Lower than expected revenues put more pressure on Proximar
The Japan-based salmon farmer is struggling with harvest weight and expects Q2 revenue to be lower than initially expected. This will create further pressure on liquidity, it says in its Q1 report.
The company previously experienced biofilter failures, which resulted in reduced feeding, capacity constraints, cohort mixing and later lower harvest weights in the affected batches. Now it has also incurred an additional problem.
"Higher than expected survival and no culling has placed limitations on available tank capacity to retain ready-to-harvest fish to allow the largest fish to grow to over 3 kg. As a strategic measure to achieve stable production above 3 kg, Proximar has decided to harvest smaller sizes of fish in the second quarter to free up tank capacity and allow larger fish to grow for an additional six to eight weeks," the company writes in a stock exchange release that accompanied the Q1 report.
This, Proximar points out, will reduce harvest weights in the current quarter, but is expected to result in better harvest sizes from the third quarter onwards.
The revised harvest plan will also move the planned December harvest of around 110,000 fish to January 2027, further impacting expected harvest volumes for the full year, down to 3,000ā3,400 tonnes head-on gutted, from the previous 3,500ā4,000 tonnes HOG.
Increased liquidity needs
The company further writes that it is now considering alternatives to handle the liquidity needs that arise from adjusted sales expectations.
"Harvesting smaller fish in the first quarter resulted in lower than expected revenues and a short-term liquidity need. The company has secured a new loan of 300 million Japanese yen, equivalent to approximately NOK 18 million kroner, from a regional bank, with disbursement completed in May 2026."
What is new now is that the continued low harvest weights and exposure to the spot market are also expected to affect revenues in the second quarter.
"Proximar has proactively requested an exemption from the sales requirement associated with its syndicated bank loan, and discussions are developing constructively," it writes.
The lower-than-expected revenues in Q2 will trigger additional liquidity needs, the company says, and it is now assessing the overall impact and exploring various possible financing sources.
"At the same time, Proximar is actively exploring refinancing options for the syndicated bank loan maturing in August 2026, including a possible 12-month extension of the term," it says.
However, Proximar says that it is experiencing strong interest and support from banks and other stakeholders.
"As part of the strategic planning, the board is considering engaging a Japanese investment bank to conduct a strategic review with a focus on the company's long-term development," they write.
Production in Q1
During Q1, Proximar harvested the last mixed group of fish affected by previous production disruptions.
Despite record-high harvest volumes, the challenging market situation and low average harvest weights affected price realisation and revenue in the quarter.
According to the company, biological performance remained strong, with a superior share of over 95% and high survival of 97.6% in grow-out.
"We delivered record-high harvest volumes in the quarter, and biological performance continued to improve throughout the period. Although revenues are impacted by the challenging market situation and harvest sizes that are still below the 3-kilogram limit, the operational progress we are seeing gives us strong confidence in our long-term outlook and ambitions. Based on this, we are now implementing measures to improve size and price achievement in the second half of 2026," says chief executive Joachim Nielsen.