Blumar records solid fishing, lackluster salmon-farming performance in Q2 2023
Blumar’s Q2 2023 net profits fell over 25 percent, as its fishing operations performed solidly but not enough to make up for the company’s lackluster performance in its salmon-farming segment.
The Santiago, Chile-based seafood firm’s revenues increased 10.5 percent year over year to USD 206.8 million (EUR 193.1 million) in Q2 2023, compared to the USD 187 million (EUR 175 million) the firm brought in during Q2 2022. Its earnings before interest, taxes, depreciation, and amortization (EBITDA) slipped 0.82 percent to USD 51.4 million (EUR 48 million) compared to USD 51.8 million (EUR 48.3 million) in Q2 2022, while net profits fell 25.4 percent to USD 19.9 million (EUR 18.6 million) – a sizable slide from the USD 26.6 million (EUR 24.8 million) the company earned in the same quarter a year ago.
For the first six months of the year, salmon comprised the majority of Blumar’s revenue, bringing in USD 204.4 million (EUR 190.8 million), representing 53 percent of the company’s total. Fishmeal and fish oil followed at USD 91.4 million (EUR 85.3 million), taking up 23 percent of revenue. Next came frozen horse mackerel, bringing in USD 64.3 million (EUR 60 million) and representing 17 percent of the total. Finally, whitefish and other products comprised the remaining 7 percent at USD 29.1 million (EUR 27.2 million).
However, Blumar’s salmon-farming segment’s revenue slipped 1.3 percent to USD 90.4 million (EUR 84.4 million) during the quarter when compared to the second quarter of 2022. The segment’s EBITDA plunged 71.7 percent year over year to USD 4.2 million (EUR 3.9 million), and its net profit fell USD 7.2 million (EUR 6.7 million) into the red, compared USD 6.5 million (EUR 6.1 million) in the second quarter of 2022.
To date this year, 69 percent of Blumar’s salmon has gone to the United States, 12 percent to Latin American countries, 11 percent to Asia, 6 percent domestically, and 2 percent to Europe.
Blumar noted that on an international level, sales prices were down for salmon. A sustained rise in costs, principally due to the increased cost of feed and raw materials as well as other increased costs due to inflation, exacerbated its financial predicament.
During the quarter, the company produced 13,693 metric tons (MT) of fishmeal, down 19 percent compared to Q2 2022. It also produced 5,105 MT of fish oil, up 14 percent year over year, and 50,145 MT of frozen horse mackerel, up 34 percent year over year.
Blumar sold 18,564 MT of fishmeal in Q2, slipping 1 percent year over year, but the average price received increased 3 percent to USD 1,896 (EUR 1,770) per MT during the quarter, bringing total sales up 1 percent to USD 35.2 million (EUR 32.9 million). The company attributed the Q2 price increases due to uncertainty brought on by the effects of El Niño that resulted in a high presence of juvenile anchovies off the waters of Chile. Half of the company’s fishmeal went to its primary market of China, and a quarter was sold to South Korea.
Making special note of the prematurely closed anchovy fishing season in Peru, the company’s Q2 2023 report said that Chile had also seen one of its worst fishing seasons in recent history, with volumes down 9 percent from a year prior.
Blumar’s fish oil sales were down 12 percent in volume terms to 7,439 MT, but the average price received, similar to fishmeal, surged 75 percent to USD 4,576 (EUR 4,272) per MT, bringing total sales to USD 34 million (EUR 31.7 million) – up 54 percent year over year. Europe bought 77 percent of this product, and Blumar said prices continued on an upward trend because of low production in Peru and northern Chile, together with lower fishing volumes.
Frozen horse mackerel sales were up 31 percent in volume, amounting to 37,407 MT but prices for this product were down 9 percent, dropping to USD 916 (EUR 855) per MT and bringing in total sales of USD 34.3 million (EUR 32 million). Total sales were up 19 percent when compared to Q2 2022. Blumar said Africa was the main destination for this product, representing 88 percent of total exports, with Nigeria being Blumar’s main customer in this segment.
At the beginning of the year, the company launched a rebranding campaign and announced its new purpose: “We nurture people embracing the ocean.” Defined after a year of work, Blumar said the purpose aimed to inspire the company’s entire value chain for the production and sale of responsible seafood.
Founded 11 years ago upon the merger of the companies El Golfo and Itata, Blumar has over 2,100 employees.
Photo courtesy of Blumar