In the first half year, the Company achieved record production of 932 tons net growth.

The Kingfish Company Reports Higher Revenue for Half Year Ended June 30, 2023

The Kingfish Company N.V. (OSE: KING), pioneer and leader in sustainable land-based production of yellowtail kingfish, has announced its Q2 and H1 2023 financial results.

“Our financial results for the first half of 2023 are marked by key progress in operations and in strengthening our balance sheet. We have laid out a solid foundation to accelerate growth and reach profitability. In the second half of the year, we will complete the Phase 2 expansion in the Netherlands, continue our efforts to improve our operational performance, and increase sales volume”, said Vincent Erenst, CEO of The Kingfish Company.

Financial review

Vincent Erenst.

In H1 2023, revenue increased 31% to € 11.2 million (H1 2022: € 8.4 million). Revenue per kg was € 15.1 (H1 2022: € 12.0 per kg). Total volume sold amounted to 740 tons, an increase of 5%. The demand for Dutch Yellowtail, particularly fresh large size fish, continues to surpass the available supply.

In the first half year, the Company achieved record production of 932 tons net growth (H1 2022: 742 tons). This has resulted in sector leading productivity of 0.90 kg net growth per installed cubic meter per day and eFCR for the period of 1.30 compared to 1.49 in H1 2022. Operations at Kingfish started more than five years ago and the 58th cycle was in production at the end of June 2023.

Gross margin increased 50% to € 1.5 million (H1 2022: € 1.0 million), or to 13.9% of revenue (H1 2022: 12.1%), despite significantly higher input costs. Increased feed prices have been partially offset by an improved biological performance and the introduction of new feed formulations. Energy costs, which peaked in H2 2022, were lower in H1 2023 as we benefitted from a favorable contract. Overall, the increased sales prices offset the higher input costs leading to an increase in gross margin to € 2.1 per kg (H1 2022: € 1.5 per kg).

In the first half of 2023, operational EBITDA amounted to € -2.2 million (H1 2022: € -2.2 million). EBITDA per kg was € -3.0 (H1 2022: € -3.1 per kg). SG&A costs increased year-on-year by 19% mainly related to one-off transformation related costs to strengthen the organization and to anticipate the additional volume as of Q1 2024.

The net loss after tax in the first half of 2023 was € -4.2 million (H1 2022: € -2.8 million), driven mainly by higher financial expenses.

1- Figures are unaudited.

Capital expenditure

The Group spent € 16.1 million in capital expenditure during the first half of 2023, including € 1.3 million farm and US growth capex. Operations in Phase 2 started in May, with 60% of the grow-out systems operational as of end of August. Growth and performance have been outstanding. The farm biomass is expected to more than double before year-end, compared to Phase 1 steady-state level.

Cash flow

The Company reported € -2.2 million (H1 2022: € -1.5 million) of operating cash flow in the first half of the year. The difference is mainly driven by a reduction in capex payable and an increase in biomass after the start-up of the Phase 2 grow-out systems.

Net debt on June 30, 2023, amounted to € 60.4 million (€ 54.8 million at December 31, 2022), an increase of € 5.6 million compared to December 31, 2022.

The Kingfish Company is focused on high quality production with the lowest environmental impact.

Financing

At the start of July 2023, the Company successfully raised € 32 million by way of a convertible loan with a fixed interest rate and a duration of 4 years. By mid-August, the total amount had been received by the Company. The convertible loan and the other remaining facilities from PCP and Rabobank provide full funding for the completion of the Phase 2 expansion and the period until the Company reaches positive cash flow and profitability.

Outlook

Management remains positive about the outlook for The Kingfish Company. With financing secured for the completion of Phase 2 and a clear path to profitability, the company can focus fully on growing the business and optimizing operations.

The Kingfish Company is a first mover operating at the cutting edge of sustainable, land based, high value marine aquaculture in the EU and the US.

The Group capacity will more than double after the new extension of the farm in the Netherlands is fully commissioned, enabling the company to meet the growing demand for high-quality Dutch Yellowtail. The Company expects to benefit from the scaling effect and further improvement in operations and productivity to become profitable and cash positive. Where the current focus is on completion of the Zeeland project, management continues to develop expansion plans in the US and Europe.

About The Kingfish Company

With an optimally located site on the shores of the Oosterschelde marine nature reserve in the Netherlands servicing the EU market daily, full cycle hatchery, an on site R&D facility, and an advanced grow-out system; and a 2nd site in development in Jonesport Maine for the US market, The Kingfish Company N.V. is a first mover operating at the cutting edge of sustainable, land based, high value marine aquaculture in the EU and the US.

Source: Kingfish Company

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Address:	Oost-Zeedijk 13
City:	Kats
State/ZIP:	(4485 PM)
Country:	Netherlands
Phone:	+31 (0) 113 74 54 61
E-Mail:	[email protected]
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