Blue Star Foods Reports Revenue Growth of 79% for First Half of 2022
August 16 2022 - 6:30AM
Blue Star Foods Corp., (“Blue Star,” the “Company,” “we,” “our” or
“us”) (NASDAQ:
BSFC), an
integrated Environmental, Social, and Governance (ESG) sustainable
seafood company with a focus on Recirculatory Aquaculture Systems
(RAS), today announced financial and operational results for the
three and six months ended June 30, 2022.
Key Financial Highlights for the
Three Months Ended June 30, 2022 Compared
to the Same Three Month
Period in 2021.
- Revenue increased 39% to $3.0
million
- Soft-shell crab RAS revenue
increased to $0.5 million, from $0
- Net loss increased 229% to $1.4
million
- Adjusted EBITDA loss increased to
$1.0 million
- Cash balance at $2.6 million ($1.2
million at December 31, 2021)
- Inventory of $5.7 million ($2.1
million at December 31, 2021)
- Total assets increased 29% to $20.6
million ($16.0 million at December 31, 2021)
Key Financial Highlights for
the Six Months
Ended June
30,
2022 Compared to
the Same Six Month
Period in
2021.
- Revenue increased 79% to $8.3 million
- Net loss increased 172% to $2.5 million
- Adjusted EBITDA loss increased to $1.3 million
Business Highlights for the
Three Months Ended June
30,
2022
- Selected for inclusion in the
Russell Microcap® Index
- Selected HTH Engineering &
Equipment LLC as its the RAS technology provider for its planned
expanded Soft-Shell Atlantic Crab RAS farm in Jasper County, South
Carolina
- Taste of BC Aquafarms, Inc. a
subsidiary of Blue Star, hatched its first batch of Chinook Salmon,
as part of its process to explore potential future species
diversification within the Pacific Salmon family
- Appointed Miozotis Ponce as Chief
Operating Officer
- Appointed Silvia Alana and Juan
Carlos Dalto to the Board of Directors
Management Commentary
John Keeler, Chairman and CEO of Blue Star,
commented, “We continued our positive momentum during the second
quarter and we believe remain on track to nearly double revenue for
all of 2022, as compared to the $10.0 million revenue we generated
in all of 2021. We launched our soft-shell crab RAS operations in
March 2022, as we utilize technology to enhance productivity and
sustainability. We are very pleased with the early results and $0.5
million revenue contribution in the second quarter, as we look for
its pending expansion to be a major differentiator for us and
contributor to profitability. Initial response from our seafood
distributors and customers has been favorable in validating our
sustainable indoor fish farming technology and processes.”
Mr. Keeler continued, “In this second quarter,
we ramped our investment in our RAS divisions to position us for
expansion in the second half of the year and into 2023. Without
such incremental investment and our non-cash expenses, our
operating profitability would have been similar to previous
quarters. We are excited with our multi-phase engineering contract
with HTH to provide planning, design and consulting services to
create a new facility that, when fully built, will be able to
harvest over 220,000 dozen a year of Soft-Shell Atlantic Blue Crab.
The new operation will be in Jasper County, South Carolina,
replacing the existing facility in Beaufort County, South
Carolina.”
Mr. Keeler concluded, “As we look to the second
half of 2022, we believe we remain on track to restore our legacy
business to pre-pandemic levels of approximately $20 million of
annual revenue. Our team is focused on advancing into the
construction phase of our transformational soft-shell crab RAS
facility in Jasper County, South Carolina. We believe that the
Company is poised to successfully deliver on its mission statement
of providing safe, secure and sustainable local source farm-raised
seafood species. We look forward to providing updates on our
progress.”
Current Project Timeline
for Soft-Shell Crab RAS Facility in Jasper County, South
Carolina
- In detail engineering phase
- Construction expected to start by the
end of September 2022
- Start RAS installation by the end of
December 2022
- Commissioning by the end of March
2023
- Commence operations in the second
quarter of 2023
- 1st commercial harvest in the third
quarter of 2023
Positive Operating
Performance Metrics for First Half of 2022
at Taste of BC Aquafarms,
Inc. Blue Star made a significant investment to build up
the raw material and biomass inventory at Taste of BC Aquafarms in
British Columbia that it is expected to be sold over the remainder
of 2022. At the end of the second quarter, the Company had standing
biomass of 40 metric tons (MT) in its facility, which was
originally designed for 27MT. This expansion was a major success
without compromising water conditions or fish performance.
Average Fish Harvest Weight
- In the six months ending June 30,
2021, the Company’s average fish harvest weight has been 1.94kg.
The Company targets a minimum weight of 2kg for its Steelhead
Salmon product.
Average Harvest Downgrade Percentage
- In the six months ending June 30,
2021, the total harvest downgrade percentage was 1.3%. This metric
measures the number of fish at harvest that we did not bring to
market at full price in the last stage of the lifecycle.
Average Feed Conversion Ratio In the six months
ending June 30, 2021, we have achieved a feed conversion ratio
(FCR) of 1.18KG Feed/Kg.Financial Results for
the Three Months Ended
June 30,
2022
- Revenue for the three months ended
June 30, 2022, increased by $0.9 million, or 39.0%, to $3.0 million
compared to $2.1 million for the three months ended June 30, 2021,
as a result of higher market prices of our product together with
sales of our new Taste of BC Aquafarms and soft-shell crab
operations, which contributed $0.5 million revenue.
