Salmones Camanchaca beginning to put troubled period behind it Q3 results confirm

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Salmones Camanchaca has reported an operating revenue of $66 million for the third quarter of 2021, a 19 per cent increase compared to the corresponding period in 2020. 

EBITDA for the quarter ended at $3.6 million, compared with negative $3.7 million in Q3 2020. Operational EBIT before fair value adjustments in Q3 2021 was negative at $0.5 million, compared with negative $7.6 million in Q3 2020. The improvement is mainly attributable higher prices.

The Chilean fish farmer reports a 19 per cent decrease in the harvest volume  compared to the corresponding period of 2020, reaching a total volume of 9,508 tons WFE with an average weight of 4.2 kg.

Prices in the quarter were up 48 per cent year-over-year. The company experienced good price realization during the period, capturing market price increase with value added product strategy. This increase was offset by high contract share limiting volumes available for spot exposure.

Harvest costs for the quarter ended at $4.18 /kg live weight, 36 per cent above Q3 2020. This is mainly due to continued harvest from sites in the Reñihue affected by severe feeding limitations and high mortalities due to algae blooms.

Read more: Salmones Camanchaca hit by new algae bloom

Continued cost reductions
However, there was a gradual improvement in costs during the period especially after completing harvest of all Reñihue sites in August. Compared to previous quarter, costs were down $0.74/kg. Processing costs ended at $1.04 /kg during the quarter, slightly above long-term target of $1/kg. The company see continued cost reductions going forward and expects costs to return to normal during Q1 2022.

On October 18, an extraordinary general meeting approved a share capital increase of up to $30 million, to support the 2021/2023 investment plan allowing production in sites with lower risk of algae blooms and lack of oxygen, to recover the biomass lost during H1 2021, and to strengthen the overall financial position of the company.

Read more: Salmones Camanchaca shareholders unanimously approve $30m capital increase

The placement is expected to be completed by the end of 2021. Salmones Camanchaca’s Atlantic harvest estimate for the full year 2021 is unchanged at 40,000-41,000 MT WFE while in 2022 at 46,000-48,000 MT.

Reactivation of the demand
Commenting on the performance of Salmones Camanchaca, vice chairman Ricardo García, said: “The reactivation of the demand seen this year, and the actions taken to better face the risks associated with environmental incidents such as blooms, confirm the benefits and attractiveness of our activity whose roots are the advantages that the south of Chile has.”

He continued, “We are not only working on recovery, but also on having a more sustainable salmon farming of which we are all proud, which makes us look to the future with optimism”.

García also highlighted that “this third quarter shows that we are leaving behind the very weak results we had as a result of the fall in demand due to the pandemic and the impacts of algae blooms from a very dry and sunny summer, and that we should see margins normalize in the months to come. This is especially pertinent in light of the capital increase that Salmones Camanchaca is preparing, and who´s controlling shareholder has declared that it will subscribe and pay”.