Good morning, and welcome to presentation of the second quarter results for Aker BioMarine, where myself and CFO Katrine Klaveness will take you through the highlights and the financials from the quarter, followed by a Q&A session. You can already now start to send in your questions to ir@akerbiomarine.com. First of all, I'm really glad to be standing here now for the fourth quarter in a row, where we report growth year-over-year for Aker BioMarine, delivering $89 million of revenue for the second quarter and $21.5 million of EBITDA. The harvesting in the quarter was good, and we are on track for a normal harvesting year. Given the jump that we see in top line, you would expect an higher EBITDA than what we report now in the second quarter, that is driven by three things.
Number one is that we onboarded a large customer in the second quarter with a one-off investment to get them on board. Number two, the fuel prices in South America is extraordinary high compared to pricing in Europe, driving COGS for our aquaculture segment up. Number three, as we're building down inventory of krill oil in Houston, we have limited production and therefore driving COGS for Superba also up. It has been an eventful quarter, starting with getting finally the approval for Korea in the beginning of the second quarter, now our customers and partners are preparing for going live towards consumers in the Korean market, they expect the first TV campaigns and the first home shopping programs to start in August.
We also took delivery of our autonomous drone that we will use in our harvesting operation to optimize where we are in all different times in Antarctica with our fishing vessels. We have also now finalized our protein pilot plant here outside Ski, on time and on budget, and are now ready to move into commercial phase for our protein product. We have also announced that we're doing a change in segment reporting for Aker BioMarine and a legal restructuring, and we will get back to the details of that later in the presentation today.
As mentioned, we delivered $89 million of revenue for the quarter, up from $73 million in the same quarter last year, delivering an EBITDA of twenty-one and a half million dollars, on par with the same quarter last year, driven by those three things that I mentioned: one-off investment to onboard one large customer, extraordinary high fuel prices in South America compared to Europe, driving cost of goods for aquaculture up, limited production in Houston, driving cost of goods for Superba up. On the harvesting side, we have started well for the year. Second quarter, we delivered close to 18,000 tons of production, 9% better than the same quarter last year.
The third quarter has started well, year to date, as of yesterday, we have almost produced 40,000 tons of product, slightly ahead of the same period last year. There's more limited competition in Antarctica this year compared to last year. Eight other vessels, in addition to our three, are competing for the raw materials down there, down from nine the previous year, following a trend we see the recent years of fewer and fewer vessels involved in krill harvesting. As mentioned, we have taken delivery on our unmanned surface vehicle, the drone that we will use together with our big data model to guide our captains to where to take our vessels to optimize our fishing activity. It is now delivered.
It will go into operation later in this season, it will help our fleet to make sure that we are at the right spot, at the right time, both avoiding using the big fishing boats to search for krill, also making decisions when fishing are okay where we are, maybe it's better somewhere else. We are on good track to deliver on what we call a normal harvesting year for 2023. In the animal health and nutrition segment, or the QRILL segment, we continue our strong development. We see 30% year-over-year revenue growth for the QRILL Aqua segment. We have about 9% underlying price growth in our customer base, we have this one-off investment to onboard one large customer in the second quarter that is impacting pricing.
I mentioned in the last quarter, two new large customers coming on board, 5,000 tons each for 2023. This quarter, we are announcing a third large new customer coming on board, also representing 5,000 tons of demand for the second half of 2023. There are some market dynamics around us connected to fish meal and fish oil, which are important substitutes for QRILL products that are positively impacting market dynamics. This may have an impact both on demand and pricing going forward of positive nature. I will dig a little bit deeper to that later.
We expect the aquaculture segment or the animal health and nutrition segment to continue its strong development and are guiding revenues for the QRILL portfolio to be higher in the 3rd quarter compared to the same quarter last year. I'm also really glad now to show a continued positive development for Superba. Third quarters in a row in a positive trend for Superba, delivering 42% growth year-over-year, $20.4 million of revenue, driven by especially healthy development in Australia, in Europe, and in Asia. In Asia, we have now both sales in Korea, and China is continuing to develop very positively.
I was myself traveling in China for a week earlier this month, and could see the increased activity level and the interest in krill oil products as it's starting to be more mainstream in the nutraceutical market in China. As mentioned, we got the approval for Korea beginning of the quarter, and our customers are preparing both finished products and marketing campaigns, and are expecting to go live towards consumers in Korea in August. We have already starting to ship volumes to Korea, and based on the forecast that we're seeing from our customers in the market, we can see that our customers are anticipating a success when they go live. We are taking a little bit different strategy to Korea compared to what we did last time.
