Major refinance deal for Grieg06 June, 2014 –
LEADING farmed salmon company, Grieg Seafood ASA, has entered into a major finance deal following a new loan agreement with Nordea and Danske Bank.
The Norwegian company, which also has interests in Scotland and Canada, has agreed to refinance its existing credit facilities, totalling 1,500-million Norwegian kroners (NOK) over a five-year period.
Around NOK 900-million of the total is a repaid loan and Grieg Seafood’s total credit limit has also been increased, with NOK 495 million being set aside for further growth of the company’s fish farming businesses which it says will lay down a solid financial foundation for the future.
An announcement said the terms reflect that the selected banks have confidence in Grieg Seafood. The refinancing is also a clear sign of the companys confidence in the future.
Accounts for the first quarter of 2014 revealed just two weeks ago greatly improved results driven by strong salmon prices. Earnings before interest and tax (EBIT) came out at NOK 140.1 million compared to NOK 51.1 million for the same period last year.
The company said seawater farmed production was up on last year due to higher water temperatures and improved fish health status.
In addition the company had substantially lower costs from its Scotland operations as well as some improvement from its activities in the north Norwegian zone of Finnmark.
In fact Grieg Finnmark expects to be awarded four green licences, which should see a four per cent increase in salmon production.
The company says that while prices remain strong it adds there could be some reduction later in the year.
Grieg expects to harvest 69,000 tonnes this year while production for the second quarters of 2014 is expected to rise by about 3,000 tonnes, with Scotland accounting for most of the increase.