Aquaculture feed manufacturer BioMar reported record revenue and earnings before interest, taxes, depreciation, and amortization (EBITDA) in FY 2023, surpassing its own guidance to the market.
The company achieved revenues of DKK 17.9 billion (USD 2.6 billion, EUR 2.4 billion) in FY 2023, up slightly from the DKK 17.8 million (USD 2.5 billion, EUR 2.3 billion) it posted last year. Over the same period, the company posted an EBITDA of DKK 1.25 billion (USD 181 million, EUR 167 million), up from DKK 1.01 billion (USD 146 million, EUR 135 million) and marking an increase of 26 percent across consolidated companies and joint ventures.
The higher revenue and earnings came even as the company saw its sales volumes decrease. In total, the company sold 1.43 million metric tons (MT) of feed, compared to 1.45 million MT in FY 2022. Of that, based on results posted by BioMar parent company Schouw & Co., 972,000 MT comprised salmon feed, compared to 1 million MT in 2022, and 466,000 MT was made up of shrimp feed, up from 441 MT in FY 2022.
“I am extremely satisfied with our business performance for 2023,” BioMar CEO Carlos Diaz said. “We have continued to optimize our product portfolio and product concepts, being proactive to the development in the markets. At the same time, we have improved our commercial performance both up- and downstream.”
In Q4 2023, the company posted revenues of DKK 4.2 billion (USD 610 million, EUR 563 million), down slightly from the DKK 4.9 billion (USD 712 million, EUR 657 million) posted in Q4 2022. BioMar’s EBITDA in Q4, however, increased to DKK 397 million (USD 57 million, EUR 53 million), up from DKK 294 million (USD 42 million, EUR 39 million).
The Q4 results also came on the back of lower year-over-year volumes. The company sold 345,000 MT of feed across all divisions in Q4 2023, compared to 372,000 MT in Q4 2022. That drop was largely attributable to the salmon feed division, which dropped to 229,000 MT in Q4 2023, down from 265,000 MT during the same period of 2022.
According to BioMar’s report, lower volumes in salmon were driven by sales in Norway and Chile.
“The lower volumes in Norway reflected reduced contract positions because BioMar has prioritized long-term relationships with fish farmers but were also due to biological factors and an earlier harvest of fish stock biomass,” the company said.
The company’s operations in Asia, however, have struggled slightly. The company’s shrimp operations – established when the company bought into Vietnamese seafood corporation Viet-Uc – have faced disease outbreaks and low settlement prices, the company said.
“In combination with the competition it is exposed to from highly efficient operations in Ecuador, this has severely delayed the developments expected after BioMar’s acquisition of the Vietnamese shrimp-farming business Viet-Uc,” BioMar said.
The company has now written off the carrying amount of goodwill by DKK 36 million (USD 5.2 million, EUR 4.8 million) relating to the company, which BioMar said is a result of the original deal when it acquired the company at a price based on expected future earnings. Its division in Vietnam has also been impacted by costs incurred for “market build-up purposes,” BioMar said.
“BioMar still has positive expectations for the shrimp feed market in Vietnam, but these have been lowered from the original forecast,” the company said.
Looking forward, BioMar is still bullish on the aquaculture feed market due to the growing demand for aquaculture globally. The company said it is “well-positioned” to capitalize on the growth, even as in the short term, demand for feed will be affected by market conditions and the volatility of the raw material prices.
“We have prioritized [building] long-term product collaborations with our core customers, rather than chasing volumes,” Diaz said. “This means that our volumes have stayed stable compared to 2022. We are building a healthy business, which can further propel the development of our financial performance as well as our sustainability ambitions.”
