Omega Protein processing plant in Reedville, Virginia. (Photo: StockFile)
Omega Protein’s revenue drops in Q3
Friday, November 10, 2017, 01:40 (GMT + 9)
Nutritional product company Omega Protein Corporation reported a 17 per cent drop in revenues in the third quarter, to USD 90.3 million. This result reflects a decline in animal nutrition revenues, which was partially offset by higher income in the human nutrition sector.
The firm informed a decrease in sales volumes of 21 per cent and 20 per cent for the Company's fish oil and fishmeal, respectively, accompanied by decreased sales prices of 5 per cent and 8 per cent, respectively.
Omega Protein explains these lower sales volumes were due to lower production caused by lower fish catch and total yield and the decreased level of beginning inventory. They were also influenced by the global market condition when signing the contracts.
The firm’s adjusted EBITDA totalled USD 9.7 million for the third quarter, compared to USD 29.4 million for the same period last year and USD 18.5 million for the second quarter of 2017.
Meanwhile, in the first nine months this year, Omega Protein’s revenue experienced a 16 per cent decline, to USD 257.8 million compared to USD 306.2 million for the nine months ended September, 2016. The firm attributes the drop to a USD 54.4 million decrease in animal nutrition revenues caused by drops in sales volume and value of fish oil and fishmeal.
For the analysed nine-month period, the firm’s adjusted EBITDA totalled USD 43.4 million compared to USD 78.5 million for the same period last year.
In October this year, Omega Protein and Cooke Inc., a New Brunswick company and parent of Cooke Aquaculture Inc., announced that they have entered into a definitive agreement under which Cooke will acquire all outstanding shares of Omega Protein for USD 22.00 per share in cash.
The transaction - which is expected to close near the end of 2017 or early in 2018 - is subject to the approval of Omega Protein stockholders, certain regulatory approvals and other customary closing conditions.