Benchmark, the aquaculture biotechnology business has announced its unaudited results for the three months ended 30 June 2024 (Q3 FY24). Group revenues of £30.7m were 10% below prior year and were driven by
• Advanced Nutrition which showed a 4% increase against the prior year despite continuing softness in the shrimp market.
• Genetics had solid trading albeit revenues were 18% below Q3 FY23 reflecting a shift from direct egg sales to indirect sales through Salmar Genetics, the Group’s JV in Norway, as well as a timing difference in harvest income compared to last year.
• Health revenues were 43% below last year reflecting the decommissioning of the two CleanTreat® units as part of the planned transition to a new business model for Ectosan® Vet and CleanTreat®
Benchmark’s operating loss was £6.5m as compared to £4.0m loss for Q3 FY23. It also announced that group revenues were £110.9m, 17% below the prior year due to:
• Soft conditions in the shrimp markets throughout the year
• Normalised egg volumes in Genetics against last year coupled with shift from direct egg sales to indirect sales through the Group’s JV in Norway
• Lower Health revenues following the decommissioning of the two CleanTreat® units
“This resulted from revenue growth in Advanced Nutrition of 4% (+11% CER) offset by 18% lower revenues in Genetics (-17% CER) and a 43% drop in Health revenues (-41% CER) following the decommissioning of the CleanTreat units,” said Benchmark in its Q3 FY24 report.
Advanced Nutrition showed good trading in Q3 FY24 against backdrop of continuing softness in the shrimp market. Lower margins were due to product mix and higher logistics costs as a result of temporary disruption to trading routes with freight vessels avoiding the regional insecurity of the Suez Canal by travelling around Cape of Good Hope.
The shrimp market remained soft with green shoots not yet translating into market recovery. Despite this the fundamentals remain strong.
Chief executive Trond Williksen, said,
“We maintain commercial focus and take action to optimise our performance and competitive position including by expanding our product portfolio and strengthening our presence in key markets.
“ Regulators and market participants taking steps to support the aquaculture sector e.g. reduction of import duty on aquaculture supplies in India and development of value-added shrimp products in Ecuador to stimulate exports.”
Strategic review
In January 2024, the Company announced that the Board had unanimously decided to undertake a formal review of the Company’s strategic options including a potential formal sale process. This process remains ongoing and further updates will be provided as appropriate.
Trond Williksen, CEO, commented,
“Our two largest business areas, Advanced Nutrition and Genetics, performed well in Q3. In Genetics, it is particularly pleasing to see continued progress in our Chilean business as well as the positive results of the recent reorganisation of our shrimp genetics activities. Our Advanced Nutrition business remains resilient to the continuing soft conditions in the shrimp markets and is well positioned for market recovery.
Having streamlined our Health business, rightsizing it to focus on Salmosan® Vet during the transition period to a new business model for Ectosan® Vet and CleanTreat®, we now have a profitable business which maintains its capability to deliver Ectosan® Vet and CleanTreat®.”
