Blue Star Foods Reports Growth of 28% to $10.7 Million Revenue for the Nine Months Ended September 30, 2022
November 15 2022 - 8:30AM
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”), announced financial and operational
results for the three and nine months ended September 30, 2022.
Key Financial Highlights for the
Three Months Ended
September 30, 2022
- Revenue of $2.4 million
- Soft-shell crab RAS revenue increased to $0.5 million
- Net loss of $3.7 million (included $1.6 million of non-cash or
one-time non-recurring expenses)
- Adjusted EBITDA loss increased to $1.3 million
- Inventory of $6.1 million ($2.1 million at December 31,
2021)
- Total assets of $16.8 million ($16.0 million at December 31,
2021)
Key Financial Highlights for the Nine Months Ended
September 30, 2022
- Revenue increased 28% to $10.7 million
- Soft-shell crab RAS revenue increased to $1.0 million
- Net loss of $6.2 million (included $3.0 million of non-cash or
one-time non-recurring expenses)
- Adjusted EBITDA loss of $2.6 million
Business Highlights for the Three
Months Ended September 30, 2022
- Extended multi-year supply relationship with Avendra LLC
- Extended multi-year supply relationship with Sysco
Management Commentary
John Keeler, Chairman and CEO of Blue Star,
commented, “Our top-line revenue has continued as expected and
we believe we remain on track to nearly double revenue for all of
2022, with our $10.7 million revenue year-to-date and $6.1 million
of inventory that we hope to convert to revenue over the next four
months, as compared to the $10 million revenue we generated in all
of 2021. Our soft-shell crab RAS operations commenced in March 2022
and we are pleased with the early results and $1.0 million revenue
contribution over the past two quarters. Our third quarter loss
typically occurs due to front loading discounting for contract
retention, that we believe will benefit future quarter earnings and
profits. Additionally, we spent approximately $0.5 million in
engineering designs related to our new planned RAS facility in
South Carolina.”
We strongly believe our planned RAS expansion
will be a major differentiator for us and contributor to accelerate
revenue growth and profitability. Our incremental investment in our
sustainable indoor fish farming technology and processes continues
to ramp as we position for our new operations in South Carolina, to
replace our existing facility in South Carolina. When fully built,
will anticipate being able to harvest over 220,000 dozen soft-shell
Atlantic Blue Crab a year.”
Mr. Keeler concluded, “As we look toward the end
2022 and into 2023, we believe we remain on track to restore our
legacy business to pre-pandemic levels of approximately $20 million
of annual revenue and advance the construction phase of our
transformational soft-shell crab RAS facility, with a target of our
first commercial harvest in the fourth quarter of 2023.. We look
forward to providing updates on our progress.”
Current Project Timeline
for Soft-Shell Crab RAS Facility;
- Currently in detail engineering phase
to conclude 4th Quarter 2022
- Construction expected to start 1st
Quarter 2023
- Start RAS installation by 2nd Quarter
2023
- Commissioning by the end 3rd Quarter
2023
- Commence operations early 4th Quarter
2023
- 1st commercial harvest by the end 4th
quarter 2023
Financial Results for the Three
Months Ended September
30, 2022
- Revenue for the three months ended
September 30, 2022, decreased by $1.3 million, or 35%, to $2.4
million compared to $3.7 million for the three months ended
September 30, 2021. The decrease in revenue was primarily
attributable to lower sales prices due to discounting for customer
contract retention.
- Gross loss for the three months
ended September 30, 2022 was $1.5 million compared to gross profit
of $0.7 million in the three months ended September 30, 2021. This
increase in losses is attributable to front loading discounting for
contract retention and an inventory adjustment of $0.5
million.
- Operating loss for the three months
ended September 30, 2022, increased by $2.9 million, to $3.4
million, compared to $0.5 million for the three months ended
September 30, 2021. The increase in operating loss was attributable
to lower gross profits, increased RAS engineering and
pre-construction project costs for the planned RAS soft shell crab
facility, salmon hatchery expansion and impairment loss from an
inventory adjustment. Operating loss for the three months ended
September 30, 2022 included non-cash or one-time non-recurring
operating expenses of $1.6 million, comprised of non-cash items of
$0.4 million in depreciation and amortization, $0.7 million
impairment of goodwill and $0.5 million in inventory
adjustment.
- Net loss for the three months ended
September 30, 2022, increased by $3.5 million, to $3.7 million,
compared to $0.2 million for the three months ended September 30,
2021. The increase in net loss is primarily attributable to front
loading discounting for contract retention and increased RAS
engineering costs for both the salmon and soft shell crab RAS
expansions.
- Adjusted EBITDA loss for the three
months ended September 30, 2022 was $1.8 million compared to $0.3
million for the three months ended September 30, 2021.
Financial Results for the Nine
Months Ended September
30, 2022
- Revenue for the nine months ended
September 30, 2022 increased by $2.4 million, or 28%, to $10.7
million compared to $8.3 million for the nine months ended
September 30, 2021 as a result of sales of our salmon aquafarms and
soft-shell crab operations.
- Gross loss for the nine months
ended September 30, 2022 was $0.7 million compared to gross profit
of $1.5 million for the nine months ended September 30, 2021. The
corresponding gross margin was a negative 6.7% for the nine months
ended September 30, 2022 compared to a positive 18.5% for the nine
months ended September 30, 2021.
- Operating loss for the nine months
ended September 30, 2022, increased by $4.0 million, to $5.3
million, compared to $1.3 million for the nine months ended
September 30, 2021. Operating loss for the nine months ended
September 30, 2022 included non-cash or one-time non-recurring
operating expenses of $3.0 million, comprised of non-cash items of
$1.1 million in depreciation and amortization, $0.7 million
impairment of goodwill, $0.5 million in inventory adjustment and
$0.7 million in stock-based compensation.
- Net loss for the nine months ended
September 30, 2022, increased by $5.2 million to $6.2 million,
compared to $1.1 million for the nine months ended September 30,
2021
- Adjusted EBITDA loss for the nine
months ended September 30, 2022, increased by $1.9 million, to $2.3
million, compared to $0.4 million for the nine months ended
September 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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