Strong end to the year drove record high earnings for BioMar
It reported EBIDTA of DKK 397m (US$58m) for the quarter, and overall earnings for 2023 of DKK 1.25bn.
The company expects the strong financial results to continue this year.
Volumes remained stable compared to 2022; BioMar CEO, Carlos Diaz, stressed that the priority for the feed producer is building long-term product collaborations with core customers, rather than chasing volumes. He also highlighted the increasing importance of creating partnerships with suppliers of novel raw materials.
Salmon business
The annual report from BioMar’s owners, Schouw and Co, noted that the feed giant’s salmon division reported a drop in volume sales in the fourth quarter that was driven by lower volumes in Norway, but also in Chile.
“The lower volumes in Norway reflected reduced contract positions, because BioMar has prioritized long-term relationships with fish farmers, but were also due to biological factors and an earlier harvest of fish stock biomass. However, the market momentum was supported by a broad product offering and a focus on commercial excellence, so the division’s earnings improved substantially.”
The EMEA division had volume sales slightly below the level of the fourth quarter of 2022. Its revenue also declined, driven by the markets of the Mediterranean region, with earnings slightly below those for Q4 2022.
Low shrimp prices
The LatAm business saw “substantial improvements” in both volume sales and revenue in the fourth quarter. Stronger contract positions in a market otherwise challenged by low prices on farmed shrimp contributed to the improved earnings, according to the producer.
BioMar has revised its expectations for the shrimp feed market in Vietnam based on ongoing disease challenges and pricing issues there.
Icelandic feed project
In August 2022, BioMar signed a letter of intent with an Icelandic business partner, Síldarvinnslan, a processor of fishmeal and fish oil, to establish feed production in Iceland. Aquaculture has evolved strongly in Iceland in recent years with a significant focus on sustainability. However, Schouw & Co’s review shows those efforts were not fruitful, with the result that BioMar is now exploring other opportunities for setting up feed operations in that country.
