Revenue up but EBITDA plunges for OTAQ
OTAQ, which supplies marine technology for the aquaculture and offshore energy industries, increased revenue by 5.9% to £4.292 million in its 2021/22 financial year, it announced today.
But the UK company’s gross profit fell by 12% from £2.303m in 2020/21 to £2.027m, and adjusted EBITDA, a measure of operating profit, fell 109.4% from an operating profit of £524,000 in 2020/21 to a loss of £49,000.
OTAQ said that while there had been strong revenue and gross profit growth in its Offshore, Connectors and Technology Divisions, the Aquaculture Division was impacted by ongoing regulatory reviews of acoustic deterrent device (ADD) usage, specifically in Chile and Scotland.
ADDs have in the past been used to deter seals in Scotland and sea lions in Chile from predating farmed salmon in net pens. But the technology has been taken out of use at many farms following advice from Scottish government agency Marine Scotland that they might cause harm or disturbance to cetaceans (whales, porpoises, and dolphins), which are designated as European Protected Species (EPS) in law, and that ADDs might therefore require an EPS licence to permit their use.
In November last year, OTAQ issued a trading update saying it had taken mitigating action after one of its main customers gave notice that it would not renew its contract for OTAQ’s SealFence ADD system when it expired in April 2022.
In today’s announcement, OTAQ – which has branches in Aberdeen, Lancaster and Ulverston un the UK and Puerto Montt in Chile – highlighted its encouraging entry into the shrimp biomass measurement market with Minnowtech LLC, its strategic investment of 10% in Blue Lion Labs Ltd and completion of licensing and cooperation agreements, and its continued focus on new product development including its live plankton analysis system for detecting harmful algal blooms.
A broadening portfolio
Chief executive Phil Newby said: “Product innovation is at the core of OTAQ’s ability to partner with clients to maximise welfare and production yields, continually broadening our portfolio of complementary products.
“The addition of technologies in shrimp sonar, live plankton analysis systems and water quality monitoring now give OTAQ and its customers a new level of analysis and responsiveness in managing stocks and improving performance.
“Many of these products have been well received in the Chilean and Scottish markets, with early indications of commercial success, which is central to the Group’s growth strategy.
“Development of new products and the flourishing performance from the Offshore and Connectors divisions gives the directors confidence that the Group can return to profitable growth.”