Nueva Pescanova's headquarters in Chapela-Redondela, Galicia, Spain.
Photo: Nueva Pescanova.
The operational efficiencies implemented by the new management team of Nueva Pescanova have proved to be a success. In just five months - from April, when its accounting year opened, to August - the Spanish seafood company generated an EBITDA of EUR 18.1 million (USD 19.9 million), which is almost double - up 185% - the EBITDA of the whole previous year, which was EUR 9.8 million (USD 10.7 million).
According to the company, this positive evolution in the first months of the current fiscal year allows it to conclude that Nueva Pescanova has been able to reverse the trend and estimate that by the end of 2024, it will reach an EBITDA of EUR 37.5 million (USD 41.3 million), i.e. almost four times the EBITDA of the entire fiscal year 2023-24.
After the resignation of the former CEO, Ignacio González, and the failure to reach an agreement to sell the company to Cooke, the main shareholder - the Spanish bank Abanca - decided to maintain ownership. Thus, in September 2023 Nueva Pescanova announced two important measures: the layoff of a hundred employees from its central services, and the appointment of a new CEO, Jorge Escudero.
With his incorporation, the company entered a new phase in which the Executive Management Committee has been simplified and renewed to streamline decision-making. Among other measures, the new management team has adopted a new business plan, a new commercial reorganization, the redesign of processes to improve service and increase operating efficiencies, and the optimization of working capital.
These strategic and operational measures have reversed the company's negative trend of the last two years and put it on the road to recovery, achieving a 2% increase in revenues in the first five months of 2024 compared to the same period of the previous year.
Thus, the Consolidated Annual Accounts 2023-2024 - to be submitted for approval at the Nueva Pescanova General Shareholders' Meeting to be held on September 26th - reflect sales of EUR 970 million (USD 1 billion) and a negative result of EUR 131 million (USD 144.2 million), of which EUR 42 million (USD 46.2 million) correspond to a provision for impairment to clean up the balance sheet which has no impact on cash flow.
According to the company, these results close the cycle of two consecutive years heavily impacted by extraordinary external factors such as inflation, the exchange rate, and the El Niño weather phenomenon.
Moreover, in order to consolidate the change of phase, the Board of Directors of Nueva Pescanova will also propose to the General Shareholders' Meeting a capital increase of EUR 72.6 million (USD 79.9 million) to finance the future growth of the company.
Abanca, the Spanish bank - from Galicia as Nueva Pescanova - which, as mentioned, is the main shareholder of the Group, has already confirmed that it will participate in the capital increase and will cover it almost completely, guaranteeing at least EUR 71 million (USD 78.2 million) of the EUR 72.6 million. The capital increase will be paid in cash during the fourth quarter of this year.
Before the capital increase, a reduction of EUR 0.31 (USD 0.34) per share in the nominal value of the shares will be proposed, for a total value of EUR 223 million (USD 245.6 million). The objective is to offset losses from previous years and clean up the balance sheet, and, like the impairment provision, will not affect the cash flow.
According to Nueva Pescanova, with the capital increase, local financing and the optimization of working capital management, the Group has managed to restore liquidity and solvency and secure the funds for its 24/28 business plan.
Finally, in line with the company's objectives to simplify operations, the change of the financial year to adjust it to the natural calendar will also be presented for approval at the General Shareholders' Meeting. As mentioned above, until now, Nueva Pescanova Group started its fiscal year in April, therefore, to start with the natural calendar of 2025, the fiscal year 2024 will be adapted and shortened to nine months, ending on December 31.