Big jump in Bakkafrost Q1 profit as Scotland continues to improve

Bakkafrost today announced an increased 2024 first quarter operational profit or EBIT of 710m Danish kroner (£81.7m). The company said biological performance in Scotland is continuing to improve.

In fact the progress in Scotland meant that Bakkafrost was able to harvest superior quality large fish.

The group EBIT of DKK 710m compared with an EBIT of DKK 565m (£65m) in Q1 last year.

Revenue in the Faroe Islands increased by just over DKK 250m (£28.7m)  to DKK 1,594m (£183m) and resulted in an operational EBIT of DKK 671m (£77m) against an EBIT of DKK 410m(£47m)  in Q1 2023.

In Scotland the Q1 revenue was DKK 612m (£70m) down from  DKK 708m (£81.4m) 12 months earlier. The operational EBIT or profit was DKK 39m (almost £4.5m) well down on the Q1 2023 figure of DKK 155m (£17.8m) last year.

CEO Regin Jacobsen said the company was satisfied with the results, especially in the Faroe Islands: “Good biological performance in the Faroe Islands and improved biology in Scotland has enabled us to harvest large fish of superior quality and benefit from a salmon market marked with low availability superior quality and large fish.

“In Scotland the biology has been good at most sites, except for one site with fish previously weakened by a jellyfish encounter.”

CEO Jacobsen continued: “In our freshwater operation, performance and smolt quality is good in the Faroe Islands.

“At Applecross in Scotland, there have been some start-up issues in this quarter in parts of the facility, that has not yet been finally commissioned by Bakkafrost.

“This impacts the ramp-up pace of the overall smolt release this year and the average weights which are is now expected to reach 200g in Q4.

“As we continue to follow our de-risking strategy in Scotland, we plan to harvest around three quarters of the 2024 volume in H1 (2024 first half).”

In an upbeat note he added: “The outlook for the salmon market is tight and supportive for continued strong salmon prices in Q2, especially large salmon of superior quality, which both the Faroe Islands and Scotland are able to provide.”

The board has proposed a dividend of DKK 8.70 (just over £1).

Regin Jacobsen, Bakkafrost CEO