We continue to work with our longtime partner, the same partner we had, the last round. In addition to that, we're working with our partner and now also a broader network of large dietary supplement brands in Korea, to go deeper in distribution and consumer education around krill oil in the Korean market. We got a similar regulatory approval in China during the quarter. Got the government-approved health claim for immune health, meaning that the government has assessed that krill oil will improve your immune strength in China. It's a bit a more lengthy thorough process. It's gonna take about 6-12 months from when that was qualified, this quarter, until it can be used.
It's also structured in a different way, where these type of approvals are given by brand by brand, connected to our ingredient. This approval is given to a combination of us and one customer or one prospect of us. We expect the positive development for Superba to continue, and are guiding third quarter to be higher than the third quarter last year. I mentioned during the Krill with Q section that there are certain market dynamics around us, that may impact both demand and pricing for our products positively. That has to do with the markets for marine proteins and marine omega-3s, meaning fish meal and fish oil. It started already in 2022, where the fisheries in Peru had much lower yield than what they normally have.
Peru, they stand for about 20% of all the fish meal production in the world, and between 30% and 40% of all the fish oil production in the world. Last year, we were getting much less omega-3 out of the fish that was catched in Peru, and as a result, the supply of omega-3 went down, and as a result, prices starting to rise. On top of that, the aquaculture industry, which is the biggest consumer of omega-3 in the world, they've been keeping the demand in check as they've been growing, by optimizing down the use of omega-3 in the diets. They have now optimized it down to a level where they can't take it any lower, which means that the demand from aquaculture industry on omega-3 is starting to increase.
You have the combination of less supply, and more demand. On top of that, the Peruvian government canceled the fishing season for the first half of 2023, and it's expected that they will also cancel the second half of 2023, which will put even further constraint on the supply of both fish meal and fish oil to the global markets. As a result, we have seen fish oil prices triple over the last 12-18 months, and fish meal prices going up 30%. Less sensitivity on price there, as there are many alternatives for proteins the aquaculture industry can use. While for fish oil, there are very few alternatives, but krill oil is one of them. How will this impact Aker BioMarine's business? Starting with the supply and pricing for fish oil.
In our QRILL product that we sell into the aquaculture, we have a fair, good amount of omega-3, and typically, when a farmer will take in our product to the diet of the fish, they will reduce the amount of fish oil, meaning that when fish oil prices goes up, the willingness to pay for our product also goes up. If you look at the impact the fish oil market has on the Superba market, the situation is that we have a high price premium for krill oil compared to fish oil. On the shelf in retailers, you know, for consumers, the price premium between krill oil and fish oil is between four and six times. When prices for fish oil goes up, that price premium for between krill oil and fish oil will shrink, and the competitiveness of krill oil will improve.
On the fish meal side, on the aquaculture with our krill with Q products, the impact is similar, like with omega-3 fish oil, meaning that typically, when the farmer add in our product to the diet, they will take out fish meal, and therefore, when fish meal price goes up, the willingness to pay for our product also goes up. The fish meal market dynamics has no impact on the Superba business. What does Aker BioMarine strategies look like on top of this situation? The pricing strategy that we've been following since the beginning for our krill with Q products, has always been to gradually grow prices as customers and farmers get experience and see the value our products provides to their farm. Meaning that we don't wanna become a commodity that fluctuates up and down.
That being said, we would like to utilize, and we have always utilized, the positive momentum that we see in the global raw material markets around us. Therefore, now we are only committing pricing to our customers for six months at a time, to make sure that we always can use the latest data in price negotiations with customers. As a result of this supply and price crunch that we see for fish oil and fish meal, we're already seeing the demand for our products increasing significantly, and we have already reserved all the planned production for 2023 to customers. For Superba, on the human side, it's a little bit different strategy.
We already have a high price premium, a high price, and our strategy is not to increase that price as fish oil prices increases, but rather increase the competitiveness of krill oil versus fish oil. As mentioned, the price premium today is between four and six times, you know, for krill oil compared to fish oil. We know that about 20% of the dollar price you see on the price tag in a retailer is driven by the crude fish oil price that is now spiking up. Which means that now when fish oil price goes up, the prices on those products on the shelf will also go up quite significantly, making krill oil alternatives more competitive.
