Chilean fishing and salmon-farming firm Blumar cut its losses year over year in the third quarter of 2024, but still remained in the red.
In response to several straight periods of poor performance, the company has continued pursuing a process to transform its business operations.
During Q3 2024, Blumar’s total revenues amounted to USD 138 million (EUR 132 million), down 9 percent from the USD 152 million (EUR 146 million) the company earned in the third quarter of 2023. Its Q3 EBITDA before fair value adjustments came in at USD 10 million (EUR 9.6 million), falling 39 percent from USD 16.5 million (EUR 15.8 million) from the same quarter last year.
Its cost of sales, though, dropped 6 percent year over year to USD 119 million (EUR 114 million).
This helped drop its net losses to USD 555,000 (EUR 533,000) in the period – a 90 percent drop from losses of USD 5.5 million (EUR 52.8 million) in Q3 2023.
Broken down by sector, Blumar’s salmon-farming business turned a net profit of USD 1.4 million (EUR 1.3 million) on top-line revenues of USD 86.9 million (EUR 83.4 million), compared to a net loss of USD 15.3 million (EUR 14.7 million) on revenues of USD 74.1 million (EUR 71.1 million) during Q3 2023. Its industrial fishing business saw a USD 2 million (EUR 1.9 million) loss in Q3 2024 on revenues of USD 51.3 million (EUR 49.2 million), versus net profits of USD 9.7 million (EUR 9.3 million) on revenues of USD 78.4 million (EUR 75.2 million) in the same quarter of 2023.
Year to date, Atlantic salmon has represented 45 percent of total income, followed by fishmeal and fish oil at 24 percent, frozen horse mackerel at 22 percent, and whitefish at 7 percent.
In Q3, Blumar sold 12,138 metric tons (MT) whole fish equivalent (WFE) of Atlantic salmon – a 13 percent boost from the same quarter of 2023. Over the same period, average prices climbed 4 percent to USD 7.16 (EUR 6.87) per kilogram WFE, and ex-cage costs reached USD 4.70 (EUR 4.51) per kilogram WFE – down 7 percent due to lower feed and indirect production costs.
“This quarter, the [aquaculture] segment performed within expectations, which has suffered different contingencies. We are facing this scenario by maximizing efficiency to resume profitability in the segment and of the company in the shortest possible time,” Blumar CEO Gerardo Balbontín said in the Q3 results presentation. “We have good expectations for the future since we have had a good health performance and the markets have remained stable.”
Blumar said in April 2024, it had launched a project with the goal of increasing the efficiency and profitability of its salmon business, dubbing the project “Contracorriente,” or “Against the current.” The company has billed it as a major transformation that seeks to promote the adoption of a culture, mentality, and certain processes to drive continuous improvement and economic sustainability over time.
The three-year project is being led by a chief transformation officer and focuses on six areas – farming, processing, commercial, procurement, capital expenditures, and sales and operations planning – and aims to increase revenue, improve margins, and reduce costs, with an estimated impact on EBIT of USD 0.50 (EUR 0.48) per kilogram WFE, Blumar said.
Contracorriente will also offer multiple training sessions for knowledge and expertise exchange between technical and business support areas in order to strengthen informational flow and elicit better decision-making, along with periodic, structured sessions with the aim of defining new opportunities to generate value.
“Transformation goes far beyond a group of initiatives; we are changing the way we work and create value for Blumar,” the company said.
The company said it expects to realize most of the projected impact in the next year.
Blumar previously reported that an algae bloom and a fire at one of its processing plants negatively affected results during the first half of 2024. H1 net profits plummeted 84 percent to USD 5.5 million (EUR 5.3 million). Its fishing segment turned a USD 33.9 million (EUR 32.5 million) profit in the period, but aquaculture suffered a net loss of USD 28.4 million (EUR 27.3 million), which included a USD 11.5 million (EUR 11 million) provision for impairment losses on assets at its Entrevientos plant that was completely consumed by a fire in February
Blumar jointly owns the plant with fellow salmon-farming firm MultiX.
