Blue Star Foods Corp. Reports Fourth Quarter and 2020 Annual Results

Rhea-AI Summary

Blue Star Foods Corp. (OTC:BSFC) reported its financial results for Q4-2020 and FY-2020. Key highlights include a return to profitability with an Adjusted Cash Net Income of $247,569 in H2-2020, up from a loss of $1.4 million in H1-2020. Revenue decreased to $14.1 million in FY-2020 from $23.8 million in FY-2019, primarily due to COVID-19 impacts. The company reduced its working capital line of credit by 74% and paid down $1.6 million of debt, strengthening its balance sheet. Blue Star entered the Recirculatory Aquatic Systems industry through an acquisition of Taste Of BC Aquafarms.

Positive

• Returned to profitability with Adjusted Cash Net Income of $247,569 in H2-2020.
• Reduced working capital line of credit by 74%, from $6.9 million to $1.8 million.
• Paid down $1.6 million in outstanding debt, leading to future savings on interest expenses.
• Acquired Taste Of BC Aquafarms, entering the Recirculatory Aquatic Systems industry.

Negative

• Revenue for FY-2020 decreased to $14.1 million from $23.8 million in FY-2019.
• Q4-2020 revenue fell to $2.7 million, down from $4.7 million in Q4-2019 due to COVID-19 impact.

Miami, Florida, April 16, 2021 (GLOBE NEWSWIRE) -- Blue Star Foods Corp. (OTC:BSFC), (“Blue Star”), a sustainable seafood company, announced today its financial results for the quarter ended December 31^st, 2020 (“Q4-2020”) and Fiscal Year 2020 (“FY-2020”).

Fourth Quarter 2020 Operational Highlights:

		Signed a term sheet to acquire Taste Of BC Aquafarms, marking Blue Star’s entry into the Recirculatory Aquatic Systems (RAS) industry. Taste of BC Aquafarms is based in Nanaimo, British Columbia, Canada and is one of the longest operating, land-based Steelhead Salmon farms using RAS.
		Strengthened balance sheet by paying $1.6 million of outstanding debt, resulting in future reduction of interest expenses.

“In the fourth quarter of 2020, we focused on further operational efficiencies and transformation efforts as another major wave of COVID-19 cases worked its way through the United States. We took steps to strengthen our balance sheet and reduce our outstanding debt and improve our cash position by selling certain assets. These steps were taken in preparation of an anticipated market recovery in 2021, as more Americans get vaccinated, the economic stimulus passes through the system, dining restrictions are lifted, and certain economic capacity constraints on the economy are removed.” said John Keeler, CEO of Blue Star Foods Corp.

Fiscal Year 2020 and Q4-2020 Financial Highlights

Return To Profitability:

		The Adjusted Cash Net Income(1) for the six months ended December 31st, 2020 was $247,569 vs. an Adjusted Cash Net Income Loss of $1.4 million in the six months ended June 30, 2020.
		The return to profitability was due to an increase in retail sales in the second half of the year due vs. the more severe economic shutdown in the first half of the year due to COVID-19 dining shutdowns, and also to significantly improved operational efficiencies.

Strengthening the Balance Sheet:

		The Company reduced its $14.0 million working capital line of credit by 74%, from an outstanding balance of $6.9 million as of December 31, 2019, to $1.8 million as of December 31, 2020.
		The Company paid down $1.6 million of unsecured promissory notes and sold $439,700 of certain fixed assets.

Net Sales:

		Revenue for the twelve months ended December 31, 2020 was $14.1 Million as compared to $23.8 million for the twelve months ended December 31, 2019.
		Revenue for the three months ended December 31, 2020 was $2.7 million as compared to $4.7 million for the three months ended December 31, 2019.
		This was a result of a decrease in poundage sold due to the impact of the COVID-19 pandemic during the twelve months ended December 31, 2020, primarily affecting the first half of 2020.

Total Operating Expenses.

		Operating Expenses for the twelve months ended December 31, 2020, decreased 56% to $3.1 million as compared to $7.2 million for the twelve months ended December 31, 2019.
		Operating Expenses for the three months ended December 31, 2020, decreased 73% to $409,287 as compared to $1.5 million for the three months ended December 31, 2019.
		This decrease is primarily attributable to reducing strategic variable expenses across all subsidiaries as well as all fixed expenses related to operations.

The Company’s Chairman and CEO, John Keeler stated, “2020 was an interesting year to say the least, but our team got through it and we are stronger than ever operationally. When an unprecedented crisis of that nature strikes, one has to focus on the basics of what made us successful in the first place, and we did that. As the economy starts returning to normal, we believe our sales will return to pre-pandemic levels, but this time with much better operational controls in place to make us more profitable than before.”

About Blue Star Foods Corp.

Blue Star Foods Corp. is a sustainable seafood company that processes, packages, and sells refrigerated pasteurized Blue Crab meat, and other premium seafood products. The Company believes it utilizes best-in-class technology, in both resource sustainability management and traceability, and ecological packaging. Its products are currently sold in the United States, Mexico, Canada, the Caribbean, the United Kingdom, France, the Middle East, Singapore, and Hong Kong. The company’s headquarters are in Miami, Florida (United States), and its corporate website is: http://www.bluestarfoods.com.

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The Adjusted Cash Net Income is a Non-GAAP Financial Measure and is the Company’s Net Income adjusted for the minor issuance of stock dividends and certain professional fees. We report Adjusted Cash Net Income to measure our overall results because we believe it better reflects our net results by excluding the impact of non-cash equity-based compensation, and believe it enhances our investors’ overall understanding of the financial performance of our business. The Cash Adjusted Net Income of a loss of $1,346,754 for H1-2020 includes an addback of a Debt Forbearance Fee (paid in equity) of $2,655,292, Interest Expense of $119,378, Depreciation/Amortization of $153,196 and Stock Based Professional Fees of $69,960. The Cash Adjusted Net Income of $247,569 for H2-2020 includes an addback of Interest Expense of $86,858, Depreciation/Amortization of $115,145 and Stock Based Professional Fees of $138,420.

Contacts
Brett Maas Hayden IR
Email: brett@haydenir.com 
Office: (646) 536-7331

FAQ

What were Blue Star Foods Corp.'s financial results for Q4-2020?

Blue Star Foods reported Q4-2020 revenue of $2.7 million, down from $4.7 million in Q4-2019, due to COVID-19 impacts.

How did Blue Star Foods perform in FY-2020?

In FY-2020, Blue Star Foods generated revenue of $14.1 million, a decrease from $23.8 million in FY-2019, primarily due to the pandemic.

What is the significance of the acquisition of Taste Of BC Aquafarms?

The acquisition of Taste Of BC Aquafarms marks Blue Star's entry into the Recirculatory Aquatic Systems industry, diversifying its operations.

How did Blue Star Foods improve its balance sheet?

Blue Star Foods strengthened its balance sheet by paying down $1.6 million of debt and reducing its working capital line of credit by 74%.

What was the Adjusted Cash Net Income for Blue Star Foods in H2-2020?

Blue Star Foods reported an Adjusted Cash Net Income of $247,569 for the six months ended December 31, 2020.