Profitability Analysis for Microalgae Cultivation in Finland - Case Company: Redono Oy
Kaur, Romanpreet (2021)
Avaa tiedosto
Lataukset:
2021
All rights reserved. This publication is copyrighted. You may download, display and print it for Your own personal use. Commercial use is prohibited.
Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-2021053112879
https://urn.fi/URN:NBN:fi:amk-2021053112879
Tiivistelmä
The objective of this bachelor’s thesis was aimed on researching and analyzing the profitability of microalgae cultivation from an economic point of view. There is a growing interest and demand in the field of cultivating microalgae. Therefore, in this thesis au- thor decided to focus mainly on the cultivation of BioAlgae unit for the commissioning company named Redono Oy, based in Finland and founded in year 2017, which uses side streams from industrial waste for the development of organic liquid fertilizers in or- der to produce high-value organic foods for agricultural innovation in the future.
The thesis is divided into different sections. It started by presenting the theoretical framework which included the necessary literature related to management’s accounting and key indicators which are important for profitability analysis. Different methods of performing the analysis were also discussed. The study was carried out through a desktop research to gather theoretical knowledge and characteristics of the production of microalgae and also qualitative research was carried out with the company’s CEO through a semi-structured interview to take an insight into the company’s needs and ex- pectations. This has helped the author a lot throughout the research in analysing the company’s needs and in creating a personalized excel file based on the tubular photo- bioreactors cultivation model that could assist the commissioning company in various investment decisions regarding coming microalgae cultivation projects. The company’s management and staff will be the potential users of the study and excel file.
Profit and loss analysis were conducted using different pricing scenarios to assess the profitability of whether to invest in a microalgae cultivation unit. The analysis scenario was based on the reactor volume of around 2 700L, using tubular photobioreactors. This scenario was based on the extraction of the high-value red pigmented astaxanthin from Haematococcus pluvialis. The result showed the estimated annual production for astaxanthin could be around 200 kilograms. The production cost of one kilogram of ex- tracted astaxanthin was calculated to be 346,22€ and would be profitable if sold for more than 500€ kilogram dry weight. Analysis showed the estimated investment around 200 thousand euros with return on investment of 3,63% and payback period of 9,1 years. The study showed that if the algae is sold as high-value product, the investment will be profitable.
This research would satisfy the requirements for a bachelor’s degree thesis, to have practical unity in business life, and to assist the author to achieve international experi- ence by conducting research of this type and scope.
The thesis is divided into different sections. It started by presenting the theoretical framework which included the necessary literature related to management’s accounting and key indicators which are important for profitability analysis. Different methods of performing the analysis were also discussed. The study was carried out through a desktop research to gather theoretical knowledge and characteristics of the production of microalgae and also qualitative research was carried out with the company’s CEO through a semi-structured interview to take an insight into the company’s needs and ex- pectations. This has helped the author a lot throughout the research in analysing the company’s needs and in creating a personalized excel file based on the tubular photo- bioreactors cultivation model that could assist the commissioning company in various investment decisions regarding coming microalgae cultivation projects. The company’s management and staff will be the potential users of the study and excel file.
Profit and loss analysis were conducted using different pricing scenarios to assess the profitability of whether to invest in a microalgae cultivation unit. The analysis scenario was based on the reactor volume of around 2 700L, using tubular photobioreactors. This scenario was based on the extraction of the high-value red pigmented astaxanthin from Haematococcus pluvialis. The result showed the estimated annual production for astaxanthin could be around 200 kilograms. The production cost of one kilogram of ex- tracted astaxanthin was calculated to be 346,22€ and would be profitable if sold for more than 500€ kilogram dry weight. Analysis showed the estimated investment around 200 thousand euros with return on investment of 3,63% and payback period of 9,1 years. The study showed that if the algae is sold as high-value product, the investment will be profitable.
This research would satisfy the requirements for a bachelor’s degree thesis, to have practical unity in business life, and to assist the author to achieve international experi- ence by conducting research of this type and scope.