The 2020 financial results of Chile’s leading protein producer, Agrosuper, were severely hampered by the performance of its aquaculture arm.
Agrosuper subsidiary AquaChile, Chile’s largest salmon farmer and the second-largest in the world after Mowi, saw net losses of CLP 156 billion (USD 214 million, EUR 181 million) last year, compared to profits of CLP 50.2 billion (USD 69 million, EUR 58 million) in 2019. Revenues from aquaculture were down 6 percent to CLP 826 billion (USD 1.13 billion, 960 million), while sales costs jumped 21 percent to CLP 814 billion (USD 1.1 billion, EUR 946 million).
Overall, for the full year 2020, Agrosuper recorded revenue of CLP 2.6 trillion (USD 3.6 billion, EUR 3 billion), 7.1 percent higher than in full-year 2019. Consolidated earnings before interest, taxes, debt, and amortization (EBITDA), pre-fair value, was CLP 307 billion (USD 422 million, EUR 363 million), 30.3 percent lower than that registered in 2019. That resulted in a consolidated EBITDA margin, without fair value, of 11.8 percent, compared to 18.2 percent in the previous year. Net profits plummeted 74 percent to CLP 48.2 billion (USD 66 million, EUR 56 million).
Agrosuper said it had seen “a mixed performance” in 2020 for its meat and aquaculture segments, with the former showing a positive result, mainly driven by a high demand for products in Asia. In turn, the company attributed the negative result in its aquaculture segment mainly to the decrease in international salmon prices stemming from lower demand brought on by the COVID-19 pandemic, as well as higher production and logistics costs.
The EBITDA margin of the meat segment reached 22.8 percent in 2020, which compares positively with the 18.9 percent of the same period of 2019. On the other hand, the EBITDA margin (pre-fair value) of the aquaculture segment reached negative 10.9 percent, in contrast to a gain of 16.7 percent achieved the year before.
“We are very attentive in following the evolution of the pandemic in Chile and the world, in order to adapt to different scenarios. With the information currently available, it is difficult to predict in what time normality will return,” Agrosuper said in its earnings statement. “However, the beginning of the vaccination process makes it possible to expect that mobility restrictions will decrease over time, allowing the demand for our products to return to historical levels.”
The company anticipates that as COVID-19 restrictions begin to ease, the aquaculture segment will likely recover.
“In the aquaculture segment, with the beginning of the vaccination process, we can anticipate a gradual opening of the foodservice channel, the recovery of demand in relevant markets (such as the U.S.A., Brazil, and China) and the stabilization of global logistics services, which together with the synergies derived from the integration of the salmon-producing companies acquired in 2018, should have a positive effect on business margins by mid-2021,” the company said.
Chile’s salmon sector saw significant consolidation in 2018, with Agrosuper buying 67 percent of AquaChile in an USD 850 million (EUR 771 million) deal. The same day that deal was announced, AquaChile acquired Salmones Magallanes and Pesquera Eden for USD 255 million (EUR 231 million). Weeks previous to that, Agrosuper purchased Friosur through its salmon farmer Los Fiordos.
Photo courtesy of AquaChile
