Ocean Harvest Technology Group Plc has announced its unaudited interim results for the six-month period ending June 30, 2023. The company successfully completed its initial public offering, raising £6 million, which will allow it to focus on its strategic growth objectives. The company saw a 66% growth in product revenue to €1.6 million, with a 150% increase in gross margin to €0.56 million. This increase in gross margin was driven by higher average selling prices, the elimination of selling concessions post-Covid-19, and an improvement in processing yield. The company is well-funded with no external debt and a cash balance of €4.8 million.
In terms of operational highlights, Ocean Harvest Technology Group onboarded over 10 new customers in the first six months, including a top five swine producer in the US and one of the UK's largest feed pre-mixers. The company also expanded its seaweed supply chain in new regions such as East Africa and the Philippines, giving access to larger volumes of biomass. It has secured a strategic relationship with a producer of brown seaweed, providing price and volume certainty of supply, and is working on similar arrangements with other seaweed suppliers. The company has also invested in an additional grinding line in Vietnam, increasing yield significantly.
Ocean Harvest Technology Group completed a Life Cycle Analysis of its product, OceanFeedTM, which demonstrated a lower CO2 equivalent footprint in its manufacture compared to other common ingredients in animal feed. The company also completed further R&D trials that showed the strong efficacy of OceanFeedTM in various applications. It was awarded a patent that protects the claim that the use of a seaweed blend as a feed supplement improves the quantity and/or quality of eggs produced by egg-laying birds.
Looking ahead, the company expects to continue onboarding new customers and achieve further improvements in gross margin due to revised selling price levels and developments in seaweed sourcing and processing. The outlook for seaweed supply remains strong, supporting continued growth in product sales. However, the company is experiencing some delays in onboarding new customers in Europe due to feed ingredient prices affecting customer profitability and entrenched usage of other additives. The strengthening of the Euro in 2023 will also impact reported revenue, which is primarily sourced in US dollars. As a result, the company expects to report total revenue for the year in excess of €3.4 million.
CEO Mark Williams stated, "At our maiden set of interim results, I am pleased to say that OHT has begun to deliver on its objectives set out at its IPO in April. We are continuing to strengthen our global sales team and build out our supply chain. We will also continue to invest in R&D to innovate and enhance our existing customer offering in the markets the Group operates in. We will continue to manage some of the short-term onboarding delays and we look forward to delivering on our long-term growth strategy for our new and existing shareholders."