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Russian Aquaculture off to a strong start in 2021; more acquisitions in its plans

Russian Aquaculture, the country's largest salmon farming company, saw improvements in its key financial results in the first quarter, amid a backdrop of acquisitions.

The group's revenue increased 12 percent year-on-year to RUB 3.9 billion (€44.6 million/$54.4 million), however adjusted earnings before interest, tax, depreciation and amortization (EBITDA) reached RUB 1.5 billion (€17.1 million/$20.9 million), down 7 percent from the previous year.

Net losses decreased 75.5 percent to RUB 82 million (€938.9 thousand/$1.1 million), compared with the first quarter of 2020.

In March 2021, Russian Aquaculture successfully placed three-year bonds totaling RUB 3 billion (€34.3 million/$41.8 million).

The company’s financial performance were supported by an increase in production volumes. Harvest volume increased 26 percent year-on-year, with sales volumes climbing 28 percent to reach 7,800 metric tons.

Biomass at the end of the reporting period jumped 116 percent to 22,000 metric tons.

New acquisitions

Russian Aquaculture is actively pursuing an acquisition strategy this year.

In January, the company signed an agreement for the use of a fish farming area in Pitkov Bay with capacity up to 10,000 metric tons per cycle.

Then in April, the company won an auction and signed an agreement in May for a farming site in Kislaya Bay with a capacity running from 7,000 metric tons to 10,000 metric tons per cycle.

In May, Russian Aquaculture acquired an additional 60 percent stake in Murmansk-based seafood processor Tri Ruchja and Murmanrybprom for RUB 358.5 million (€3.9 million/$4.8 million), bringing its ownership stake in its processing plant to 100 percent.

Certified to the Marine Stewardship Council (MSC) and the Aquaculture Stewardship Council (ASC) standards the facility is capable of producing 30,000 metric tons of products annually and is fitted with modern equipment for processing salmonids.

The acquisition opens up new opportunities for the company to expand its range of Inarctica branded products.

“We started the year on a strong note, achieving excellent results,” said Russian Aquaculture CEO Ilya Sosnov.

“We enjoyed considerable increases in the volume of harvest and sales, received two new fish farming sites and completed a deal to increase our stake in the fish processing plant to 100 percent, which is another step towards the implementation of the company’s strategy to create the largest vertically integrated player in the domestic aquaculture sector.”

Russian Aquaculture is one of Russia’s leading Atlantic salmon and trout producers farming in the Barents Sea in the Murmansk region, as well as in the lakes of Karelia, owning 38 sites for salmon and rainbow trout farming, with total potential production volume of around 50,000 metric tons of salmonids.

Its development strategy provides an increase in production to 35,000 metric tons by 2025.