Atlantic Sapphire expects USD 3 million hit after losing 400 tons of salmon

Atlantic Sapphire is facing an estimated USD 3 million (EUR 2.5 million) loss after an accident ocurred in one of its salt-water grow-out systems at its farm in Denmark on 9 July.

The company estimated it has lost approximately 400 metic tons of fish, equivalent to about 17 percent of its annualized harvest volumes from the Denmark facility at steady-state production.

“The company’s preliminary analysis, which remains subject to change, indicates that maintenance work performed in the filtration system caused water quality to quickly deteriorate, resulting in elevated mortality,” Atlantic Sapphire wrote in a statement submitted to the Oslo Børs stock exchange on Sunday, 11 July. “Atlantic Sapphire is continuously improving its operating procedures to ensure that all actions taken by the farm operators do not pose a risk to the stability of the systems, therefore impacting the fish. However, human error altered the water levels in the RAS system and allowed previously stagnant water to flow into the tanks. To minimize the risk of a similar incident reoccurring, the company has updated certain operating procedures and such changes will take effect immediately.”

The company said its grow-out systems in Denmark, having a large standing biomass, were unable to be split like the system at its U.S. facility in Miami, Florida, U.S.A., which was upgraded after a separate mortality event there in March 2021. In that accident, it lost the equivalent of 500 MT of head-on gutted fish, with an average weight of one kilogram each, the equivalent of 5 percent of Atlantic Sapphire’s annualized production volume. At the time, the company estimated the incident would cost it USD 3.5 million (EUR 2.9 million) over what it will recoup from insurance. In April, its stock price plummeted. In contrast a trading update released Friday, 9 June suggested the company’s outlook was trending upwards. The company now has "prime conditions to make modifications which will reduce the impact of future mortality events in a system," it said. in the second half of 2021.

Atlantic Sapphire’s interim financial statement for the second quarter will be released on 27 August. The company also expects to release an update on its strategic approach for U.S. future expansion at that time.

Photo courtesy of Atlantic Sapphire