We also believe that there will be a limit, both for brands and for retailers, for how much fish oil brands can increase their prices before they will take the product out and replace it with something else. There, Aker BioMarine will be ready with our product portfolio as alternatives to replace those products with. Also, we haven't talked much about our protein progress in the latest quarter. That is because we are now mainly focused on our core business of Aker BioMarine. Today, it's worth mentioning it, as we have now completed our factory that we've been building over the last period of time, on time and on budget. We have now run the first production of krill raw material through the whole process, and getting a human-grade protein out at the other end.
We will continue to run tests throughout the summer, and we'll move into commercial production in September. We already have regulatory approval for the U.S., for Australia, New Zealand, and certain Asian countries, and we are in dialogue with protein brands globally to engage in commercial agreements with these companies. We're also now engaged in formulation trials, meaning working on how we will take our protein ingredients and formulate it into energy bars, different sport drinks, or protein powders. On the branded side, our private label business continued to develop strongly. 11% growth year-over-year for our private label business, Lang, driven both by increased demand, more products sold, and also the fact that we increased pricing at the end of last year.
We have also now gone live with the new category that we've been working heavily on the last period of time, meaning this gummy bear delivery, where we can deliver vitamins in something else than a pill. The first customer out is Sam's Club, which is coming out in the quarter with a multivitamin in this new gummy technology that we have exclusive access to. The plan is to use this technology to deliver other types of vitamins and roll it out to other retailers as well. Epion's sales for Kori from us to retailers were down 6%, impacted just by the buying patterns and the planned promotional plan for retailers. The POS sales, meaning sales of Kori from retail to consumers, were up 28% compared to the same quarter last year.
Given also the situation in the fish oil market, it's worth mentioning that on the private label side of our business, fish oil is a largely, a relatively large segment, representing 24% of the revenue for Lang in 2022. It has a significantly lower margin than the rest of the business, but still, it is a significant business for us. We are sourcing fish oil with 6 months kind of ahead of time, making sure that we have inventory, and we're rolling out the price increases to the retailers as they happen. We're also ready with alternative products for the retailers if they should come to the point where they feel the pricing for fish oil is getting too high, and our krill oil product portfolio is part of that plan.
Moving into the new financial reporting and legal restructuring of Aker BioMarine. Historically, Aker BioMarine has been segmented in two segments, is the ingredient segment, where we have kind of bundled in all our ingredient-related businesses, so our harvesting vessels in Antarctica, all our logistical operation, protein factory in Norway, Houston in U.S., and all the different sales teams. Everything bundle into one segment, and the same on the branded side, where we bundle together the kind of steady state, like cash flow generating, private label business with our kind of high investment business of Aker BioMarine or Kori.
It has been necessary to be segmented like that, as we have built Aker BioMarine, so we could optimize supply chains, we can tune in products, and build scale so that the businesses could stand more independently on their own legs. Now the time is right to do a different type of segmentation. We're gonna divide Aker BioMarine into four different segments or business units. The first segment is what we call the feed ingredient segment, which is basically our krill meal business. It's gonna be our harvesting fleet in Antarctica, our logistical vessel, our logistical hub in Uruguay, as well as all our commercial activity related to krill with Q products for the pet food and aquaculture industry.
The second business unit or segment will be the human health ingredient business, which is the krill oil-based business we have. Superba, it's gonna be Lucovitaal, it's gonna be PL+, and the manufacturing related to that in Houston, Texas. The third one will be a consumer health product, so the steady growing cash generating business of private label in one clear segment. Then we create a fourth business unit or segment that we call emerging business, which is a portfolio of those companies that are in early stage, in the investment phase and under development. This business unit, we're gonna work with different type of strategies, including M&A activities, spinning out and organic plans, in order to get those businesses into positive territory as soon as possible.
There's three reasons why we do this, restructuring and change in financial reporting. First of all, is that we've been getting feedback from the investor market for quite some while, that the transparency of Aker BioMarine is low, and it's difficult to understand the P&Ls and the business drivers for the company. By this segmentation, with clear P&Ls for each of these business units, we will provide more transparency and a clearer P&L that will be easier to understand for the investor community. Secondly, is that we have gotten feedback that it's really hard to do valuation of Aker BioMarine because you really can't find any peers that looks exactly like Aker BioMarine.
