The directives of the integrated Environmental, Social, and Governance (ESG) sustainable seafood company Blue Star Foods, based in Doral, Florida, United States (US,) announced their plans to open a new plant dedicated on soft-shell crab production in South Carolina. The details were reported in the presentation of the financial and operational results for the three and six months ended on last June 30.
“We are excited with our multi-phase engineering contract with HTH to provide planning, design and consulting services to create a new facility that, when fully built, will be able to harvest over 220,000 dozen a year of Soft-Shell Atlantic Blue Crab. The new operation will be in Jasper County, South Carolina, replacing the existing facility in Beaufort County, in the same state,” commented John Keeler, Chairman and CEO of Blue Star.
According to him, the company continued the “positive momentum” during the second quarter and the directives believe remain on track to nearly double revenue for all of 2022, as compared to the USD 10 million revenue they generated in all of 2021.
In the second quarter, “we ramped our investment in our RAS divisions to position us for expansion in the second half of the year and into 2023. Without such incremental investment and our non-cash expenses, our operating profitability would have been similar to previous quarters,” Keeler explained.
Expansion will be a major differentiator
Blue Star Foods launched its soft-shell crab RAS operations in March 2022, as they utilize technology to enhance productivity and sustainability.
“We are very pleased with the early results and USD 0.5 million revenue contribution in the second quarter, as we look for its pending expansion to be a major differentiator for us and contributor to profitability. Initial response from our seafood distributors and customers has been favorable in validating our sustainable indoor fish farming technology and processes,” he expressed.
“Our team is focused on advancing into the construction phase of our transformational soft-shell crab RAS facility in Jasper County, South Carolina. We believe that the Company is poised to successfully deliver on its mission statement of providing safe, secure and sustainable local source farm-raised seafood species. We look forward to providing updates on our progress,” he said.
Restore business to pre-pandemic levels
In his report, Keeler assured: “As we look to the second half of 2022, we believe we remain on track to restore our legacy business to pre-pandemic levels of approximately USD 20 million of annual revenue.”
Compared to the same period in 2021, the three months ended on June 30, 2022, Blue Star achieved a revenue increased 39% to USD 3.0 million; and soft-shell crab RAS revenue increased to USD 0.5 million, from zero.
Meanwhile, the net loss increased 229% to USD 1.4 million; adjusted EBITDA loss increased to USD 1.0 million and cash balance at USD 2.6 million. The total assets increased 29% to USD 20.6 million.
Nevertheless, Blue Star’s gross profit for the quarter fall 41% to USD 300,000. “This decrease is attributable to higher market prices and higher cost of goods sold,” the report said. Its corresponding gross margin declined to 11.4%, compared to 26.8% for the same quarter of 2021.
High-value seafood products
Blue Star Foods 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.