Moscow, Russia-based Russian Aquaculture (RA) has announced its output and profits skyrocketed in the first six months of 2019.
The company is reaping the benefits of investments it gained through a secondary public offering in 2017, allowing it to build a vertically integrated business structure with control of the entire production circle and supply chain, it said in a press release.
In the first half 2019, the company’s sales by volume reached 9,600 metric tons (MT), compared to 800 MT in the corresponding period of 2018.
Income increased to RUB 4.8 billion (USD 75.17 million, EUR 68.40 million) from RUB 300 million (USD 4.7 million, EUR 4.27 million) in the same period in 2018. The company's EBITDA went up by 44 percent to 2.1 billion rubles (USD 32.88 million, EUR 30 million).
Sales were driven by the recovery of the Russian salmonids market. Another factor that contributed to the increase is annual stocking conducted in 2017, 2018 and 2019. Thanks to the stocking, Russian Aquaculture now has three generations of fish in its cages, including juveniles from 2018 and species of marketable weight from the previous years.
Other steps taken by the company included a transfer to full control over production, including supply of feed, and establishing its own sales system which reflected the company’s desire to become an entirely integrated business from stocking to shelf.
Russian Aquaculture holds a 17 to 20 percent share of Russia’s salmonid market, according the company’s estimates. The company “uses its competitive advantages in terms of quality and freshness to outperform foreign producers,” RA CEO Ilya Sosnov said.
In 2019, RA is expected to harvest totally 18,000 to 20,000 MT with a further increase to 30,000 to 35,000 MT per year by 2025. Right now, the company owns the rights to use 34 sites for farming salmon and rainbow trout, which could yield up to 50,000 MT of salmonids a year.
The Russian market of chilled salmonids is on the rise, said Sosnov, so the company expects the growth in demand to continue.
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