Good afternoon, everyone. Welcome to the presentation of The Kingfish Company. Today, Jean-Charles Valette, our CFO, and Vincent Erenst, our CEO, will present our results for the first half of the year. Vincent will kick off the presentation. So, Vincent, I hand it over to you.
Thank you, Marieke, and welcome, everyone. We are pleased to share results of our first half year 2025, some highlights. The most important thing, I think, we have further increased our sales volume by a 41% increase as compared to the first half of 2024 to 1,301 tons, and at the same time, revenue increased by 31% to 17 million EUR. We have reported in the past that we had a biomass that was higher than we wanted, and that created certain problems for us. We are now in a good situation. We have now the right biomass for the sales volume that we want, and our production volumes are in line with our sales volumes, which allows us to operate our farm in a much better way than we have been doing over the last 12 months.
I will go into more detail on these items in the next slides. So, if we can move to the next one. I think we have highlighted in the past that four things need to happen for us to reach profitability. First of all, we need to make sure that we get to the maximum capacity of this facility, which is somewhere around 3,500-3,700 tons per year, depending on the size of the large fish we produce. We want to maximize revenue through producing and selling as much large-sized fish as we can, as they have a higher price and also a higher margin than the smaller-sized fish. We have to make sure that our biological performance is optimal. This trifecta of aquaculture is growth, is one, survival is two, and feed conversion rate, usually a result of the growth, is number three.
Those three have to be optimized in a RAS system that really means that you have to make sure that the water quality is as good as can be so that the fish can eat as much fish as they want and realize most of all the growth you can get, and that we have been working on in the past, and now that, as I said before, that we have reached again balance between sales volumes and production volumes, we can actually start to maximize our production, and last, but definitely not least, is cost control in all stages, in all the things we do. I think we've gotten a lot better on that over the last quarters, and we continue to tweak these things wherever we can to get the lowest cost possible of our production and other activities.
Moving to the next slide, if we then see, I mentioned we moved to 1,301 tons of sales in the first half, up from 922 in the first half of 2024 and 1,070 tons in the last half of 2024. So, year on year, we've seen a 41% increase in volume. We continue to work very hard to increase our sales to high-end Horeca restaurant business, and we're doing that by continuing to increase the number of distributors throughout Europe. It's all about coverage. We've estimated something like 50,000-60,000 restaurants that we could potentially sell to in Europe. Of course, we have to reach them. So, it's very important that we increase our coverage so that we can reach as many of those food distributors, as many of those restaurants as possible. The restaurant business does prefer the larger-sized fish.
In the past, we would call a large-sized fish 2 to 2.5 kilos. Really, what the market wants is fish of 3 kilos and maybe even 4 kilos. So, we have moved up not only the percentage of the large-sized fish, but also the average weight of the large-sized fish. That's what the market is asking for. The last quarter, we were 53% large-sized fish, 47% last half year, sorry, 53% large-sized fish, 47% small, but we will increase that, the proportion of large-sized fish in the months to come. We believe it should be around 60%, maybe even 70% of our total product mix, and we will see that increasing in the time to come, that proportion. Next slide. When it comes to revenue, okay, the 40% revenue growth has led to a 31%, 40% volume growth has led to a 31% revenue growth.
That is, of course, because we did not maintain the price level we had two years ago. It might look a little bit alarming that we have actually reduced our revenue per kilo. But if you look at what actually drives that, I think it looks quite good. First of all, we see that in the segment we are now really concentrating on is large-sized fish to the Horeca business. We have actually very stable pricing. Then, the last two half years, the last year, as I mentioned, we were partly overstocked. So, we did sell a lot of small fish to bring our inventories down, and sometimes we had to promote those sales in order to get the volumes out. That's over now. I think we have a very good composition of our biomass.
In fact, for our small-sized fish, we have almost more demand than that we can deliver. So, in a very good situation there. So, we are now seeing that going forward, I think we'll see a small increase in overall pricing for fresh. But then, at the same time, also, again, as a result of a farm that had too much biomass in it in the past, we did freeze quite a bit of fish. We built up an inventory of Frozen fish. We are now moving that inventory, but at a slightly lower price than our fresh fish. So, that has an impact on pricing. But I do feel that from here on forward, we probably see this average price coming up again. Next slide. Then, something on the United States.
In the past, we had started to develop our fresh market in the United States and was going volume-wise, interesting growth. But then, of course, as we all know, quite a few things changed. First, in April, 10% tariff. Then, as of the 1st of August, 15% tariff for the European Union. On top of that, the U.S. dollar exchange rate versus the euro went from $1.05 to $1.16, $1.17. It is costly anyway to send fish to the United States. In order to get the same returns as we get in Europe, we need to significantly increase prices in the United States, and we are finding quite a bit of resistance to that, meaning it's not possible to compensate for the tariffs and for the U.S. dollar exchange rate.