- Gross profit for the three months
ended June 30, 2022 decreased by $0.3 million, or 41% to $0.3
million compared to $0.6 million in the three months ended June 30,
2021. This decrease is attributable to higher market prices and
higher cost of goods sold. The corresponding gross margin for the
three months ended June 30, 2022, decreased to 11.4% compared to
26.8% for the three months ended June 30, 2021. This decrease is
attributable to cost of goods inflation and rapid LTL freight fuel
surcharges. Over the long-term, we hope to pass this on through
higher wholesale prices..
- Operating loss for the three months
ended June 30, 2022, increased by $0.8 million, or 208%, to $1.1
million, compared to $0.4 million for the three months ended June
30, 2021. The increase in operating expenses for the three months
ended June 30, 2022 was attributable to increases in salaries for
existing and new employees, acquisition costs and costs for our
softshell crab operations. Of note, operating loss for the three
months ended June 30, 2022, included non-cash or one-time
non-recurring operating expenses totaling $0.4 million, comprised
of non-cash items of $0.1 million in depreciation and amortization
and $0.3 million in stock compensation.
- Net loss for the three months ended
June 30, 2022, increased by $1.0 million, or 229% to $1.4 million,
compared to $0.4 million for the three months ended June 30, 2021.
The increase in net loss is primarily attributable to increases in
salaries and wages and other expenses in connection with the
acquisition of the soft-shell crab operations and amortization of
Lind convertible debt discount. The EPS loss per share for the
three months ended June 30, 2022 was ($0.06), compared to ($0.02)
for the three months ended June 30, 2021.
- Adjusted EBITDA loss for the three
months ended June 30, 2022was $1.0 million compared to $0 for the
three months ended June 30, 2021.
- As of June 30, 2022, Blue Star had
approximately $2.6 million in cash, compared to $3.0 million on
March 31, 2022.
Financial Results for the Six
Months Ended June 30, 2022
- Revenue for the six months ended
June 30, 2022 increased by $3.7 million, or 79%, to $8.3 million
compared to $4.6 million for the six months ended June 30, 2021 as
a result of higher market prices of our product together with sales
of our new TOBC Aquafarms and soft-shell crab operations, which
contributed $0.5 million revenue.
- Gross profit for the six months
ended June 30, 2022 decreased by less than $50,000, or 5%, to $0.8
million compared to $0.9 million in the six months ended June 30,
2021. The corresponding gross margin for the six months ended June
30, 2022, decreased to 10.0% compared to 18.9% for the six months
ended June 30, 2021.
- Operating loss for the six months
ended June 30, 2022, increased by $1.2 million, or 144%, to $2.0
million, compared to $0.8 million for the six months ended June 30,
2021. Of note, operating loss for the six months ended June 30,
2022, included non-cash or one-time non-recurring operating
expenses totaling $1.0 million, comprised of non-cash items of $0.3
million in depreciation and amortization and $0.6 million in stock
compensation and one-time non-recurring operating expenses totaling
$0.1 million associated with legal and professional fees in the
Gault Seafood asset acquisition.
- Net loss for the six months ended
June 30, 2022, increased by $1.6 million, or 172% to $2.5 million,
compared to $0.9 million for the six months ended June 30, 2021.
The EPS loss per share for the six months ended June 30, 2022 was
($0.10), compared to ($0.05) for the six months ended June 30,
2021.
- Adjusted EBITDA loss for the six
months ended June 30, 2022, increased by $1.2million, to $1.3
million, compared to $0.1 million for the six months ended June 30,
2021.
About Blue Star Foods Corp. (NASDAQ:
BSFC)Blue Star Foods Corp. is an integrated ESG seafood
company that processes, packages and sells high-value seafood
products. The Company believes it utilizes best-in-class
technology, in both resource sustainability management and
traceability, and ecological packaging. The Company also owns and
operates the oldest continuously operating Recirculating
Aquaculture System (RAS) full grow-out salmon farm in North
America. The Company is based in Miami, Florida, and its corporate
website is: https://bluestarfoods.com
Forward-Looking Statements:
The foregoing material may contain
“forward-looking statements” within the meaning of Section 27A of
the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934, each as amended. Forward-looking statements
include all statements that do not relate solely to historical or
current facts, including without limitation statements regarding
the Company’s product development and business prospects, and can
be identified by the use of words such as “may,” “will,” “expect,”
“project,” “estimate,” “anticipate,” “plan,” “believe,”
“potential,” “should,” “continue” or the negative versions of those
words or other comparable words. Forward-looking statements are not
guarantees of future actions or performance. These forward-looking
statements are based on information currently available to the
Company and its current plans or expectations and are subject to a
number of risks and uncertainties that could significantly affect
current plans. Risks concerning the Company’s business are
described in detail in the Company’s Annual Report on Form 10-K for
the year ended December 31, 2021, and other periodic and current
reports filed with the Securities and Exchange Commission. The
Company is under no obligation to, and expressly disclaims any such
obligation to, update or alter its forward-looking statements,
whether as a result of new information, future events or
otherwise.
Investor Contacts:Investors@bluestarfoods.com
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