationally, including haddock, cod, pollock and salmon. The company sources its fish both from the wild fishery and aquaculture. The company’s major brands include High Liner in Canada and Sea Cuisine and Fisher Boy brands in the US. A big part of the company’s revenue is generated from no name products provided to companies like McDonald’s. If you have had “Filet-of-Fish” from McDonald’s, you have eaten High Liner products. The food services sector represents about 70 percent of the company’s revenues and includes contract feeding for institutional clients through major food service companies (like Aramark and Sodexo) for long-term care facilities, hospitals and universities.

One of the interesting effects of moving away from harvesting is that the company created more employment on a year-round basis reducing some of the seasonality that is most associated with the fishing industry. The company has a focus on automation in its continued search for production efficiencies.

The company’s growth has been in part driven through acquisition, including the purchase of Fisheries Products International (FPI) in 2007 and Icelandic Group in 2011. The company continues to pursue acquisition opportunities to grow the company.

High Liner Foods is a publicly traded company on the TSX (symbol HLF), but 38 percent of its stock is owned by the Hennigar family. The Hennigars are part of the Roy Joudrey family tree. Joudrey was kincluded High Liner Foods, Minas Basin Pulp & Paper and CKF Inc. at the time the Joudrey empire was split up in 2011.The Hennigar family kept the High Liner business, while the Bishop family kept Minas Basin Pulp & Paper and CKF Inc.

The Future

The company is heavily focused on the sustainability of the seafood it purchases and only works with suppliers who have sustainability certification for wild caught species or farmed fish it sources. The company is also focused on developing new products for the market and has its own research and development department for that purpose. The company is actively involved in expanding the traceability of its products for safety purposes.

In terms of opportunity, Jewer believes there is plenty of growth potential in the market. North Americans generally consume far less seafood than many other parts of the world and seafood is better for health relative to meat protein.

The continuing success of High Liner Foods underscores both the importance and opportunity of natural resource-based companies in our region. There are significant opportunities to further develop our fishing industry across Atlantic Canada, especially through environmentally responsible fish farming both on-land and in the ocean. We just need to resolve the regulatory challenges to take advantage of these opportunities.