Atlantic Sapphire stops second construction phase in Miami

editorial staff

Atlantic Sapphire is struggling to finance the expansion, which will lift the company’s annual production from 10,000 tonnes to 25,000 tonnes of salmon.

The land-based fish farming pioneer has struggled heavily with production for a number of years. On Monday, it became known that Atlantic Sapphire had to accelerate the harvest of fish with an average weight of two kilograms after increased mortality in the tanks .

The harvest of small fish means low price achievement and high production costs per kilo. This in turn leads to poor financial results.

Also read: Atlantic Sapphire share price plunges after negative profit warning

The catch is that the company’s announced expansion of the second construction stage at the plant just outside Miami is conditional on bank financing. The bank financing, in turn, is conditional on the company breaking even in its operations.

“It is correct that we must achieve EBITDA break-even in phase 1 in order to draw on the debt that is earmarked for phase 2. For this reason, we will also not invest significantly in phase 2 until we have succeeded in this,” CFO Karl Øystein Øyehaug wrote in an email to Dagens Næringsliv.

Øyehaug wrote that the ongoing development of phase 2 thus “may be delayed by a few months”.

He did not answer DN directly about whether the company must raise new equity via the stock exchange.

In that case, it could be at very low prices, with corresponding dilution for existing shareholders, as Atlantic Sapphire falls to a new low on Tuesday. The share last traded at NOK 5.40, after a price drop of 22.7 per cent. The company’s stock market value has more than halved in two days.

Photo: Atlantic Sapphire

Related Articles