BioMar hit by rising supply, transport and energy costs
Danish feed giant BioMar faced the triple challenges in its third quarter of global increases in raw material prices, logistic costs, and energy prices.
The EBITDA (earnings before interest, taxes, depreciation and amortisation) for the quarter fell from DKK 326 million (£37.5m) in Q3 2020 to DKK 282 million (£32.4m) in Q3 2021.
However, there was a significant increase in volumes, up 11% year-on-year, and revenue, which was up by 17%.
BioMar CEO Carlos Diaz said: “Looking at the world around us, we are now in the middle of a situation that is completely changing factors of our industry’s cost structure in a way and at a speed that we have not seen before.
“Through the pandemic, it has been difficult to conduct business, but our business model is founded upon a belief in local agility and empowerment of our business units, which has enabled us to find strong commercial paths together with our customers.
“Now that the game is changing completely, we need, as an industry, to find solutions on how to overcome this volatility.”
He added: “The current situation of high prices of raw materials, freight and energy is unfortunately not expected to improve over the next few months and the general supply situation is expected to remain challenging.
“While it will affect our earnings in the short term, we will make it a priority to be able to ship goods continually to customers worldwide as we play an important role in the supply chain.”
BioMar has lowered its 2021 EBITDA guidance to the DKK 890–920 million range from the previous estimate of DKK 940–985 million.