Aquaculture solutions provider Benchmark Holdings PLC was hit by a pre-tax loss of GBP 73.3 million (USD 94.6 million, EUR 85.5 million) from continuing operations for the year through 30 September, 2019, compared with a loss of GBP 8.4 million (USD 10.8 million, EUR 9.8 million) posted for the previous 12 months.
The U.K.-headquartered company cited falling revenues and an impairment charge from reduced forecasts in its Advanced Nutrition division as the main reasons for the widening loss.
Revenues from continuing operations for the year fell 3 percent to GBP 127.3 million (USD 164.4 million, EUR 148.5 million), with adjusted earnings before interest, tax, depreciation, and amortization and impairment (EBITDA) of GBP 12.1 million (USD 15.6 million, EUR 14.1 million), down 37 percent year-on-year.
In its full-year results statement, Benchmark stated that 2019 was a “challenging year” for Advanced Nutrition, with revenues down 10 percent to GBP 76.8 million (USD 99.2 million, EUR 89.6 million). Mediterranean sea bass and sea bream markets were affected by oversupply, which saw prices drop to levels not seen since 2012. Similarly, its main customers in shrimp faced declining prices and negative margin development, which led to reduced production, and has also affected the demand for Benchmark’s products.
In regard to Artemia, the division’s main product, the situation was exacerbated by strong harvests and increased competition, which resulted in price pressure.
While some recovery is expected in 2020, Benchmark said this is unlikely to reach the levels achieved in 2018.
However, the outlook in the salmon market remains positive.
Meanwhile, its Genetics division continued to perform well in 2019, achieving revenues of GBP 39.7 million (USD 51.3 million, EUR 46.3 million), up 11 percent thanks an increase in salmon egg sales.
Overall, the company expects to deliver underlying adjusted EBITDA from continuing operations in line with this year in FY2020 and to maintain sufficient liquidity to execute its product development program and support its continuing operations.
Progress is also being made towards the launch of its next generation sea lice treatment BMK08, together with its co-dependent technology CleanTreat, and also its specific pathogen resistant (SPR) shrimp, Benchmark said.
“Following these disappointing results, and the management changes announced in August, our priorities for the coming year are to deliver the program of disposals and restructuring, to obtain regulatory approval and prepare for launch of BMK08 and CleanTreat and to execute our strategy in our core business areas of Genetics and Advanced Nutrition, including the launch of SPR shrimp and the expansion of our health and specialist diets segments in Advanced Nutrition,” Benchmark Executive Chairman Peter George said. "There is a growing need in the market for solutions that improve the sustainability of food production in aquaculture. Benchmark's focus on delivering products and solutions that improve animal health and welfare, and that reduce environmental impact, positions it as a leader in raising the sustainability standards in aquaculture."
