Revenue, orders and profits up for fish farming supplier

The Norway-headquartered company ended the quarter with revenue of NOK 771 million (£65m), up from NOK 637m in Q3 2018. EBITDA was NOK 115m (NOK 71m) and net profit was NOK 42m (NOK 28m). The sale of Icelandic software company Wise lausnir ehf earned AKVA a net gain of NOK 18m.

AKVA ended the quarter with an order book worth NOK 1.5 billion.

The company’s Cage-Based Technology (CBT) segment made revenue of NOK 651m (NOK 474m), and EBITDA more than doubled from Q3 2018 to MOK 98m (NOK 48m).

Improved margins

Revenue in AKVA’s Europe and the Middle East region, which includes Scotland, dropped to NOK 76m (NOK 106m), but operations in Scotland, Spain and Turkey came in slightly above on revenue compared to Q3 2018.

Earlier this month AKVA appointed David Peach as the general manager of its Scottish branch, located in Inverness. Peach joined AKVA Scotland as commercial director in February.

The biggest revenue rise was in the Nordic region, up to NOK 436m from NOK 245m in Q3 2018. “The margins in our Norwegian barge business are significantly better than third quarter last year, however, there still remains an untapped improvement in project execution,” said AKVA in its Q3 report.

Barge contract

In the Americas region revenue grew to NOK 142m compared to NOK 123m in the same quarter in 2018. A contract for delivery of four barges to a customer in Chile was signed in September contributing to increased order intake from NOK 78m in Q3 2018 to NOK 284m.

Revenues for AKVA’s Land-Based Farming (LBT) segment fell from NOK 124m in Q3 2018 to NOK 92m, although order intake was up to NOK 51m (NOK 34m) and the value of the LBT order book increased to NOK 569m (NOK 359m).

In its outlook for the future, AKVA pointed to a co-operation agreement signed in Q3 with Cooke Aquaculture Inc and a tender project with Russian Sea Aquaculture Llc awarded in Q2.

The agreement with Cooke involves the development of land-based smolt facilities in Chile, allowing the Canadian company to grow fish to at least 300 grams before they are put to sea.

Optimising production

AKVA said that several new products were launched in Q3 that will strengthen its position within the Nordics. “A strong focus is put on products and solutions for optimisation of production, related to feeding, lice and fish welfare,” said the company.

“The growth in the Americas regions has continued, including a US$12.6m barge contract signed in Q3. While the market for cages may stabilise going forward, significant opportunities exist to further broaden our portfolio and work is ongoing in this regard.

“On the east coast of Canada the sales and supply contract entered into with Grieg NL in Q3 2018, resulted in the first barge being registered in order intake in Q3. In Q2 a letter of intent was agreed with a local partner to form a joint venture to explore service offerings on land and in sea, the work related to this is showing good progress in Q3.”

AKVA said net supplier Egersund Net, which was acquired in Q3 2018, continued to develop successfully.

“In general, the market activity is good in most markets and opportunities exist on a broad basis to further strengthen AKVA’s position.”