So, for us, at this point of time, it's better to scale down, scale back our sales efforts on fresh in the United States and see how these things develop. It must, in the end, be attractive for us to sell. So, on fresh, we really scale down. Frozen, on the other hand, we will continue. We have a certain amount of customers in the United States that we'd like to continue to serve. Of course, on Frozen, we have much lower transportation costs. So, we will, for the time, continue our Frozen sales, see what we can sell on fresh, but it will definitely be much less volume than we did before. Of course, with these things, there is definitely a case for producing in the United States, not having to pay the tariffs and not being hampered by exchange rates, so to speak.
So, we remain very interested in our project in Maine. We haven't started yet, but we are looking in the time to come what we're going to do. Fortunately, we are through with the court cases that we reported on. However, with all these court cases dragging along, in the end, our municipal construction permit ran out. But in collaboration with the municipality, we have been able to prolong that license for another two years. So, we have another two years to start the project, and we'll see how that goes. But like I said, under the current, call it macroeconomic circumstances, it's definitely attractive to or more attractive to produce in the United States if you want to sell in the United States. Next slide.
When we come to production, over the last year, actually, production volumes, which I don't show here, have been very stable, typically around 600 tons per quarter, 1,200 tons per half year. That has been almost the same over the whole year. But as I said before, until now, our production volumes were higher than our sales volumes. That resulted in very high biomass in the farm, and then we had to reduce temperatures and reduce feeding to be able to house that amount of fish. That is all over now. We did a large sale of small-sized fish in the beginning of this year. By the end of June, we had reduced our biomass from 1,120 tons at the beginning of the year to 972 at the end of the half year, and today, even lower.
Today, we are around 900 tons, which we believe is actually the ideal biomass for this farm to get maximum production. So, from now on, I foresee that we can grow our production in line with the sales demand and how we develop our sales and remain in balance. An effect of this overstocking that we had was, I mentioned, we couldn't feed at the maximum rate. So, then the feed conversion rate goes up. As you can see in Q1 of this year, we were as high as 1.91. Fortunately, in the second quarter, we have brought it down already to 1.61. And over July, August, we are seeing further reductions. So, we're definitely, again, on track to come down to normal feed conversion rates and also lower cost of production as a result of that. Next slide. Or, in fact, I think we move on to Jean-Charles now on the financial side of the business.
Thank you, Vincent. Let's move to the financial consequence of what Vincent explained. So, first, starting with the farming cost. So, it's no surprise to see that the farming cost orientation has not been as good as we expected here. That's the result of the higher FCR that we have had in the past three to four quarters. Again, things will improve in the future, but there is a lag of about six months between improvement of the FCR and what we will see in our P&L. Overall, the costs are good. The feed costs, the feed prices were well oriented this year. They are going down, and they will continue to go down in the near future. So, that's positive. Energy costs have been very stable compared to last year.
You remember that our energy costs in the first half of the year are higher than in the second half because of the tax system on energy in the Netherlands. We had a good hedging. Spot prices are slightly higher than last year, but overall, it's good, and our consumption is decreasing. We have a number of engineering programs and also farming to minimize the energy consumption, which delivered savings of about 5% this year, so farming costs, again, have increased. We expect them to decrease. We, in the past, explained that we have a target of farming cost of about EUR 7 per kilo, excluding depreciation, and we confirmed this target. Our farming cost, it's about half fixed cost, half variable cost. The variable cost will decrease starting from H2 this year.
And we still confirm that we will go towards EUR 7 per kilo fairly rapidly in the next few quarters. Next slide, please. So, this converting into profitability. So, our gross margin is a little bit behind our expectation as a result of lower revenue per kilo and higher cost of goods sold. Again, the cost of goods sold, that's the result of the farming cost with a couple of months of delay. The fourth pillar in our strategy is really to optimize the cost. We've been scaling. We've been growing a lot in the last few years. We've been learning a lot. It's now time for optimization of the organization. So, we've been increasing our sales force. That's part of our strategy, also resulting in this 40% sales growth that we have seen in this half year. We have been increasing our sales force quite significantly.
The costs have increased by 40%. However, the cost per kilo sold is stable for the sales force. SG&A costs have reduced in absolute term by 6%. So, leading in total to SG&A cost per kilo going down to 3.6 EUR per kilo. So, we are very focused on, again, optimizing the organization, controlling the cost very strongly, and benefiting from the scaling impact on our sales. Operational EBITDA, again, is a little bit behind our expectation. What we announced earlier is that we expected to break even on EBITDA in the course of 2025. So, that was in the back end of 2025. Because of the biological performance, which is behind but improving, we think that there will be a delay of one to two quarters for the break even on EBITDA. So, EBITDA will be close to zero this year, but maybe not exactly breaking even.
