AquaBounty Technologies posted a net loss of USD 6.5 million in the first quarter of 2023, USD 1.4 million more than in the same period last year. This loss contributed significantly to the decline in the North American land-based aquaculture company’s revenues, which were down 59% year-on-year. The salmon company generated USD 398 thousand in product revenue in the first quarter, down from USD 963 thousand in 2022. Nevertheless, the company is still listed on the Nasdaq, and it is not all bad news.
Construction of its new fish farm in Ohio continues to progress, the Indiana farm had its highest monthly harvest production to date in March, and demand for its fish continues to outstrip supply. Moreover, although the company was unable to meet the conditions necessary to avoid delisting by May 1, the Nasdaq Stock Market has decided to extend the deadline to October 30, 2023.
Moving forward despite losses
In announcing the results, AquaBounty CEO Sylvia Wulf linked those losses, and thus the first quarter results, to the company’s need to make planned repairs at its Indiana farm. “The year-over-year revenue decline for the quarter was related to the scheduled downtime needed to make facility repairs“, she stated. “Additionally, with the transition of our PEI grow-out facility to broodstock maintenance and egg production last August, we no longer are harvesting GE salmon from that farm”.
“Demand for our fish continues to exceed our supply, and during March the Indiana farm had its highest monthly harvest output to date”, she continued. Demand the company hopes to continue to meet not only with the new farm in Pioneer, Ohio – which, as Wulf stated, continues to move forward – but with three or four other farms in North America for which she believes there is still room, as she told WeAreAquaculture in an interview during the Seafood Expo North America held last March in Boston.
In that interview, the CEO of AquaBounty Technologies told us about the company’s future plans, which can be summarized in two words: diversification and opportunity. “We are also moving forward in growth areas outside of GE salmon, including expansion of our conventional salmon egg and fry business and potential partnerships in conventional salmon farming outside of North America”, she said now. Indeed, the company’s plans are to diversify its production between GE salmon and conventional salmon, to go beyond North America, but also to open up to other species. Shrimp or tilapia are some of those he mentioned during the interview.
Nasdaq extends the deadline
These positive aspects highlighted by Sylvia Wulf, have been supported by another piece of news that became known almost at the same time as the results. On May 2, 2023, AquaBounty received a notice from Nasdaq granting it an additional 180 calendar days – until October 30, 2023 – to re-comply with the minimum offering price requirement of USD 1.00 per share to remain listed on Nasdaq. The first deadline to meet that requirement and not be delisted had expired the day before, May 1.
“Nasdaq determined that we are eligible for the second compliance period due to us meeting the continued listing requirement for market value of publicly held shares and all other applicable requirements for initial listing on the Nasdaq Capital Market, with the exception of the bid price requirement, and our written notice of our intention to cure the deficiency during the second compliance period by effecting a reverse stock split, if necessary”, David Frank, CFO of AquaBounty Technologies, told WeAreAquaculture by e-mail.
“We intend to monitor the closing bid price of the common stock and may, if appropriate, evaluate various courses of action to regain compliance”, he continued. “AquaBounty intends to take any reasonable measures to maintain its Nasdaq listing within the compliance period”. At the moment, the forecasts look good as investment bank HC Wainwright & Co. has maintained coverage of AquaBounty Technologies with a buy recommendation. As can be read on the Nasdaq website, forecasts range from a low of USD 1.81 to a high of USD 4.72, so the average one-year price target for AquaBounty Technologies is USD 3.01.
AquaBounty Technologies, Inc. is a land-based fish farming expert raising Atlantic salmon to supply nearby markets. It claims that its innovative land-based farms, combined with its expertise in genetic engineering, are the answer to the world’s growing demand for high-quality seafood. The company is currently operating land-based RAS farms located in Indiana, in the United States, and Prince Edward Island, Canada. There is one more farm on the way, a large-scale farm being built in Pioneer, Ohio, U.S.