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Hofseth Biocare ASA : Fourth Quarter 2015 Financial Report

During the fourth quarter, Hofseth BioCare laid plans for a reorganized and more effective sales process as well as an expansion of the Midsund plant.
Hofseth BioCare ASA had operating revenues of NOK 26.7 million in the fourth quarter of 2015, compared to 9.1 million in the fourth quarter of 2014.
The insurance claim after the breakdown of the steam boiler at the Midsund plant was settled for NOK 23 million, which is booked in the fourth quarter.
Operating EBITDA in the quarter was NOK 1.1 million. After write-down effects EBITDA was negative NOK 9.8 million, compared to negative 23.6 million in the fourth quarter 2014. Operating profit (EBIT) was negative NOK 16.3 million, compared to negative 28.2 million in the same quarter last year.
Cash flow from operations was NOK 48.9 million, compared to 8.9 million in the corresponding quarter last year. Cash and cash equivalents was at MNOK 28.9 by the end of the period.
"The quarterly numbers are not satisfactory. This is partly due to write-downs of inventory, but our market and sales activities have also progressed at a slower pace than we had expected. We are now taking action to improve this," said Jon Olav Ødegård, CEO of Hofseth BioCare ASA.
During the first half of 2016, the company will utilize more of the organization in an effort to boost sales. So far, the two key products have been OmeGo(TM) and ProGo(TM) in terms of hours spent by the sales department. However, as the planned factory expansion is completed, the PHP protein and CalGo(TM) will emerge as products with improved product qualities. Hofseth BioCare aims to re-launch these improved products in the global market space with a more targeted approach. The steps taken will utilize internal resources in a more effective way to increase the overall sales push. These measures are already implemented in the organization.
The factory expansion project at Midsund is the biggest endeavor for Hofseth BioCare in 2016. The goal of this expansion is to improve the product quality of ProGo(TM), PHP and CalGo(TM). For all these products, we expect to see positive effects in both volumes sold and pricing. Especially for ProGo(TM), we are excited to see the market's response to this new generation product.
Whilst continuing the strong focus on research and development of attractive finished products, the company has commenced a cost reduction initiative in a bid to reduce inventories and consequently warehouse costs through bulk sales to ingredient producers. This initiative is also intended to generate a more stable cash flow, which in turn will support the further development of the company.
Please see HBC's Q4 2015 report attached.
For further information, please contact:

Jon Olav Ødegård, CEO of Hofseth BioCare ASA
Phone: +47 936 32 966
About Hofseth BioCare:

Hofseth BioCare is a Norwegian biotech company that offers high-value ingredients and finished products for humans and pets. The company is founded on the core values of sustainability, traceability and optimal utilization of natural resources. Through an innovative hydrolysis technology, Hofseth BioCare is able to preserve the quality of salmon oil, proteins and calcium, prepared of fresh salmon off-cuts. Hofseth BioCare's objective is to contribute to the efficient use of marine resources and deliver quality products for ingredients and finished consumer products in the nutrition market.
This information is subject to the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.

Q4 2015 Financial Report


This announcement is distributed by NASDAQ OMX Corporate Solutions on behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Hofseth Biocare ASA via Globenewswire


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