By also dividing into these four business units, you will get now clear P&Ls for each of them, with revenues, with EBITDA, and many peers with each of them that you can compare and help in valuation. That's reason number one. Reason number two, is that by dividing into these clear, distinct business units and segments, it will allow Aker BioMarine to be laser focused with our strategy and our priorities in each of those four business units. I will also get a kind of full P&L accountability with the team for each of those four business units, making sure that we always make the right priorities for the P&L, for each of them.
The third reason is that the legal restructuring that's gonna follow this segmentation into business units will allow us to do flexibility for transactions related to each of these business units to drive shareholder value further. We will start reporting on this new structure starting first quarter, 2024. We wanted today to give a little sneak peek what these businesses look like, also from a number perspective. What we have done here, is to looked at our 2022 numbers and divided it into those four business units. If you start with the feed ingredient segment, which will be a business, which will be the world-leading harvester or krill, will control, you know, the biggest biomass on the planet.
We'll have a premium ingredient with well-documented health benefits with healthy margins and all the key players in the industry on the customer list, addressing a fast-growing aquaculture and pet food segment. That business in 2022, represented $124 million of revenue. Krill meal from that segment will be sold into the human health ingredient segment at market pricing. Human health ingredient business will then be the world-leading manufacturer and distributor of krill oil in the B2B market for nutraceuticals globally. It will be one of the most attractive omega-3 companies out there, with a differentiated position with a high margin, IP-protected product portfolio, and a strong portfolio of science, documenting the health benefits and providing claims approved by governments.
It will have a strong innovation pipeline with Lucovitaal and PL+, and will also address a underlying strong growth market in the global dietary supplement and omega-3 markets. That business in 2022 was $66 million. The human health ingredient business will then sell krill oil to the consumer health product business unit, which then consists of Lang and our private label business. That will be, our consumer health product business will consist of our exclusive innovative dietary supplement offering for the largest retail chains in the U.S.. It has one-of-a-kind innovation machine, providing and evaluating more than 100 new ID product IDs every year, presenting about 50 of them to retailers and getting about 20 new products on the shelf every year.
Has flexible manufacturing, doesn't own its own manufacturing facilities, go with whoever has the best price, the best technology at any given time, ensuring high service level for customers and low costs for us. Addressing a large and fast-growing dietary supplement market for private label in the U.S.. That business in 2022 represented $108 million of revenue. Those three business units are a kind of healthy, clear, cash-generating businesses that will just continue executing on its kind of step-by-step drum beat strategy to get its growth plan in place. Combined, they generated in 2022, $82 million in EBITDA. The fourth bucket, the emerging business portfolio, we gather Kori, which is still in the investment and development phase, our own consumer brand on the retail shelf in the U.S..
It will consist of Understory, which is the new brand name for our protein ingredient, with a factory we just finalized in Ski, outside Oslo. It will have AION in the portfolio, our plastic circularity company that we spun out last year, and also Qpos, which is a small app that was developed as part of the marketing activities for our pet food segment, but has turned in to become one of the leading dog activity apps in the world. Those four businesses here, we will have a kind of workout plan that both includes transactions and organic plans for how to get them from this kind of early stage negative cash train situation to a positive territory. In 2022, those four businesses represented $14 million in revenue and about $13 million negative EBITDA.
As mentioned, starting first quarter, 2024, we will start reporting P&Ls according to these four segments. With that, I will give the word over to Katrine, that will take you through the financials.
Good morning. I will take you through the financial section for the second quarter, 2023. We have seen good top line development this quarter compared to previous quarters. $89 million in revenue is an increase of 21% from second quarter last year, growth is driven from both QRILL Aqua, Superba krill oil, and our private label, Lang Pharma. Despite strong growth in revenue, EBITDA margins don't fully mirror the sales development. There are several reasons for this. Mads have already explained a few, I will add a few more. The first one is the unit cost that remains high for Superba krill oil as long as the Houston plant runs on low to no capacity. This increases the COGS and reduces gross margin for krill oil.
Second, the unit cost has also increased for QRILL Aqua due to higher regional fuel spreads, I will come back to this, increasing the Aqua COGS and also reducing the gross margin. A large bulk sale that Mads also mentioned to a new account in the quarter, has diluted Aqua prices. Part of Lang's growth is also coming from sales to a lower margin customer this quarter. Finally, on the EBITDA margin, we sold some of our fuel contracts last year in the second quarter to balance our portfolio with our fuel requirements, leading to a positive EBITDA effect. As a result, the EBITDA is on par with last year at twenty-one per... $21.5 million, and with an EBITDA margin of 24% versus last year's 29%.
