Stolt Sea Farm posts lower revenue, profit in Q1 2023

Stolt-Nielsen Limited, the parent company of Santiago de Compostela, Spain-based land-based turbot and sole farmer Stolt Sea Farm, announced the company saw an increase in revenue and in operating profit before fair-value adjustment in Q1 2023 compared to the prior quarter.

Stolt Sea Farm reported Q1 2023 revenue of USD 25.2 million (EUR 23.1 million), up from USD 21.3 million (EUR 19.5 million) posted in Q4 2022, but down from the USD 30 million (EUR 27 million) posted in the same quarter of 2022. The company pointed out that Q1 2023, in its financial calendar, includes peak Christmas season sales, followed by “the weaker January and February.”

The company reported its quarter-over-quarter sales volumes of turbot were up 13.3 percent, and its sales volumes of sole were up 5.7 percent. Prices for turbot decreased by an average of 1.8 percent, but prices for sole increased by 3.2 percent on average. The company said that overall the price of both species “remained stable.”

The company’s operating profit before fair-value adjustment of biomass reached USD 5.6 million (EUR 5.1 million) in Q1 2023, up from USD 3.3 million (EUR 3 million) posted in Q4 2022. However, with fair-value adjustment, it posted a gross loss of USD 2.45 million (EUR 2.2 million) in Q1 2023, compared to a loss of USD 649,000 (EUR 595,240) in Q4 2022. Excluding fair-value adjustment, it posted a Q1 2023 profit of USD 7.6 million (EUR 6.9 million), down from a profit of USD 8.2 million (EUR 7.5 million) in the same period of 2022 but up from the USD 5.5 million (EUR 5 million) posted in Q4 2022. 

The company’s earnings before interest, taxes, depreciation, and amortization (EBITDA) in Q1 2023 were USD 4.7 million (EUR 4.3 million), up from USD 2.5 million (EUR 2.2 million) in Q4 2022 but down from USD 8.1 million (EUR 7.4 million) in Q1 2022.

The company said it took a bigger hit from fair-value adjustments of biomass due in part to price drops. In Q1 2023, the company saw a USD 2.4 million (EUR 2.2 million) loss compared to a USD 1.8 million (EUR 1.6 million) loss in the prior quarter, “reflecting volume and prices impact on inventory levels for turbot.”

Its higher volume of sales also increased its operating expenses, but its price expenditure per kilogram of turbot was down 7.5 percent in Q1 2023. The company's CEO, Niels G. Stolt-Nielsen, credited the drop to “fantastic growth” during the quarter. He called the drop in expenses proof of the ability of land-based recirculating aquaculture systems to perform well.

“There has been a lot of [negative] writing about land-based recirculation aquaculture, [but] I have to remind you that we have been in this business for 30 years, recirculation we have developed over the last 20 years” Stolt-Nielsen said. “It’s up and running, it is working, and these guys are really in control of their operation costs.”  

Photo courtesy of Stolt-Nielsen Limited