Nova Austral consider new mergers as well growth opportunities in latest report

News
2058

Big plans in second quarter’s report. 

At the beginning of August, Agrosuper bought Chile’s largest salmon farmers, AquaChile. Now Nova Austral, who farms in the country’s Magallanes and Antarctic regions, announced that they want to be part of the consolidation process in Chilean farming.

“Nova Austral is looking with much interest and attention to the consolidation process that the Chilean salmon industry has been experiencing in the last quarter, with deals involving Salmones Magallanes, Friosur and lately the take over of Aqua Chile by Los Fiordos,” the company said in its latest report.

In this regard, Nova Austral is now exploring possible growth opportunities, either organically or through M&A (mergers and acquisitions), that could bring value to its shareholders and investors.

According to the company, this plan will increase annual output by more than 40,000 tonnes of salmon. Nova Austral also announced that they reduce 2018 volume guidance from 25,000 tonnes to 21,000 tons. The company maintains its guidance on a total harvest volume for 2019 of 32,000 tonnes.

It was the website Hegnar who mentioned the plans first.

Results 
Lower volumes, plus additional costs associated with poor smolt quality and biomass challenges, will lead the company to a profit margin in the second quarter.

EBIDTA ended at USD 10.7 million (EUR 9.2 million) in Q2 2018 against USD 39.9 million (EUR 34.3 million) in Q2 2017. Revenue dropped in the same period from USD 82,7 million (EUR 71.2 million) to this year’s quarter EUR 62.9 million (EUR 82.7 million).

Smolt
At the moment, the company is building its own smolt plant in Tierra del Fuego Island in the Magallanes region. Today, smolt come from third-hand suppliers north of Puerto Montt, well over 1,500km away. This creates a biological challenge when salmon is transported by wellboat in vulnerable areas, which in effect increases costs. As it stands, it takes around a week to transport the young fish from Puerto Montt to Nova Austral’s farming sites.

According to the company, if everything goes according to plan, the first smolt will be delivered in the fourth quarter of 2019.