Benchmark Holdings PLC on Monday launched a strategic review that could result in the sale of all or parts of the company, saying its share price undervalues its business and prospects.
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Benchmark is based in Worthing, on the south coast of England. It is an aquaculture genetics, nutrition and health business that helps salmon, shrimp and other fish farmers to breed fish, provide early-stage nutrition, and fight sea lice.
Management actions over the last three years have delivered substantial revenue growth and improvement in profitability and cash conversion.
Since FY20, Benchmark's revenue from continuing operations has grown from £105.4m to £169.5m in FY23 and Adjusted EBITDA has increased from £15.5m to £35.5m.
The company is well positioned with a strong balance sheet and significant headroom to grow within its existing markets, as well as multiple potential avenues for expansion.
For the full year ended 30 September 2023, Benchmark delivered 7% revenue growth1, 15% increase in adjusted EBITDA and improved its operational cash conversion from 35% to 58%, demonstrating continued progress in the year despite challenging conditions in the shrimp sector, one of the company's core markets.
The Board believes that the current share price materially undervalues the combined value of Benchmark's businesses and the long-term prospects of the company, which may at least in part be due to the tightly held and illiquid nature of its ordinary shares.
As a result, having consulted with the company's major shareholders, the Board has unanimously decided to undertake a formal review of the company's strategic options including, but not limited to, a sale of the company as a whole or alternatively the potential sale of one or more individual business units, to establish whether there is a bidder or bidders prepared to offer a value for the company or its individual business units that the Board considers attractive relative to the Board's view of intrinsic value. ■
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