Iceland shines for NRS, but Norway disappoints

Norway Royal Salmon today announced a first quarter operating profit of NOK 60m (£5m) during the first quarter of 2021, down from NOK 75m (£6m) a year earlier. The latest quarter’s profits were also appreciably lower than the NOK 87m (£7.46m) some industry analysts were expecting.

Although Arctic Fish, its recent Icelandic acquisition, performed particularly well, CEO Charles Høstlund made it clear he was not satisfied with some aspects of operations in Norway.

The operating profit or EBIT per kilo was NOK 6.4 (£0.55) against NOK 16.53 in Q1 2020 (£1.42).

Høstlund said: “This is the first quarter the Icelandic farming company Arctic Fish has been consolidated into the NRS group.

“Arctic Fish had a very good development in production costs and the company is harvesting more and more salmon. It is a growing company, and harvest volumes are expected to increase substantially in the coming years. Recently, Arctic Fish was awarded new licences, which will support the company’s future growth ambition to harvest 24,000 tonnes by 2025.”

But the CEO said he was not satisfied with farming operations in Norway, particularly in relation to production costs which were showing too much variation between the best and worst sites.

He concluded: “In the first quarter, the salmon price was significantly lower than in the same quarter last year, but higher than in the previous quarter. On the other hand, the price increased during the (this) quarter and has continued to increase after the end of the quarter.”

Farming Norway produced an operational EBIT of NOK 77.2m (£6.5m) against 89,4m (£7.6m) last year, while the operational EBIT in Iceland was up from NOK 14.6m £1.2m) to NOK 21.5m (£1.8m).

NRS said it expects to harvest 52,000 tonnes this year, 40,000 tonnes from Norway and 12,000 tonnes from Iceland.