AKVA reports strong financial performance

Positive momentum in the Nordic markets has helped aquaculture technology services group AKVA deliver a bullish set of financial results for the third quarter of this year.

The company said the outlook is good, with salmon prices expected to remain strong driven by reduced supply.

AKVA has reported revenue in Q3 2024 of NOK 1,011m (£71.5m) compared with NOK 817m (£58m) in the same period last year. Adjusted for the gain of NOK 76m related to AKVA’s acquisition of Observe Technologies, the revenue was NOK 936 (£66.2), 14.5% higher compared to Q3 2023.

EBITDA or operating profit was NOK 199m (£14m) in Q3 2024. Adjusted for the net gain of NOK 71m related to the Observe transaction, EBITDA for Q3 2024 was NOK 128m (£9m) compared to NOK 78 (£5.5m) in Q3 2023.

The company said the high activity has driven by the Sea Based business segment and “continued positive momentum” in the Nordic market. The market for Land Based is still soft but the revenue level is gradually increasing.

The award of the “letter of intent” from Cermaq at the beginning of Q4, in relation to a planned smolt facility in Chile with an estimated contract value of €30m (£25m), is expected to have a positive effect on the revenue level in Q4 and onwards.

The company said the outlook for the post smolt market in Norway is still uncertain but is expected to improve gradually into 2025.

AKVA boat

Strong performance in the Sea Based business also contributed to a significant improvement in profitability in the third quarter compared to last year. The profitability in Land Based business is improving partly due to the higher activity level and partly due to improved project margins. The Digital business segment has experienced great revenue growth in the last few years but the current cost base is still high compared to the current activity level resulting in soft profit margins.

The group recorded a total order intake of NOK 803m (£56.8m) compared with NOK 600m (£42.4m) in Q3 2023 and the order backlog was NOK 2.4bn (£170m) at the end of September 2024.

Broken down by divisions:

• Sea Based Technology saw revenue of NOK 740 (£52.3m), up 12% year-on-year. EBITDA was NOK 112 (£7.9m), up 42%.
• Land Based Technology recorded revenue of NOK 162 (£11.4m), up 31%. EBITDA was NOK 5m (£0.35m) compared with a loss of NOK 11m (£0.77m) last year.
• The Digital segment recorded revenue of NOK 34m (£2.4m), up just 3%. EBITDA for the segment was NOK 11m (£0.77m) up 10%.

AKVA said it is aiming for revenue of minimum NOK 3.6bn (£254m) and EBIT of 5% in 2024. The company has decided not to pay any dividend for the second half of 2024.