Aarhus, Denmark-headquartered aquaculture feed supplier BioMar Group posted increased earnings for the second quarter of 2021, despite encountering significantly higher raw-material prices and logistics costs in the three-month period.
BioMar’s revenue for Q2 increased by DKK 163 million (USD 25.7 million, EUR 21.9 million) to DKK 2.86 billion (USD 451.8 million, EUR 384.6 million), with 322,000 metric tons (MT) sold, compared with 310,000 MT in Q2 2020.
Its earnings before interest, taxes, debt, and amortization (EBITDA) for the period was DKK 215 million (USD 34 million, EUR 28.9 million), which was DKK 7 million (USD 1.1 million, EUR 941,255) less than a year previously.
In a press release, BioMar reported increased volumes sold in all divisions except salmon. The increase of volumes sold in Europe and Australia were counterbalanced by a decrease in volumes sold in Chile, resulting from several factors – including reduced biomass, an algae bloom, and a local strike in one of three production facilities.
“We have managed to keep a good position in the markets despite intense competition for volumes and a situation where we have not been able to fully offset the steep increase in raw material prices,” BioMar CEO Carlos Diaz said. “Our development of new product solutions and the close collaboration with our customers during this pandemic period of volatility have been important drivers of our expansion in customer portfolio and volumes.”
According to BioMar, the global recovery trend from the COVID-19 pandemic has been seen across species and in Latin America, while its shrimp feed business has benefited from improved conditions in the market and is recovering from the consequences of export restrictions.
The combination of an increasing biomass and a new mix of technical services, product solutions and value chain driven collaboration with customers, has placed the company in a “solid” market position, it said.
Diaz highlighted that the global aquaculture industry has started to recover from the closing of foodservice sectors, as well as export and logistic challenges, and the Mediterranean Storm Gloria which in 2020 destroyed aquaculture net-pen cages in the area.
“However, we are challenged by raw-material prices increasing beyond any expectations. This global development in raw-material prices and freight costs puts pressure on our margins and earnings. We face a very tough scenario for global raw-material development, but I am confident we will be able to deliver solid results for this year,” he said.
Expecting improved volume sales, and based on the higher prices of raw materials, BioMar has raised its full-year revenue guidance by DKK 1 billion (USD 158 million, EUR 134.5 million) to around DKK 13 billion (USD 2.1 billion, EUR 1.7 billion).
The company has also reduced its EBITDA guidance to a range between DKK 940 million to DKK 985 million (USD 148.5 million to 155.6 million, EUR 126.4 million to 132.4 million), and raised the forecast for the share of profit from associates and joint ventures to DKK 50 million (USD 7.9 million, EUR 6.7 million).
Photo courtesy of BioMar
