Nova Austral turned loss into profit in Q1
Published
Debt-laden salmon farmer Nova Austral made a profit of US $11.1 million in the first quarter of 2024, a big turnaround on the $29.3m loss made in the same period last year.
EBITDA after adjustments also reversed from a heavy loss of -$31.8m in Q1 2023 to an operating profit of $16.3m.
Norwegian-owned Nova Austral, which farms Atlantic salmon in the Magallanes region of Chile, recorded revenues of $28.4m, 7% lower than in Q1 2023, on a similar harvest volume. The biggest factor in the reduced revenue was that smolts were not sold to third parties.
Reduced costs
The salmon farmer’s costs fell 17% to $23.9m, due to improvements in harvesting, processing and packaging. The company also has greater biomass in its farms, which are its own since it is no longer part of a joint venture.
Nova Austral’s cash balance was $9.3m, almost six times greater than the $1.6m at the same time last year.
Nova Austral has debts of $559m, and in January - after months of disagreement – Porvenir’s Court of Letters and Guarantee and a majority of the company’s creditors approved a judicial reorganisation plan designed to solve the financial problems through debt restructuring, capital injections, and a change of ownership.
Bankruptcy order
The move hands ownership to the salmon farmer’s primary creditors but feed producer Nutreco, which is owed $23m, and another creditor, smolt supplier Salmonera Dalcahue Limitada, successfully challenged the plan in the same court on May 13 and asked the company to be made bankrupt instead.
The Court of Appeals of Punta Arenas has now decided to freeze Nova Austral’s liquidation after another feed producer, EWOS, owned by US farming giant Cargill, presented a de facto appeal against the Porvenir court ruling.
Nova Austral has separately filed an appeal against the resolution that declared it bankrupt. It pointed out that the bankruptcy order process would put more than 650 directly employed workers of Nova Austral on the street, and endanger the jobs of nearly 3,000 other workers who directly or indirectly depend on the company.
