Does Atlantic Sapphire need to raise more equity?

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Pareto believes the company needs more to fund other construction phases in Florida.

According to E24, investment bank SEB predicts that the land-based fish farming company will present a deficit of more than NOK 850 million (€85 million) for 2021, and estimates a new deficit of NOK 462 million (€46 million) this year. While the average of the investment banks that follow Atlantic Sapphire expects profitability from 2023, SEB does not believe this will happen until 2024, and then with a narrow profit of NOK 30 million (€3 million).

Atlantic Sapphire estimates that it will cost close to NOK 2 billion (€200 million) to expand the Miami plant in 2022, which will increase annual production capacity to 25,000 tonnes of salmon. CFO Karl Øystein Øyehaug has previously stated that the company’s strategy is to finance the second construction phase with a combination of cash and bank debt.

Atlantic Sapphire last raised new equity in June last year, when NOK 1 billion (€100 million) was injected at a price of NOK 98.60. The funds were to be used to partially finance the second construction stage.

On Friday, the share price ended at NOK 44.15.

Pareto Securities believes the company must raise new equity to fund the second construction phase.

“I agree that Atlantic Sapphire needs $100 million in new equity,” said Pareto analyst Carl-Emil Kjølås Johannessen to E24.