Ocean Harvest Technology (OHT) , a producer of animal feed supplements from seaweed blends, announced unaudited results for the 6 months ended June 30 2023 (H1 2023).

Ocean Harvest completed its IPO during the period, raising gross proceeds of £6.0m. The company saw revenues rise 66% to €1.6m from €0.95m in H1 2022. Gross margin jumped 150% to €0.56m and 36% from 24% last year. Period-end cash balance was €4.8m.

Operationally, the company won 10 new customers in the first 6 months of the year, including a "top five" swine producer in the US and one of the UK's largest feed pre-mixers. Ocean Harvest also expanded its seaweed supply chain to new regions such as East Africa and the  Philippines, giving it access to materially larger volumes of biomass.

During the period, life cycle analysis of Ocean Harvest's OceanFeed line of products revealed that it has a significantly lower CO2 eq footprint in its manufacture than other common ingredients in animal feed. OceanFeed can therefore be a CO2 net negative, as 1 tonne used as an additive can reduce CO2 eq emissions from the feed chain by over 10 tonnes.

Furthermore, recent R&D trials demonstrated OceanFeed's efficacy in improving animal performance across a range of species.

Mark Williams, CEO, commented: "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."

 

View from Vox

A positive set of interim results from Ocean Harvest Technology, with 66% higher revenues and 150% higher gross margin during the half. OHT's strong momentum carries into H2 as it continues to win new customers and grow its pipeline of customer trials.

The improvement in gross margin achieved year-to-date is expected to continue in H2 thanks to revised selling price levels and Ocean Harvest's developments in seaweed sourcing and processing. During the period, OHT secured a key partnership with a producer of brown seaweed, providing price and volume certainty of supply, and is progressing similar arrangements with other seaweed suppliers.

The outlook for Ocean Technology's supply of seaweed therefore remains positive and supportive of continued growth. While sales in Asia and the Americas were strong, OHT saw some issues with sales in Europe due to high feed ingredient prices and businesses being accustomed to using other additives. Ocean Harvest expects to offset this in H2 by volume from a recently acquired large customer in another region, which is expected to significantly up orders.

Ocean Harvest said it expects total revenue for the year to come in at €3.4m. The company remains well-funded with no external debt and a cash balance at period-end of €4.8m. Despite some difficulty in Europe, the company maintains strong visibility over FY24, and we expect its revenues to continue their upward trajectory as demand for sustainable and natural animal feeds increase in line with net zero targets.

 

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