Proximar Seafood on track for first harvest, raising additional USD 15 million to cover higher costs

Proximar Seafood, which operates a land-based salmon recirculating aquaculture system (RAS) in Shizuoka Prefecture, Japan, said it is on track to have its first harvest in Q3 2024 – but higher costs are also forcing the company to raise an addition NOK 165 million (USD 15.3 million, EUR 14 million).

In its Q3 2023 results update, the company said that its total capex has been updated to NOK 1.24 billion (USD 114 million, EUR 105 million), up from NOK 1.19 billion (USD 110 million, EUR 101 million) in Q2 2023 – a 17 percent increase from the start of construction. The company said that an increase in operational costs and financing require it to raise the additional NOK 165 million. 

Proximar said it plans to perform the capital raise through a combination of debt and equity, and that the timing of a large part of the working capital requirements is in the second and third quarters of 2024 – before its first harvest.

“We are running the very first commercial Atlantic salmon farming facility built in Japan, and with that comes several challenges, among them also some cost increases that necessitate additional funding,” Proximar Seafood CEO Joachim Nielsen said.

Despite the increased costs, the company said it is otherwise on track to transfer its first fish into its growout center in Q4 2023. The company said it is now preparing to transfer the first fish by installing the remaining RAS equipment from AquaMaof in its facility.

The company announced in October that its growth rate was beating its expectations, and in its latest update said that it has seven batches in production as of the end of Q3 2023 and that the growth curves are still ahead of expectations.

“We are excited to take another important step towards our first harvest, with our Atlantic salmon increasing in size,” Nielsen said. “The biological growth is ahead of expectations, and we are on schedule for the transfer of fish to the important next phase in the grow-out building.”

In Q3 2023, the company also completed the handover of its facility, taking ownership of the entire fish farming facility. The event marked the end of construction work by Daiwa House, Proximar Seafood’s construction partner in Japan. 

“Daiwa House has been an important partner for Proximar since 2018, and we are very pleased with their performance. Daiwa House has completed the construction works according to schedule, with excellent quality,” Nielsen said after the transfer.

In conjunction with the ownership handover, the company said it also completed the second and final drawdown of the JPY 8.8 billion (USD 59.4 million, EUR 54.5 million) sustainability-linked loan it received earlier this year.

“The second drawdown is marking the continued strong support shown by the company’s Japanese banks,” Proximar said.

The company said that looking forward, high transportation costs and high salmon prices are making a strong business case for its Atlantic salmon RAS in Japan.

“I’m confident that Proximar will be a leading supplier of Atlantic salmon for the Asian market in the years to come,” Nielsen said.

Photo courtesy of Proximar Seafood