Lobster processing. (Photo: Clearwater/FIS)
Clearwater's sales rise while net loss soars
Monday, August 13, 2012, 02:10 (GMT + 9)
Clearwater Seafoods Incorporated’s results for the second quarter of 2012 had sales of CAD 85.0 million (USD 85.5 million) and EBITDA of CAD 16.5 million (USD 16.6 million), representing year-on-year growth of 7.8 per cent and 37.1 per cent, respectively.
At the same time, its net loss soared to CAD 2.5 million (USD 2.52 million) in the three months that ended on 30 June versus a net loss of CAD 327,000 (USD 329,086) in the same 2011 period, partly due to a big debt settlement and refinancing charge.
Year-to-date sales have reached CAD 155.9 million (USD 156.9 million) -- a 5.3 per cent year-on-year jump and EBITDA rose by 24.7 per cent, reaching CAD 27.5 million (USD 27.7 million).
The higher EBITDA resulted from higher sales prices and volumes, partially offset by a shift to lower margin species and higher harvesting and procurement costs per lb in certain species. Higher sales volumes resulted mostly from the timing of offshore coldwater shrimp landings and strong market response in China.
Management expects earnings to remain robust in H2 as inventory levels dip and margin improvements from better catch rates are realized in gross margins.
In addition, the firm states global demand for seafood is exceeding supply and consumers are now willing to pay more for consistent quality and food safety, wide diversity and reliable delivery of premium, wild, sustainably harvested seafood. And it is thought that this situation creates favourable market conditions for firms like Clearwater, which is well positioned as a vertically integrated seafood company.
“Management is satisfied with the progress made in the second quarter and year-to-date towards our 2012 long-term financial targets," commented Ian Smith, CEO. "The Company's continuing strong earnings momentum, the CAD 450 million (USD 452.9 million) independent valuation of our quotas by TriNav Fisheries Consultants Inc and the positive ratings issued by Moody's and Standard and Poors all contributed to Clearwater's ability to refinance its debt facilities on favourable terms in the second quarter, thereby providing the company with the capital structure necessary to execute our growth plans while further reducing overall leverage."
The CEO also noted that the Marine Stewardship Council (MSC) certification achieved for Arctic surf clams and Nova Scotia snow crab fisheries in July 2012 further supports the company’s leadership position in sustainable seafood.
- Clearwater sees growth in EBITDA, sales in Q1
By Natalia Real