Benchmark revenues rise in third quarter

Aquaculture biotechnology company Benchmark reported a 28% improvement in third-quarter revenues on Thursday, to £36.3m.

The AIM-traded firm said its genetics operation delivered an “excellent performance”, with revenues up 50% year-on-year thanks to higher sales of salmon eggs and harvest revenues. Year-to-date revenues in genetics were 29% firmer.

Advanced nutrition reported revenues 5% above the prior year, in line with its anticipated seasonal pattern, while year-to-date revenues were up 15%.

Health division revenues surged 213%, driven by the ‘Ectosan Vet’ and ‘CleanTreat’ products, with revenues for the year to date up 308%.

Adjusted EBITDA, excluding fair value movements from biological assets, were ahead 26% in the third quarter as a result of higher revenues, higher asset utilisation and cost discipline.

Benchmark reported an adjusted EBITDA margin of 14% for the period.

For the year-to-date, group revenues were 32% higher, and adjusted EBITDA excluding fair value movements from biological assets was 99% firmer year-on-year.

The board reported an increase in its adjusted EBITDA margin to 17%, from 11% for the first nine months of 2021, which it described as “notable” in a global inflationary environment.

Its operating loss expanded due to depreciation and amortisation from ‘CleanTreat’ units and leased vessels, and the first amortisation of ‘Ectosan Vet’ and ‘CleanTreat’ development costs.

The statutory loss before tax widened due to a “significant” £5.9m increase in net finance costs, which the company put down to a £3.1m foreign exchange loss mainly driven by the translation of dollar-denominated loan balances, abd a £2.3m loss in the fair value of financial instruments related to hedging of its Norwegian krone bond.

Benchmark said the year-to-date impact of those caused a negative movement of £10.7m, increasing net finance costs to £10m for the year thus far.

The company had cash of £37.3m and liquidity of £50.3m as at 23 August, with net debt, excluding lease liabilities, totalling £59.3m.

“The third quarter represents a continuation of the operational and financial progress reported consistently by Benchmark over the quarters following the 2020 restructuring,” said chief executive officer Trond Williksen.

“We continue our dedicated work to realise the potential of the well invested and well positioned platform that Benchmark has become.”

Williksen said the company was “excited” about the development of a new configuration and business model for ‘CleanTreat’, which although reducing its growth rate for the next year, increased the company’s confidence in the solution and enhances its long-term prospects.

“Overall, we expect to continue to deliver further underlying progress in the coming quarters, with the aim of becoming a profitable company supporting the global aquaculture industry with sustainable solutions.”

At 0945 BST, shares in Benchmark Holdings were up 0.73% at 41.35p.

Reporting by Josh White at Sharecast.com.