Asset sell-off pushed AquaBounty losses up to $149.2m last year
Land-based salmon farmer AquaBounty’s attempts to raise cash for its survival by selling off its assets pushed its net losses up from US $27.6 million in 2023 to $149.2m last year.
Included in the loss for 2024 were asset impairment charges of $129.8m related to the company’s Indiana farm, Canadian farms, Ohio equipment assets, Ohio farm construction site, and corporate intellectual property (IP).
As of December 31, 2024, AquaBounty had cash, cash equivalents and restricted cash of $230,000, compared to $9.2m on the same date in 2023.
Selling assets
“AquaBounty entered 2024 with the goal of raising new funds to allow for the recommencement of construction activities at our Ohio farm site, but ultimately our efforts were unsuccessful,” said interim chief executive David Frank in a market announcement.
“We therefore had to pivot our focus to selling non-core assets to generate liquidity. We completed the sale of our Indiana farm in July, and we sold various Ohio equipment assets throughout the balance of the year. However, these efforts did not generate enough cash to maintain our operating facilities, and thus we had no alternative but to close down our remaining Canadian farms operations in December and reduce our staff.
“As stated in our previous announcement, we plan to continue to work with our investment banker to assess strategic alternatives for our Ohio farm project, and we will continue to market and sell available Ohio equipment assets to generate cash.”
$2.2m from auction
Frank, who is also AquaBounty’s chief financial officer, said an auction in February of some equipment purchased for the Ohio farm project raised net proceeds of $2.2m.
AquaBounty’s Canadian hatcheries, and the corporate IP for its AquAdvantage salmon that inherit a genetic modification that speeds their growth, were sold to conventional salmon farmer Cooke Aquaculture on March 3. Cooke pointed out that it does not farm or sell any GM seafood products and has no plans to do so with this acquisition.
The assets bought by Cooke included a series of four buildings on Prince Edward Island including a hatchery facility with modern egg incubation and a high-tech laboratory in Bay Fortune, and another modern hatchery facility, a new large modern recirculating aquaculture facility (RAS) facility, and a second unfinished building intended to house another large RAS unit, in Rollo Bay. Cooke intends to complete the construction.
Alternatives for Ohio site
AquaBounty netted $1.9m from the sale, after deducting commissions, fees and the assumption of $3.2m in outstanding loans,” said Frank.
“These transactions have provided us with the liquidity to continue to pursue strategic alternatives for our Ohio farm project,” he added. “We will continue to keep all stakeholders apprised of our progress.”
According to its 2024 annual report published today, AquaBounty commenced construction on the Ohio farm site and began ordering equipment in the first quarter of 2022. It spent roughly $145m on the project before construction was halted in June 2023, due to increases in costs from inflation and other factors. At the time of the construction stoppage, roughly 30% of the facility had been completed.
Joint ventures
“We have been working with our investment bank on strategic alternatives for the Ohio farm site, including new investment to allow for the completion of the Ohio farm project construction,” wrote AquaBounty.
“Alternatives include new equity funding, partnerships or joint ventures. We believe that funding of roughly $400m will be required to complete the construction and replace the Ohio equipment assets that have been sold.
“This figure, however, is based on the current design and expected use of the facility as a salmon grow-out farm. Depending on the strategic alternative that we follow, the design (smaller or larger production volume) and use of the farm (salmon or other species) could be changed, which could result in a different cost of completion number.”