AKVA Group sees Q1 revenue drop amid slow land-based market

An aerial view of AKVA Group's Nordic Aqua Partners facility in China
AKVA Group's Nordic Aqua Partners project in China had a successful first harvest in Q1 2024 | Photo courtesy of AKVA Group
6 Min

Klepp, Norway-headquartered aquaculture technology company AKVA Group saw its revenues for the first quarter of 2024 fall 10 percent year over year to NOK 784 million (USD 71.8 million, EUR 66.8 million), with CEO Knut Nesse attributing the drop to “very low activity levels” in its land-based technology (LBT) business.

Delivering AKVA’s Q1 2024 results on 3 May, Nesse said the land-based market is slow right now and confirmed AKVA is not expecting to sign any significant recirculating aquaculture system (RAS) contracts during the entire first half of the year.

The country’s post-smolt market is also challenging to navigate due to Norway’s aquaculture resource tax in place, Nesse said, which has producers reluctant to place any large orders until they know its full implications. However, Nesse said he anticipates the issue should abate a bit in the closing six months of 2024.

Additionally, supply of Atlantic salmon is under pressure due to continually challenging biological and fish health conditions, though Nesse said he hopes this market capitalizes on its large growth capability in the next five to 10 years.

“The big question is how and where that’s going to happen,” Nesse said.

Amid the challenging environment, the first quarter of the year started slow in terms of orders for AKVA but closed strong, Nesse said.

“That means we have a pretty strong momentum going into the second quarter,” he said.

The group received orders totaling NOK 917 million (USD 84 million, EUR 78.2 million) in the period, representing a year-over-year decrease of NOK 253 million (USD 23.2 million, EUR 21.6 million). The drop was aided by a strong order intake of NOK 800 million (USD 73.2 million, EUR 68.2 million) in its sea-based technology (SBT) segment, including the award of three new barges for the Nordic market with a total contract value of approximately NOK 160 million (USD 14.6 million, EUR 13.6 million).

Nesse said that no barges were ordered in 2023.

AKVA also recently inked a contract with Icelandic aquaculture company Laxey to implement the technology across the first of six grow-out modules planned for a site on Iceland’s Westman Islands, though the deal was finalized in Q2.

This delivery includes the design and installation of oxygenation and degassing systems and electrical systems, as well as project management and advisory services. Laxey’s long-term target is 27,000 metric tons (MT) of production capacity, including a post-smolt strategy serving sea-based farmers in the region.

“We also see some traction with post-smolt internationally – both in Canada and Chile  – and we expect to see real development in China with regards to on-growing in the months to come,” Nesse said.

AKVA will also look to

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