“These are new orders coming mainly from Asia”, said the Canadian firm, which is planning to build a new production facility in China with joint venture partner Shanghai KaiChuang Deep Sea Fisheries Co (SKFC) to meet growing demand from the region.
New 300metric ton factory in China
The 300 metric ton facility should be fully operational by the end of 2014 or early 2015, said chief financial officer André Godin.
Under the deal, SKFC will supply the raw materials while Neptune will provide a license to the joint venture giving it the rights to use Neptune’s production technology in return for an upfront payment plus ongoing royalty payments.
Publicly listed SKFC, which is 43% owned by a Chinese government-owned fishing conglomerate, has a large fleet of vessels for krill harvesting in the Antarctic Ocean, which will secure supply to Neptune-SKFC Biotechnology as well as Neptune, said Neptune.
“Krill oil awareness in Asia, being greatly associated to Neptune's NKO as a premium reference of Omega-3, clearly confirms Neptune's brand's initial recognition in the Asian nutraceutical market.”
Sherbrooke phase three expansion plan to start in mid-2013
However, bosses are also expanding capacity at their facility in Sherbrooke, Quebec, to meet growing demand from North America and Europe, with phase three of plans to increase capacity from 300-500 metric tons now scheduled to begin in mid-2013 - instead of 2014, revealed Godin.
“Pursuant to commercial discussions at Vitafoods Geneva in May 2012, Neptune will initiate earlier than planned the third phase of its Sherbrooke plant expansion.”
Upon completion, Sherbrooke will be able to support around $80m in sales, said the company.