With the measures taken so far, the company has managed to cut the net loss by over 44% compared to the same quarter of the previous year.
Photo: AquaBounty Technologies.
Land-based salmon producer AquaBounty Technologies, Inc. announced this week its financial results for the third quarter and first nine months of the year ended September 30, 2024. Although it continues to record losses, during Q3 2024 the company was able to significantly narrow them.
2024 has not been an easy year for the North American company. In Q1 it reported a net loss of USD 11.2 million (EUR 10.3 million), a figure that by Q2 2024 had increased to USD 50.5 million (EUR 46.2 million). Now, in Q3, AquaBounty was able to down it to USD 3.4 million (EUR 3.1 million).
The figure is not only significant compared to the rest of the 2024 exercise but also compared to the same quarter last year. In Q3 2023, its net loss amounted to USD 6.1 million (EUR 5.6 million), which means that the measures taken by the company since then have managed to cut it by over 44%.
In its release, AquaBounty attributed the sale of the Indiana farm as the main cause of this decline. Wisconsin-based aquaponics company Superior Fresh acquired AquaBounty Technologies' Indiana farm earlier in July. As reported by WeAreAquaculture, the deal closed for a total of USD 9.2 million (EUR 8.4 million), net of expenses.
Now, in its Q3 2024 results presentation, the land-based company said that a portion of the net proceeds was used to repay the bridge loan from the transaction, but Aquabounty is still in need of liquidity.
As of September 30, 2024, at the end of the third quarter and the first nine months of the year, cash, cash equivalents and restricted cash amounted to USD 500,000 (EUR 463,000), compared to USD 9.2 million as of December 31, 2023.
"We continue to focus our efforts on working with our investment banking partner to extend our cash runway, while reviewing a variety of financing initiatives to maintain liquidity," said AquaBounty's President and Chief Executive Officer, Dave Melbourne. "Included in this effort was our decision to market our Rollo Bay farm for sale."
Indeed, in early September 2024, the company announced its decision to sell its Rollo Bay farm operation on Prince Edward Island, Canada. AquaBounty said at the time that it was doing so after exploring "a wide range of financing and strategic alternatives" to strengthen its balance sheet and increase its cash position.
Rollo Bay farm was acquired by AquaBounty Technologies, Inc. in 2016 and has since been developed as a broodstock and egg production operation. Pressed by immediate cash needs, when the announcement was made, the company's investment banker was already conducting the sale process which, it was said at the time, is expected to be completed before the end of the year.
"As I stated in our announcement, the Rollo Bay farm was purchased and developed to support an expansion plan for five large land-based grow-out farms. Since we will not require the egg output from the Rollo Bay farm in the near to mid-term timeframe, and since we will retain sufficient egg production capacity for our Ohio farm from our hatchery in Bay Fortune, we determined that the Rollo Bay farm could be sold at this time to address the company's immediate cash requirements without impacting our long-term strategy," AquaBounty's President and CEO explained.
Dave Melbourne took over from Sylvia Wulf at the helm of the company last June. The move was part of the long-term succession plan for the land-based aquaculture company's leadership team, beginning with his promotion from Chief Commercial Officer to President in August 2023.
In announcing the appointment, the company already noted that Melbourne's responsibilities would include the pursuit of a variety of financing options and strategic alternatives. A task that, as he pointed out in his statements, has continued in Q3 2024.
"We have also been working to reduce costs where appropriate and our results for the quarter show a significant reduction in both our operating spend and our net loss," AquaBounty's President and CEO said.
"We are fully committed to securing the pathway forward for our company and stockholders, and we will continue to work to stabilize the business in the short term and drive value creation in the long term. I look forward to sharing continued updates in the future," Melbourne concluded.