Canada-based food company Premium Brands Holdings Corporation continued its streak of record earnings and sales in Q2 2024.
The company had revenue of CAD 1.7 billion (USD 1.23 billion, EUR 1.13 billion) in Q2 2024, up 4.4 percent, or CAD 71.8 million (USD 52.3 million, EUR 47.9 million), from the same period of 2023. Alongside increased revenue was increased earnings, with the company posting adjusted EBITDA of CAD 164.6 million (USD 119.8 million, EUR 109.8 million), an 8 percent, or CAD 12.2 million (USD 8.8 million, EUR 8.1 million) percent, increase.
“We are pleased to report another quarter of record sales and adjusted EBITDA as we make steady progress toward achieving our short- and long-term strategic objectives,” Premium Brands President and CEO George Paleologou said in a release.
Paleologou said the company’s Specialty Foods Group continues to be the major driver of the company’s continued growth, in part thanks to a string of investments that the company has made in new production capacity.
“Most of our Specialty Foods Group’s recent success has been in the U.S. where its protein, sandwich, and bakery businesses have built unique and resilient foundations for growth by finding white space opportunities,” he said.
Specialty Foods’ revenue increased by CAD 66.8 million (USD 48.6 million, EUR 44.5 million) in the quarter, largely thanks to organic volume growth, the company said. Meanwhile, the company’s Premium Food Distribution revenue increased by just CAD 5 million (USD 3.6 million, EUR 3.3 million), with CAD 8.2 million (USD 5.9 million, EUR 5.4 million) in price inflation within its lobster products helping reach that number.
However, sales volumes in the Premium Food Distribution segment dropped due to weaker consumer spending in the foodservice channel, reduced live lobster exports to China, and lower premium beef and seafood sales.
One of Premium Brands’ main seafood-related subsidiaries, Clearwater Seafoods, continued to post losses – even as it achieved higher revenue.
In Q2 2024, Clearwater also had revenue of CAD 146.3 million (USD 106.5 million, EUR 97.6 million), up from CAD 137.9 million (USD 100.4 million, EUR 91.9 million) in Q2 2023. Despite that, it posted a net loss of CAD 17.4 million (USD 12.6 million, EUR 11.6 million), compared to the net loss of CAD 12.3 million (USD 8.9 million, EUR 8.2 million) in Q2 2023.
Premium Brands attributed the higher revenue at Clearwater to strong turbot catch rates thanks to a new turbot vessel that came online, improved Argentine scallop harvesting conditions, and the recovery of snow crab sales “driven by normalization of industry inventory levels and a strong Canadian spring fishery.”
However, those positive factors were offset by lower Canadian scallop sales and reduced harvesting of frozen-at-sea shrimp caused by weather-related issues.
In an investor presentation, Premium Brands said that it continues to look for acquisition opportunities, and the company is currently in negotiations with a seafood company that has annual sales of CAD 325 million (USD 236 million, EUR 216 million) and is also in discussions with five other seafood companies with combined sales of CAD 983 million (USD 715 million, EUR 655 million).
“Although we did not close any acquisitions during the quarter, we're pleased to report that we're in the advanced stages of due diligence on a number of deals, and we hope to close a few in the near future,” Paleologou said.
