Dammam, Saudi Arabia-based Saudi Fisheries Co. (SFC) has announced that despite a significant increase in sales revenue, the company posted a net loss for H1 2022.
SFC’s interim financial results filing to the Saudi Stock Exchange on 22 August, 2022, show the company posted sales of SAR 29.3 million (USD 7.81 million, EUR 7.84 million) up 34 percent from the SAR 21.8 million (USD 5.81 million, EUR 5.83 million) for Q2 2021.
Despite the increase, the company’s net losses widened to SAR 24 million (USD 6.40 million, EUR 6.42 million) for the six months ending 30 June 2022, compared to SAR 19 million (USD 5 million, EUR 5.08 million) for the same period the previous year.
The company has attributed loss to high production costs at its shrimp farm, as well as longer harvest cycles – the first cycle ended in April 2022 and next phase commenced in July 2022.
“Despite the increased sales by 34 percent compared to the same period last year, the net loss increased mainly due to the increased production costs at the shrimp farm,” the company said “Longer harvest cycles and variable costs hiked up the overall production cost.”
The latest quarter, added on to a string of poor financial results, have caused the company’s losses to deepen.
“Total accumulated losses at the end of the second quarter amounted to SAR 152 million (USD 40.53 million, EUR 40.67 million), equivalent to 38 percent of the capital as of 30 June, 2022,” SFC said.
On the announcement of the interim results on 22 August, 2022, Saudi Fisheries Co.’s shares dropped 3.35 percent in value to SAR 37.55 (USD 10.01, EUR 10.04) from SAR 38.85 (USD 10.36, EUR 10.39) posted at the close of the previous trading session.
Meanwhile, SFC said its shrimp farm in Al-Huraida Governorate on the Red Sea coast reported more sales in the first quarter of 2022, earning SAR 12.3 million (USD 3.28 million, EUR 3.29 million), which was an improvement from the SAR 9.79 million (USD 2.61 million, EUR 2.62 million) for a similar period in 2021.
However, the firm's sales in the second quarter of 2022 reached 27.7 percent lower than the SAR 16.98 million (USD 4.52 million, EUR 4.54 million) realized in the first quarter of 2022.
The company said it expects more sales as it strives to increase production from its shrimp farm, which currently has an estimated annual capacity of 1,743 metric tons (MT).
The company recently reached an agreement giving it access additional financing, and as a result, SFC said it is optimistic it can scale up total annual capacity at the shrimp farms to 3,000 MT with the objective of achieving 6000 MT when the ongoing investment plan is fully implemented.
Photo courtesy of Saudi Fisheries Company
