Omega Protein Corporation (NYSE: OME), the nation's leading producer of Omega-3 fish oil and specialty fish meal products, today reported net income of $2.0 million ($0.11 per share) for the second quarter of 2010, compared with net loss of $3.3 million ($0.18 per share) for the second quarter of the previous year.
Revenues for the quarter ended June 30, 2010 were $36.3 million compared with revenues of $41.8 million for the comparable quarter in 2009. Omega Protein recorded operating income of $3.8 million for the second quarter of 2010, versus operating loss of $3.9 million for the second quarter of 2009.
The Company's 2010 second quarter results, in comparison to the second quarter of 2009, primarily reflect increased fish meal and fish oil sales pricing of 45% and 10%, respectively, offset by decreased fish meal and fish oil sales volumes of 38% and 23%, respectively. The increased fish meal sales pricing coincides with limited global availability of fish meal experienced during the first half of 2010. The decreased fish meal sales volume was the result of carrying less fish meal inventory into 2010 as compared to 2009.
For the six months ended June 30, 2010, the Company recognized revenues of $68.6 million, compared with $71.9 million in revenues for the first six months of 2009. Omega Protein recorded operating income of $6.1 million for the six months ended June 30, 2010, versus operating income of $0.4 million for the comparable period a year earlier. The Company had net income of $3.0 million ($0.16 per share) for the six months ended June 30, 2010, compared with net loss of $1.2 million ($0.06 per share) for the six months ended June 30, 2009.
During the six months ended June 30, 2009, the Company received a federal hurricane assistance grant of $2.7 million from the State of Mississippi, net of fees, related to the impact of Hurricane Katrina, which occurred during 2005. Excluding this grant from the results of operations, net loss for the six months ended June 30, 2009 would have been approximately $3.4 million ($0.18 a share).
The Company's 2010 results for the three and six months ended June 30, 2010 also include losses of $0.6 million resulting from the Deepwater Horizon oil spill disaster. The losses are attributable to the recognition of idle facility costs at the Company's Moss Point, Mississippi, facility due to the temporary interruption of fish processing at this facility which resulted from fishing ground closures.
Federal and state closures of fishing grounds resulting from the Deepwater Horizon oil spill have continued to affect the Company's ability to operate its Gulf of Mexico fishing fleet. In response to these closures, the Company temporarily suspended operations at its Moss Point, Mississippi facility and relocated its nine Moss Point fishing vessels and three carry vessels to fishing grounds on the west side of the Mississippi River Delta in an attempt to minimize vessel downtime and business interruptions. The Company has also temporarily ceased fishing with certain vessels from time to time. The Company expects that it will continue its response plan of moving vessels and temporarily suspending operations of some vessels until these fisheries closures are terminated or otherwise reduced to a point where the Company is no longer affected. The Company cannot predict how long it will be necessary to follow its response plan or the effect of the oil spill on the Company's business, operations and fish catch, both short-term and long-term.
Subsequent to June 30, 2010, the Company filed a claim with BP and also met with BP's third party claims adjuster. The Company is seeking reimbursement from BP for lost fish meal and fish oil production resulting from the fishing area closures, and the additional costs incurred by the Company to mitigate lost fish meal and fish oil production. To date, the Company has not received any reimbursement or recorded any receivables related to its claim against BP.
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