PJSC Russian Aquaculture is the leader in the Russian market of commercial aquaculture, which focuses on the cultivation of salmon and trout

Russian Aquaculture suffered losses in the first half of the year

In January-June, the country's largest producer of salmon and trout, Russian Aquaculture, received 402 million rubles (US $ 5,4M). net loss against 1 billion rubles (US $13,5M) profit a year earlier, the company said. The net loss resulted from the revaluation of biological assets. On June 30, some of the fish did not reach the marketable weighed portion due to the low water temperature. But July and August were favorable, fish growth was strong, and due to this, some of the growth gap has already been compensated for, the report said.

As the Russian Aquaculture CEO noted, Ilya Sosnov, this is due not only to unfavorable climatic conditions, but also to the fall of markets amid the COVID-19 pandemic. Despite the decline in demand for fresh fish as a perishable commodity, sales in the first half of the year increased by 2% to 9.6 thousand tons year-on-year, including due to the proximity to sales markets, the report says. As a result, the company's revenue increased by 8% to 5.25 billion rubles (US $ 71M), operating profit - by 2%, to 2.28 billion rubles (US $ 30,8M), EBITDA - by 5%, to 2.29 billion rubles (US $ 31M) year to year.

Russian aquaculture owns the rights to 36 plots for growing salmon and trout with a total potential volume of about 50 thousand tons of salmon. At the end of 2019, the main shareholder Maxim Vorobyov owned 48.8% of the company, 25% belonged to Svinin & Partners Management Company, which represents the Realty Capital investment fund. Free-float PJSC Russian Aquaculture in the first half of the year grew from 8% to 14%.

Main financial results of the Company

• Despite the decline in demand for fresh fish as a perishable commodity amid uncertainty in the first months of the pandemic, the volume of sales in the first half of the year increased by 2% compared to the same period last year to 9.6 thousand tons. This result was largely achieved due to the strategic the Company's advantages in terms of freshness and quality of fish due to its proximity to sales markets.
  
• Higher sales volumes contributed to an increase in revenue and adjusted EBITDA to RUB 5.3 billion. and 2.3 billion rubles. respectively.
  
• Russian Aquaculture remains one of the most efficient aquaculture companies in the world with EBIT / kg at 214.1 (in rubles) or 2.8 (in euros) based on the results of the first half of 2020.
  
• Strong financial results allow the Company to generate significant cash flow - cash flow from operating activities and free cash flow amounted to 2.4 billion rubles. and 1.2 billion rubles. respectively, which made it possible to invest 1.2 billion rubles. in the further development of the business and offer the payment of interim dividends in the amount of 439.4 million rubles.
  
• The net loss in the reporting period resulted from the revaluation of biological assets. As of June 30, 2020, some of the fish did not reach the marketable weight due to the low water temperature in the first half of 2020. At the same time, July and August were favorable in terms of temperature conditions, fish growth was strong and due to this, part of the growth lag was already compensated.
  
• As of June 30, 2020, the ratio of Net Debt to Adjusted EBITDA for the last 12 months was 0.87x compared to 1.18x as of December 31, 2019. The low level of debt allows the Company, if necessary, to attract financing on favorable terms and while maintaining high financial flexibility, and finance the development program.

Autohr: Anatoly Kostyrev / Kommersant

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Address:	Belovezhskaya str., 4
City:	Moscow
State/ZIP:	(121353)
Country:	Russian Federation
Phone:	+7 (495) 258 99 28
E-Mail:	[email protected]
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