Early next year, we expect to break even on EBITDA if the biological performance is increasing the way we've seen it in the last few months. We expect to reach, again, the performance we had earlier in 2023 and 2024. We see also on pricing because of different activities, less promotional activities, better size mix that our revenue per kilo is also well oriented. Therefore, we will break even on EBITDA, but probably one to two quarters in early 2026 rather than the back end of 2025. On cash, cash is also obviously a very important element for us. We have EUR 15 million of liquidity and available financing facilities at the end of the quarter. We had a financing run last year that was fully paid in January. We capitalized the interest on our loan in Q1, and we started to pay again interest in Q2.
We've been very strict on CapEx, and we have been able to maintain the CapEx, farm CapEx at a very low level. It's about EUR 1.2 million during this first half of 2025. Working capital is well oriented. The biomass is going down. We still have a little bit of excess Frozen inventory, but also going down. We think that in the second half, this decrease of inventory will accelerate. Our receivables are going up, which is normal considering the volume increase and the revenue increase of 30%. Working capital is going in the right direction. With good control over CapEx, we have sufficient liquidities to continue the growth of the company until we are cash positive, generating cash. It's a little bit where we are today.
Also, I confirmed that was announced earlier that we've closed the hatchery, the pilot hatchery we had in the U.S. We've consolidated all the hatchery operations in our hatchery in Kats. This hatchery has been performing extremely well, developing fourth generation of fish, now working on the fifth generation. And again, in terms of resource allocation, saving the cost, optimizing the organization, this was an important step. So, for the first half, not exactly the result we wanted to have, but we see good orientation on many critical indicators. Maybe a little bit of delay by one or two quarters in certain indicators, but there is a very strong momentum. And we believe that we will deliver our result also with a little bit of lag of one or two quarters. So, this being said, back to you, Vincent, for the concluding remarks.
Yeah, just a little bit looking forward. We have been on a trajectory of growing sales volumes, and we will continue that trajectory at least as long as we have space to produce more. 1,300 tons in the first quarter, first half, we definitely expect a higher volume in the second half. At the same time, especially now that there is less pressure on selling small fish and we're doing very good on our large-sized fish, we expect a certain amount of price recovery in the months to come. We continue, of course, to work very hard with our marketing department on telling our message, getting our fish out to all the corners of Europe, building up our distribution network further, all to reach the high-end Horeca segment as best as we can.
We are also working now that we are in a comfortable situation with biomass, we can really focus again on maximizing our biological performance. I think we are right now being successful in that. We will see, hopefully, but I expect to see lower feed conversion rates, faster growth, which both of those will significantly help our cost of production. So, I really think we are on a track for continuous improvement, and we will reach, as Jean-Charles said, positive EBITDA in the nearby future, probably in early 2026. With that, as a last thing, of course, as announced a month ago, I will be retiring, or at least partially retiring. As of the end of this year, the board has started the search for my replacement, which we hope to be in place by the end of the year.
Then I will indeed retire at the end of the year, but until that date, I am fully committed to improving things and growing things in this company and work hard to get us to positive EBITDA as fast as we can. But there will be further announcements on my successor, I think, later in the year. With that, I think we can open up for questions. Is it by chat, or is it by?
If you'd like to ask a question, you should be able to unmute yourself and ask the question.
Please go ahead. If that doesn't work, please try the chat box. I'm not seeing any questions coming forward. I do indeed hope that there were no questions, then we have had some issues with that in the past.
One question.
Yes?
Vincent, Jean-Charles, good afternoon. Thank you for the presentation. Just one question. In the annual statements you were mentioning, there will be probably a covenant breach, and you were also mentioning a potential adjustment in the financial structure. Can you elaborate on this one also regarding the EBITDA postponement to turn around to positive?
Yes. So, it's possible that by the end of the year, we are slightly behind in terms of EBITDA covenant. We believe we will reach our EBITDA covenant also with a certain lag of one quarter, maximum two quarters. We've already started dialogue with some key finance partners who is, at this stage, not a source of concern on our side to be able to meet our financial obligation this year.
So, there will be some adjustments, but considering the fact that we are well on track on our plan, just with a slight delay, there is no real concern in terms of our capability to slightly amend the financing conditions and meet fully our financial obligations in the future. The good news also is that in terms of liquidity, we believe we have sufficient liquidity to continue growing the company until we are at full capacity.
Thank you.
Any other questions?
If not, then thank you very much, and we'll be in touch again early next year, correctly? At least with a presentation. And see you then. Thank you so much.