HQ Sustainable Maritime Industries Inc has reported a third-quarter sales increase of 27%. The Seattle-based company recorded Q3 sales of $28.2 million (€20.3 million), up from $22.2 million (€16 million) achieved in the same period of 2009.
It said the increase in sales was primarily the result of strength from new feed products added in late 2009.
Aquaculture product segment sales decreased by 4% to $13.4 million (€9.7 million), compared to $14 million (€10.1 million) in Q3 2009. The aquaculture product segment sales decrease is primarily related to an overall volume reduction of shrimp and ocean-caught fish products sold in the quarter compared to 2009, slightly offset by an increase in tilapia sales.
Health and bio-product segment sales increased by 6% to $8.6 million (€6.2 million) in Q3, compared to $8.1 million (€5.8 million) in the same period last year. In addition, the company's new feed mill generated sales of $6.2 million (€4.5 million).
Gross profit for Q3 decreased 3% to $9.5 million (€6.8 million), compared to $9.8 million (€7.1 million) in Q3 2009.
HQ's gross profit ratio decreased to 34% in Q3 2010 versus 44% in the third quarter of 2009. Although higher sales were recognised in Q3 2010, the gross profit ratio decreased mostly due to a lower mix of segment gross profit from the feed products operations.
For Q3 2010 operating income increased by $2.9 million (€2.1 million) or 60% to $7.8 million (€5.6 million) compared to $4.9 million (€3.5 million) in the same period of the prior year.
The operating income increase experienced was primarily due to the recovery of bad debt, as the aging of receivables improved compared to the prior year period, which was slightly offset by lower gross profit.
EBITDA for Q3 2010 increased 63% or $3.1 million (€2.2 million) to $8 million (€5.8 million), compared to $4.9 million (€3.5 million) for the same period last year.
"We are extremely pleased with our third quarter financial performance. Our management team continues to execute on our operational and strategic initiatives for growth," said Norbert Sporns, HQ president and CEO.
"We believe we have laid the groundwork for future financial and operational successes through our vertically integrated approach to all-natural tilapia aquaculture bio-mass product development and distribution. We are very optimistic about our outlook for the remainder of 2010 and more importantly fiscal 2011 as we focus on long-term profitable growth and strong cash flow generation."
For the first nine months of 2010, sales increased by 29% to $63.2 million (€45.6 million) compared to $49 million (€35.3 million) for the same period last year.
Gross profit decreased 2% to $20.4 million (€14.7 million) compared to gross profit of $20.8 million (€15 million) for the first nine months of 2009.