Net debt is at $399 million, up from last quarter. This is mainly driven by four things. We have completed the protein pilot plant with corresponding payments. We have high fuel costs in the quarter, as we did two large bunkerings. We have increased interest rates and lower cash balance at Lang due to inventory buildup that should normalize throughout second half of the year. Moving over to the ingredient segment. The ingredient segment showed strong growth of 21% from $49 million second quarter last year, to $62 million this quarter. Both QRILL Aqua and Superba were up compared to same quarter last year. QRILL Aqua increased by 30% and Superba increased by 42%.
Both categories also increased sales from last quarter. While this follows the annual seasonality for QRILL Aqua, we are very satisfied also to report a 13% growth quarter-over-quarter for Superba krill oil. That includes orders from South Korea to prepare for the market launch later in this quarter. Gross margin was 36% in the quarter, down from 47% in the same period last year. The reason being, the before-mentioned unit cost development for both Superba and QRILL Aqua, leading to lower gross margins. Fuel cost is expected to be close to $10 million higher in 2023 versus 2022, driving unit cost for QRILL Aqua up. For Superba, once Houston is back producing at normal capacity, the Superba margins will be restored to previous levels.
Adjusted EBITDA is at $21 million, on par with same quarter last year, and at a 33% margin, compared to 45% last year. SG&A is lower than same period as a result of the ongoing improvement program, despite both higher freight volumes and more sales activities this second quarter. A rebalancing sale of the fuel contracts in the second quarter last year had a positive EBITDA effect of $3 million. Adjustments in the quarter was $2.5 million. They all belong to the ingredient segment, including costs related to both the ongoing improvement programs and the restructuring projects. Some additional detail on the fuel spread situation. As stated earlier, the company has a hedging program in place to the end of 2024, with downside protection against the Rotterdam MGO fuel price.
The call options are in the money. For first half 2023, we had saved approximately $3 million in fuel costs. However, there is a regional spread between the European quoted prices and the South American prices. Historically, this spread has been around $200 million per ton. As you can see from the graph, this was the case until the end of 2022. As a result of global unrest, war, and general uncertainty, this spread has increased to around $500 million per ton. $500, sorry, per ton, resulting in an annual effect of approximately $10 million increased fuel cost for the company for 2023, due to the delayed effect of fuel costs being allocated to the inventory.
We expect the spread to go back to normal levels, as this arbitrage should not continue for too long, we don't know when. As a result, we are seeking alternative regions for buying fuel, including taking Antarctic Provider to Europe during shipyard, filling up the vessels in South Africa before they leave shipyard, and sail to Brazil as opposed to Falkland and Montevideo, as the spread is lower in Brazil. Over to the brands segment. Sales in the brand segment were up 9% compared to same period last year. Lang had its first shipment of the new multivitamin gummy for children to Sam's Club. Another shipment of gummy vitamins for adult will ship later this year. In addition, fish oil, organic vitamins, and the brain health category had strong growth in the quarter.
Epion sales of the krill oil was lower than same quarter last year as a result of lower promotional activity at the retailers this quarter. However, POS figures for krill oil are up year-over-year at 29%, indicating continued growth in sales out of stores. Gross margin was 24% in the quarter, down from 30% same period last year, due to customer mix in Lang, with strong growth in sales to a lower-margin customer. Adjusted EBITDA in the brand segment was $0.2 million for the quarter, with a corresponding margin of 1%. EBITDA for the segment continues to be low, as a positive EBITDA from Lang is netted with a negative EBITDA from Epion, as the company continues to invest in marketing to fuel further growth.
Marketing spend in the quarter was $0.9 million, slightly reduced to match lower sales. A few additional items in the P&L. The increased COGS reflects both the higher sales in the quarter compared to Q2 last year, but also the margin compression, as discussed earlier. SG&A is $2.1 million lower in the quarter, despite higher sales activities and more freight volume. The cost reduction is a result of the ongoing implementation of the improvement programs. Net financial items are significantly up in the quarter, mainly driven by increased interest cost of $7.2 million, almost doubled from Q2 last year, in addition to positive RGO in Q2 last year. EBITDA adjustments this quarter includes cost for the improvement program and the restructuring project, while Q2 last year had an AION fair value adjustment that was adjusted out of the EBITDA.
