Grieg Shetland sees harvest and prices increase

Grieg Seafood Shetland

GRIEG Seafood has reported good price achievement at its Shetland operation during the start of this year.

Announcing its 2020 first quarter results today, Shetland produced a harvest of 2,047 tonnes, up from 1,788 tonnes a year ago. And it achieved an EBIT or operational profit per kilogramme of NOK 6.80 compared with a LOSS of NOK 13.93 in Q1 2019.

Grieg said the price improvement, however, had been set against reduced superior quality but offset by currency effects, adding:

‘Initiatives to improve biological performance, including more robust smolt, has increased the 12-month survival rate to 88 per cent (85 per cent in 2019). (There were) high sea lice pressure and treatments during the quarter, but also underlying cost improvements year-on-year.’ The company expects a second quarter harvest of 3,900 tonnes and a 17,000 tonne total for the whole of 2020.

Globally, Grieg announced higher revenues along with a 24 per cent increase in harvest volumes – up from 14,800 tonnes to 18,360 tonnes – during the quarter with a total EBIT (earnings before interest and tax) of NOK 240 million (£19-million) compared with NOK 267 million (£21m) in Q1 2019. The report says there were positive developments in British Columbia as well as Shetland. It expects a global harvest of 100,000 tonnes for 2020. Revenues rose by 25 per cent to NOK 2,055 million (£162m).

But as with every salmon farming business, Coronavirus affected results towards the end of the quarter. Chief executive Andreas Kvame said:

‘The first quarter of 2020 took a dramatic turn when the Covid-19 pandemic hit. Our top priority in this situation is the safety and wellbeing of our employees, their families and the local communities where we operate.

‘Safeguarding people, operations and partnerships are key priorities going forward, as well as protecting the financial solidity and flexibility of the Group. We also will continue to execute on our ambitions. We hold on to our target of 100 000 tonnes harvest in 2020. By 2025, we aim to harvest at least 150,000 tonnes of Atlantic salmon, to achieve cost leadership and to reposition Grieg Seafood in the value chain. In the first quarter, we took an exciting first step on this growth journey by acquiring Grieg Newfoundland AS.

‘Lastly, but most importantly, despite the extraordinary situation, we do not yield in our commitment to sustainable and responsible farming. Sustainability is our license to operate and remains at the heart of our strategy and all our activities.’