Benchmark Holdings’ recent Q3 (March-June) results show strong revenue and profit growth in its Nutrition and Genetics divisions, driven by a recovery in the end-markets for salmon and shrimp from the lockdown-affected levels of the past year. Attention is, however, largely focussed on the new Ectosan®Vet sea lice treatment, which saw its commercial launch just after the period end in August.
Q3 results: Nutrition revenues rose by 15% driven by Artemia (+21%) and diets (+27%), while Genetics revenues increased by 21%, with 5% growth in the important salmon eggs segment. Underlying profit contribution (AEBITDA) was up strongly in Nutrition (+65%) as well as Genetics, excluding fair value adjustments in biological assets (+37%). Group sales and AEBITDA were up 15% at £28.4m and by 110% at £4.4m respectively.
Ectosan®Vet launch in August: Benchmark management remains outwardly confident about Ectosan®Vet/CleanTreat prospects following the launch in August. The first vessel is fully booked out and a second vessel is due to come on stream imminently. The new business is, however, likely only to make a modest contribution in the fourth quarter.
We have revised our financial model to reflect a more conservative trajectory for the new business based on current information and expectations. However, this was offset by other changes so the net effect on our Fair Value was negligible which remains at £550m or 82p/share.
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