AquaBounty Technologies Inc (AQB) Reports Q3 2023 Financial Results Amid Market Challenges
AquaBounty Technologies Inc (NASDAQ:AQB) reported a decline in market prices for Atlantic salmon impacting Q3 results, despite exceeding planned output at its Indiana farm.
The company is evaluating the cost estimate for the completion of construction of its Ohio farm, with the total project cost now estimated to be in the range of $485 - $495 million.
AquaBounty has entered into a non-binding memorandum of understanding with Noble Salmon to build and operate a Recirculating Aquaculture System (RAS) salmon farm in the Republic of Georgia.
The company's cash and cash equivalents stood at $16,767,070 as of September 30, 2023, a significant decrease from $101,638,557 at the end of 2022.
On November 7, 2023, AquaBounty Technologies Inc (NASDAQ:AQB), a land-based aquaculture company, announced its financial results for the third quarter and nine months ended September 30, 2023. The company's Q3 results were impacted by a decline in market prices for Atlantic salmon, although the Indiana farm exceeded its planned output.
Financial Performance and Challenges
AquaBounty reported product revenues of $733,133 for Q3 2023, a slight increase from $653,432 in the same period last year. However, the company's total costs and expenses increased to $6,806,984 from $6,190,042 in Q3 2022, resulting in an operating loss of $6,073,851. The net loss for the quarter was $6,138,113, compared to a net loss of $5,440,127 in Q3 2022.
Ohio Farm Construction Update
The company announced in August that it was evaluating the cost estimate for the completion of construction of its Ohio farm. The new estimate for the total project cost is now in the range of $485 - $495 million, substantially higher than previous ranges. This increase is attributed to the inflationary environment impacting labor and materials costs, particularly concrete and piping.
International Expansion
AquaBounty has entered into a non-binding memorandum of understanding with Noble Salmon to build and operate a Recirculating Aquaculture System (RAS) salmon farm in the Republic of Georgia. This project marks the first instance of AquaBounty executing its strategy to enter additional salmon markets through local partnerships in a capital-lite structure.
Financial Position
As of September 30, 2023, AquaBounty's cash and cash equivalents stood at $16,767,070, a significant decrease from $101,638,557 at the end of 2022. The company's total assets were $192,546,335, while total liabilities were $19,357,232. The company's total stockholders' equity was $173,189,103.
In conclusion, despite facing market challenges, AquaBounty continues to see demand for its product and is making progress in its international expansion efforts. However, the company's financial position has weakened compared to the end of 2022, and it faces significant costs related to the completion of its Ohio farm construction.
Explore the complete 8-K earnings release (here) from AquaBounty Technologies Inc for further details.
This article first appeared on GuruFocus.
