Benchmark boss upbeat despite weaker results

The performance of aquaculture biotechnology company Benchmark Holdings in the first half and second quarter of its financial year demonstrated “good momentum”, chief executive Trond Williksen said today, despite the company making an operating loss.

Figures for the first half of the 2024 financial year, which started in October 2023, were weaker than in the same period the year, with revenue down from £98.7 million to £80.2m, and the company moving from a £1m H1 2023 operating profit to a £3.7m loss.

The reasons for this included the Health division recording reduced of £11.5m (H1 2023: £19.1m) because of reduced capacity for Benchmark’s Ectosan Vet / CleanTreat delousing service as the company transitions to a new business model. Benchmark has decommissioned one of two platform service vessels equipped with CleanTreat, which filters Ectosan residues from treatment water, and plans to do so with the other vessels due to high running costs.

It is relying on the development of alternative operating models for Ectosan Vet and CleanTreat including barge and wellboat configurations.

Transition to new model

“We remain focused on the transition to a new business model for Ectosan Vet and CleanTreat which will strengthen our sea lice solutions portfolio and deliver a much-needed alternative to our customers,” said Williksen.

“With our unique platform of mission critical specialised solutions in areas where we hold market leading positions, we are strongly positioned to continue to deliver growth and to build sustainable shareholder value.”

UK-registered Benchmark's results are also skewed by the fact that it presents its figures in sterling but much of its income is in Norwegian kroner, which is weaker against the pound than it was a year ago, creating a negative currency effect.  

Success in Chile

In the Genetics division, Benchmark reported excellent progress in Chile, with new customer wins. It has also launched a new product portfolio in salmon genetics, and a genotyping product portfolio.

Significant progress has been made in key innovation areas, with a complex gill disease (CGD) project bolstered by a new partnership funded by the Biotechnology and Biological Sciences Research Council in the UK.

In the Health division, Benchmark enjoyed strong sales of lice medicine Salmosan Vet.

“The company is trading in line with management’s expectations for the full year,” wrote Benchmark.

“There is good visibility of revenue in Genetics including excellent progress in Chile, and there have been no operational or financial consequences from the infectious salmon anaemia (ISA) incident reported in February (in Norway) this year.

Green shoots in nutrition

“In Advanced Nutrition, there is continuing strong performance in soft markets albeit with some green shoots and the business is well positioned for market recovery.

“In Health, our focus remains on the transition to the new business model for Ectosan Vet and CleanTreat. We will continue to manage costs and reduce our capital exposure, taking the second CleanTreat unit out ahead of the low season for sea lice treatments. Our established sea lice treatment Salmosan Vet is performing well into the second half of the (financial) year.”

A formal review of the company’s strategic options including a potential formal sale process remains ongoing.