BioMar’s Q2 volume, revenue outpace rising costs

Denmark-based aquaculture feed supplier BioMar Group posted increased earnings for the second-quarter of 2022, despite higher raw material and energy prices and the ongoing impact of its suspended trade with Russia.

BioMar’s revenue for the last quarter increased by DKK 1.19 billion (USD 162.9 million, EUR 160 million) to almost DKK 4.05 billion (USD 554.3 million, EUR 544.6 million). That revenue coincided with an increase in sales volume, with 352,000 metric tons (MT) of feed sold compared with 322,000 MT in Q2 2021.

Its earnings before interest, taxes, debt, and amortization (EBITDA) for the period was DKK 261 million (USD 35.7 million, EUR 35.1 million), which was DKK 50 million (USD 6.8 million, EUR 6.7 million) more than a year previously.

In a press release confirming the Q2 results, BioMar stated that the 42 percent increase in revenue was driven by higher sales volumes, raw material prices, and to some extent currency rate developments.

“I am proud to announce the strong growth trend in sales volumes being confirmed. Production costs continue to be a challenge, but together with our customers, we have been able to find commercially viable solutions, safeguarding the strength of the value chain,” BioMar Group CEO Carlos Diaz said.

The company added that its earnings continue to be impacted by a delay in passing on the sharp increase in raw materials prices and logistics and energy costs – as well as by the cost of replacing raw materials from Russia/Belarus.

In this regard, Diaz said it was “heart-warming” to see that several of the company’s customers “have drawn the same line in the sand,” despite the short-term business impact.

“BioMar is a purpose-driven company, and to me, business ethics and our ability to protect our customer’s brands must always come first,” he said. “It is still surprising and disappointing to witness some of our main global competitors continuing to trade with Russia, both selling feed and buying raw materials, in a way taking advantage of the situation. We still strongly believe we took the right decision despite the financial effects.”

Based on the strong business activity in the second-quarter and the improved prospects for the rest of the year, BioMar has raised its earnings guidance for 2022 by DKK 55 million (USD 7.5 million, EUR 7.4 million) to EBITDA in the DKK 910 million to DKK 960 million (USD 124.5 million to USD 131.4 million, EUR 122.4 million to EUR 129.1 million) range after recognition of provisions for losses on assets related to Russia.

Photo courtesy of BioMar