I will not spend much time on the balance sheet, but wanted to elaborate a bit on the inventory figure. Inventory is up both from year-end and from Q1 this year. However, Lang is driving the increase in the quarter, as they are preparing for shipment of the multivitamin gummy for adult later this year, and are also keeping some safety stock on fish oil due to the scarce markets. Inventory values in the ingredient segments are down from first quarter this year. The krill inventory has now been reduced, with close to 500 tons from Q2 last year as a result of the Houston curtailment, and we expect the plant to move back into full production next year. Equity ratio is 43%. Finally, the cash flow.
Net cash flow from operating activities was negative $14.8 million as a result of negative net profit, high interest rates, and increase in working capital as a result of higher sales and inventory buildup in Lang. Net cash flow from investing activities was negative $6.7 million, mainly driven by the protein pilot plant and shipyard items. The net cash flow from financing was positive $6.6 million, as we increased debt under the facilities with net $10 million. Net change in cash flow in the period was negative $14.9 million as a result of this. Our outlook from the third quarter 2023 is largely unchanged, as we expect growth compared to same quarter last year in both QRILL Aqua, Superba Krill Oil, and the brands segment.
harvesting is on track, and Houston will continue to produce limited volumes throughout the year to adjust inventory levels further down. That concludes the financial section, and we will move over to Q&A.
All right. Thank you very much. Now over to the Q&A session, and we have received quite a few questions here. Starting off, very strong sales in the QRILL Aqua segment. Could you give some color on the demand from aquaculture companies?
Yeah, demand is very high, I mean, both driven by the general macro picture of related to fish oil and fish meal, like I talked about. Also, I think the way we have presented the QRILL Aqua segment earlier, it takes some time for the farmers to get experience. They want to see the experience themselves and want to maybe cycle through, you know, one, two, three generation of fish before they really believe in the product. It's a combination of favorable macro conditions, as well as more and more customers getting experience with the positive benefit that our product actually brings to the farms.
Moving over to the Superba. Asia, Europe, and Australia is developing well. Could you provide some comments on market developments in the U.S. mass market?
The U.S. mass market is also developing strong. The last market which hasn't come of fired yet is the non-mass market in the U.S., so everything else than the big retail chains. MLMs, direct to consumer, e-commerce and so on. That's the last segment that hasn't fired yet in our turnaround plan. Mass market in the U.S. has also developed very strongly the first half of 2023.
To you, Katrine. How should we think about working capital movements in the second half of 2023? What is the working capital release potential in dollars?
We haven't commented on actual dollar release, but I think we will see a positive development second half. As I mentioned, Lang is actually the one driving the inventory up in this quarter. We expect them, as they do their planned shipments and also rebalance their inventory, to come down. We will continue to see a reduction in the inventory for krill oil in Houston as we continue with low production also in the Houston facility. Those two kind of key drivers will drive the inventory down and release cash. In addition, we had a very high sale in Q2, receivables are also high end of the second quarter. We will also expect to see cash release from this working capital in the second half.
We have a positive outlook, I would say, for the second half, but we'll not comment on particular or specific dollar amounts.
Moving a bit over to South Korea. When do you expect the first sales in South Korea? Will that be mid of the third quarter?
Yeah. We are already selling from Aker BioMarine to Korea. We are selling bulk, meaning in drums, into Korea, and then the customers there will put it into capsules and packaging and so on. We expect the first campaigns to go live during August. We will ramp up from there, you know, later in the quarter and towards the end of the year.
What are your ambitions for that?
If-
For sales, yeah, in South Korea.
Yeah, it's hard to know. I mean, we can only hear what our customers and partners are saying in Korea. They believe the market is still there. They believe that the fact that we have now a government stamp that basically says the quality of this product is good, it's documented in Korea to have these health benefits, that will be very positive. The fact that we're broadening up distribution, all kind of accounts for a very positive development. We will have the answer finally when we start to see the consumer reactions when they go live.
For QRILL Aqua, the new contract of 5,000 tons, is the price lower than the average price for QRILL Aqua?
I would say it's in line with the planned price for the second half of 2023.
Moving on. Considering the decline in EBITDA margins due to increased production and fuel cost, could you elaborate a bit on the strategic approach towards enhancing these margins and mitigating the impact of fuel price volatility?
