Release Date: November 14, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Salmones Camanchaca SA (XSGO:SALMOCAM, Financial) achieved a significant increase in EBITDA to $9.2 million in Q3 2024, up from $2.9 million in Q3 2023.
- The company reported a reduction in production costs for Atlantic salmon, with ex-cage costs decreasing by $0.61 per kilo compared to the previous year.
- Salmones Camanchaca SA maintained a price premium of $0.76 above the market reference for Atlantic salmon due to its value-added strategy.
- The company demonstrated excellent biological performance with low mortality rates and good sanitary indicators, outperforming industry metrics.
- Net debt was reduced to $150 million, reflecting improved financial management and a stronger financial position.
Negative Points
- Total operating revenues dropped by 12% compared to the previous year due to lower volumes and a slight decline in sales prices for Atlantic salmon.
- Coho sales prices remained 5% below the same period last year, despite recent recovery signs.
- The EBIT per kilo for Coho was negative at $1.28 in the quarter, indicating challenges in profitability for this species.
- Processing costs increased slightly due to a higher share of value-added products and lower volume.
- The Trout joint venture generated a $1.1 million loss, although it was an improvement from the previous year.
Q & A Highlights
Q: Can you provide an overview of the financial performance for Q3 2024?
A: Manuel Arriagada Ossa, CEO, stated that the company achieved an EBITDA of $9.2 million, a significant increase from $2.9 million in Q3 2023. This growth was driven by reduced production costs for Atlantic salmon, improved sanitary and biological conditions, and lower feed prices. However, total operating revenues dropped by 12% compared to the previous year due to lower volumes and a slight decline in sales prices.
Q: What are the expectations for harvest and sales volumes in Q4 2024?
A: Manuel Arriagada Ossa, CEO, mentioned that the company expects higher activity levels in both harvest and sales volumes compared to Q3. The total harvest for the year is estimated to be between 51,000 tonnes and 54,000 tonnes for both species, in line with previous forecasts.
Q: How did the company manage to achieve a price premium for Atlantic salmon despite lower market prices?
A: Manuel Arriagada Ossa, CEO, explained that the company achieved a $0.76 price premium above the market reference due to its value-added strategy and flexibility in markets and formats. This strategy involves increasing the added value of products and associating sales with medium-term commercial agreements with key customers to mitigate volatility.
Q: What are the key factors contributing to the improved biological performance of Atlantic salmon?
A: Manuel Arriagada Ossa, CEO, highlighted that the exceptional biological performance, particularly lower mortality rates, is attributed to improved farming practices. The company outperformed industry metrics in most variables, including mortality, feed conversion, growth, cycle length, and antibiotics consumption.
Q: What is the company's financial outlook and strategic focus moving forward?
A: Daniel Alejandro Bortnik Ventura, CFO, stated that the company maintains its harvest guidance for 2024 and expects a 10% increase in Atlantic harvest for 2025. The focus remains on reducing costs, improving production efficiency, and maintaining a strong financial position. The company also aims to continue its strategy of adding value to products and securing stable prices through commercial agreements.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
