Hofseth BioCare. Financial Update Q2 2014

Transcription

1 Hofseth BioCare Financial Update Q2 214

2 Highlights Highlights in the second quarter HBC raised NOK 9 million through a private placement of 2 million new shares Notice of Allowance from the Japanese Patent office for our Iron Absorption patent Events after the quarter HBC opens a sales office in Chicago, USA Delivers fresh salmon oil capsules ND exclusivity agreement to a Finnish customer Received confirmation on listing of Salmon oil at ICA under HBCs own brand BioSalmaFresh Ole Arne Eiksund is appointed as new VP Global Sales, Karen Marie M. Hovland as Project Manager and Kai Morten Thuen as Marketing Manager HBC revealed a damage to the steam boiler, resulted in immediate stop in production and notice of temporarily layoffs of some employees at the plant on Midsund and Berkåk

3 Human Nutrition Business drivers Growing world population Billion people Year e Rising healthcare costs in U.S. +164% , 4 564, 2 412, 6 657, Increased standard of living 6 2, 23 Employer contribution 213 Worker contribution 2, 2 21 Developing Countries GDP per Capita (USD) Aging 21, 1, 1,8 Interest in preventative health & awareness of nutritional benefits 2, 32, 36, e U.S. Supplement Sales (USB) U.S. population over 6 References: OmegaProtein Corp, Kaiser/HRET Survey of Employer-Sponsored Health Benefits, ; World Population World Bank, Standards of Living World Bank, 211

4 The Protein Market Explosion Protein is not only for body building $ 1 BILLION Global Protein market value $ 3.4 BILLION US Sports Protein powders $ 1.4 BILLION US Whey Protein alone WHEY CASEIN MILK SOY EGG RICE PEA While milk-based sources (Whey, Casein and Milk) still dominate, consumers are getting more and more protein from other sources 25% 37% Men Women VS Weight loss and management Boost immunity and transport of nutrients 9% Body Building Appetite Suppressant Increasing use of proteins for both men and women 15% 4% IN A SURVEY IN THE US OF 3,6 ADULTS, 4% SAID THAT THEY WERE INTERESTED IN ADDING PROTEIN TO THEIR DIET Protein used as a supplement for sports nutrition (taken 3x a week or more) Protein supplement used as a meal replacement (3x a week or more) References: UBIC Consulting, 214, Nutrition Business Journal Consumer Sales Estimates 213, New Hope Natural Media s NEXT trend data , Global Functional Food Survet Trends and Insight Candean

5 Production update Raw Material (MT) HBC processed 2,4 tons of raw material during Q2 compared to 1,45 tons in Q1 Supply of raw material during Q2 has been satisfactory Completed installation of a salt-water scrubber in June to clean process air Stop in production from August to November due to damaged steam boiler Q1 Q2 Q3 Q Accumulated 214 5

6 Salmon oil production Salmon oil (MT) 439,9 18,5 % 18, % 17,5 % 17, % During Q2, HBC produced 44 tons of salmon oil compared to 233 tons in 1Q 214 Salmon oil is stored for future shipments Significant order to UK in June ,5 % , % Q1 Q2 Q3 Q Yield (%) 15,5 % 6

7 Soluble Protein production Soluble Protein (MT) 96,2 4,1 % 4, % 4, % 3,9 % 3,9 % HBC produced 96 tons of soluble proteins (SPH) compared to 54 tons in Q1 High quality in production and several test blends for finished products ongoing Actions taken to improve yield on the human quality protein 2 3,8 % Q1 Q2 Q3 Q Yield (%) 3,8 % 7

8 Marine calcium production 8 7 Calcium (MT) 74,3 3,1 % 3,1 % During Q2, HBC produced 74 tons of calcium compared to 42 tons in Q ,1 % 3,1 % 3, % 3, % 3, % 3, % 3, % New filter technology installed in 213 works excellent, and the bone separation process works as designed Starting adjustments on drying and milling process during the fall 1 2,9 % Q1 Q2 Q3 Q Yield (%) 2,9 % 8

9 NOK million NOK million NOK million NOK million Financials Operating revenues in Q2 214 of MNOK 7.4 and EBITDA of MNOK 5.4 Significant reduction in cost base. Cash expected to increase in Q3 and Q ,5 7,9-1,7 25,5-3,6-21,2 Q1 213 Q2 213 Q3 213 Q4 213 Q1 214 Q2 214 Operating revenues EBITDA Lineær (EBITDA) 28,2 1,6-8,1 7,4-5, , ,3 7,7 3, ,9 48,4 52,4 118,8 Q1 212 Q2 212 Q3 212 Q4 212 Q1 213 Q2 213 Total asets Total equity Equity ratio (%) ,6 78,9 88,5 92,5 98,6 84,5 4,5 4, 3,5 3, 2,5 4,2 3,5 3,9 3, , 1,5 1,,5 1,4,9 Q1 213 Q2 213 Q3 213 Q4 213 Q1 214 Q2 214, Q1 213 Q2 213 Q3 213 Q4 213 Q1 214 Q2 214 Interest-bearing liabilities Cash and cash equivalents

10 R&D Biocat Enzyme Substitution for reducing cost of hydrolysis Use of Lipase Enzymes to increase PUFA content in our Salmon oil Use of ultrafiltration to improve organoleptic performance of SPH Expanding the diagnostic assay for OmeGo to the more commonly available and easily tested oxldl biomarker Publication/Patent preparation on processing difference with OmeGo and Bioactivity TIM-1 study in the Journal of Functional Foods in Health and Disease Fractionating SPH at NSRL for Pharma leads New fermentation suitability experiments to prepare a new sell sheet and publication Initiated the Herring Hydrolysis project with SINTEF 1

11 Outlook Production has improved quality and we have stored excellent products for future sales to customers around the world Commercialization is taken serious and we are building sales organization with implementation of new sales strategies Sales leads starts to show results and the future will show revenues and good margins Focus going forward: Bring Sales organization to a higher level of performance and sustain that performance over time Further work on brand building Presence at trade shows this fall in Las Vegas, Chicago and Jakarta

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