I think I did describe some of the initiatives that we have on the fuel cost side to try to lower the cost. This is also part of the improvement program that we're currently running, is to see how we can source fuel differently. There are a variety of scenarios that we are currently exploring. One being taking Antarctic Provider to different regions and bunker with cheaper fuel. This is something that we spend a lot of attention and resources on. Of course, we see this spread. It worries us a bit, but at the same time, it has come down before, and it should come down again.
We believe it's just a matter of time before it kind of stabilizes, on the more normalized levels. What was the first part again? Sorry.
No, it was about. I think you answered it.
Okay.
I think it's worth mentioning, too, that, if you normalize for that fuel sale, or the contracts we did in the last quarter same quarter last year, the gross margin percentage will be almost the same, between this quarter and last year, despite these kind of negative factors.
Yeah. And of course, on the unit cost, you know, we are planning for, and hopefully we'll get Houston back in full production during 2024, which will then stabilize or move the Superba margins back to normalized levels. I think with those two kind of items, focusing on those two items, we hope to see restored margins early next year.
Okay, the company has an ambition to reduce CO2 emissions intensity by 50% by 2030. Could you shed light on the specific operational optimization, energy efficiency measures, and other initiatives you are undertaking to achieve this goal?
Yeah. If you actually look at our reporting for 2022, you'll see that we have already achieved one third of that 50% reduction goal towards 2030. We are on a good track. We're doing multiple things related to that. Especially the last, I would say, one- two years, we've been focusing on optimizing our harvesting operations, which is where most of our CO2 emissions are. That is everything from installing heat recovery systems that, you know, reuses heat on board our vessels from the factory, to getting different type of sensors so we can optimize the temperatures and how we run the factory and the engine.
It's not like one single initiative that will bring everything to order, but it's a set of many initiatives that brings that forward. Again, first, you know, two, three years into the cycle here, we are already one third into the goal.
We have a question here about the restructuring and how this is better aligned with your market segmentation. I think you answered that pretty well in the presentation, but maybe you can just repeat. Yeah, how the different segments align with markets, and how this will enable better understanding of and ability to track your performance.
First of all, you will get more details in the numbers. That's number one. I mean, once we then report P&Ls for each of these four segments, you will get more data and more kind of drivers, so it will be easier to come build models and understand how the business works. That's number one. Number two is that we have created four different segments that can completely be compared, at least for the three first ones, easily with other stock-listed companies that are providing ingredients to the aquaculture industry, or human supplement ingredients or fast-moving consumer goods companies.
I think the combination of more transparency, more data, and then having clear peers that you can compare our numbers with for valuation will make that much easier. From our internal purposes, these are distinct kind of markets with different dynamics, and we can adapt our strategies, priorities, and investments for each of those segments separately.
Some final questions here on harvesting. Assuming you reach the 50,000, 60,000 tons of normalized harvesting, what's the limiting factor? Is it license or is it vessels, or how can you grow beyond that?
It's basically, I mean, you have a license for the three vessels we operate. We have a fourth license, which we're not utilizing today. Of course, long term, we don't have any plans for that, but you could expand with another vessel. We are only fishing about 60% of the quota before the year is finished. It's all about how we can optimize the trawl in water time, meaning making sure that we have the trawl in the water as much as possible. Number two, making sure that we are at the right time, or right spot, at the right time, to be where the krill is.
By optimizing those two things, you could increase the harvest further, and this drone we took delivery for in the quarter is an important step in that direction.
I think it's also important to mention the yield optimization. There are the internal processes on board the vessels. To increase yield will also increase harvesting volumes, or not harvesting volumes, but offshore production volumes.
Is it easy to get another license, and how do you apply for it?
Yeah, not so easy to get, so we have another one, as mentioned. Basically, you can just apply for it. The Norwegian government need to put out kind of a process that you can now start to apply, which they did some years ago, and we applied back then. It's quite complicated to get that. It's quite tough requirements on what you need to do to be able to get one of those licenses. That is kind of one of the, what you call it, barriers for competition, that once the position we have, it's really difficult to challenge.
Another question came in regarding the new structure and the comments on the shareholder value and M&A. Do you see that you should accelerate growth in Aker BioMarine by partnering up with other companies? What should we expect beside more transparency?
I think, like I mentioned, this legal restructuring we do into those kind of four distinct business units will provide the necessary flexibility for us to do different type of transaction to drive shareholder value. And that's a key focus for us, being a listed company, that we're looking for how we can drive that shareholder value and exploring all opportunities related to that.
That concludes the Q&A. Thank you very much for listening in.
Thank you.