Aker Reports Record Superba Sales

OSLO, NorwayAker BioMarine reported the second quarter of 2011 was strong financially with record sales of Superba krill, an expanded agreement to supply Schiff Nutrition International, staff recruitment and product development.

Group operating revenues in the second quarter of 2011 were NOK 87 million  (USD 16 million), up from NOK 78 million (USD 14.2 million) in the second quarter of 2010. The increase is largely attributable to Superba krill and Qrill sales growth. Operating profit before depreciation and amortization (EBITDA) amounted to NOK 24 million (USD 4.4 million) in the second quarter of 2011, up from NOK 14 million (USD 3 million) in the second quarter of 2010.

In the second quarter of 2011, the Saga Sea produced 4,263 metric tons (MT) of the feed ingredient Qrill; the corresponding production volume in the second quarter of 2010 was 4,344 MT. Production of Superba krill has a monthly production capacity of about 40 MT, according to the company.

The second quarter of 2011 had the highest sales of Superba krill in the history of Aker BioMarine. The company sold a total of 61 MT of Superba in the second quarter of 2011, compared with 56 MT in the first quarter of the year and 46 MT in the second quarter of 2010. Measured in terms of volume, 73 percent of second-quarter 2011 Superba Krill sales were to U.S. customers; the remaining volume was largely sold to European customers. In the first quarter of 2011, Aker BioMarine signed a five-year agreement for delivery of a minimum of 230 metric tons of Superba to a customer in China. Deliveries will begin as soon as regulatory approvals and import licenses have been granted. Permit and licensing approvals are expected in the second half of 2011, which would allow the first deliveries to be made by year-end or in early 2012. In the second quarter of 2011, Aker BioMarine entered into its first agreement for Superba to be used as an ingredient in a product that promotes joint health.

In the second quarter of 2011, Aker BioMarine sold 2,755 MT of Qrill. The volume represents a significant increase compared with the first quarter of 2011. BioMar signed a 5-year agreement with Aker BioMarine to purchase about 30 percent of Aker BioMarines annual Qrill production.

Royalty revenues from licensed CLA/Tonalin® production amounted to NOK 4 million (USD 750,000) in the second quarter of 2011, compared with NOK 6 million (USD 1.1 million) in the second quarter of 2010.

In the second quarter of 2011, Trygg Pharma, which is owned by Aker BioMarine and Lindsay Goldberg, purchased a factory in Seal Sands, Middlesbrough, in the UK from Lundbeck Pharmaceuticals Ltd; the purchase price was DKK 120 million (USD 23.3 million). The transaction was financed through a NOK 150 million (UDS 27.5 million) share issue. Aker BioMarine subscribed to half of the share issue, or NOK 75 million (USD 13.8 million), which is consistent with the companys 50 percent stake in Trygg Pharma.

Aker BioMarines application to Norwegian authorities for a krill harvesting license for the Antarctic Navigator factory trawler was unsuccessful. The strategic rationale for increasing harvesting and production capacity is to be able to satisfy the considerable market demand for the companys Superba and Qrill products

Development is underway of a proprietary powdered product made from Antarctic krill and designed for targeted dietary supplement formulations. A range of more refined Superba oil products is also under development for end products featuring higher specification and quality parameters.