SalMar chief upbeat on solid Q3 performance

Gustav Witzøe

Fish farming giant SalMar today unveiled a third quarter operating profit (EBIT) of NOK 748 million (£64m) up from NOK 647m (£55m) in the corresponding quarter last year.

The harvest volume was 52,100 tonnes, which gives an operational EBIT per kilo of NOK 14.35 (£1.22).

However, the results are at least NOK 150m (£12m) lower than many industry analysts were expecting.

But this doesn’t seem to have bothered CEO Gustav Witzøe who said: “We are particularly pleased with the results from farming in the quarter, and as always, there is good and solid operation on the salmon’s conditions combined with good craftsmanship from our employees who have made this possible.

“This quarter, we also took large and important strategic steps that will enable SalMar to grow further.

“We have completed strategic acquisitions in the value chain, we are in the process of completing our new process plant in the north, and we have initiated cooperation with Aker, which will strengthen our focus on sea-based farming.”

SalMar is co-owner of Scottish Sea Farms where biological issues due to gill health and higher mortality costs affected results.

The operating income rose from NOK 543m (£46m) last year to NOK 771m (£66m) this quarter. However the operational EBIT or profit dropped from NOK 101m (£8.6m) in Q3 2020 to NOK 80m (£6.8m) this time.

SalMar’s share from Scottish Sea Farms after tax was NOK 7m (£600,000) against NOK 46m (£4m) a year ago. On a brighter note. Scottish Sea Farms is expected to deliver a harvest of 46,000 tonnes next year, provided UK competition authorities approve the acquisition of Grieg’s Shetland business.

The Central and Northern Norway segments continue to deliver solid results driven by consistently good biological performance and solid craftsmanship from employees. In the third quarter, performance is particularly good from northern Norway with significantly lower cost levels than before.

Sales and industry have had high activity throughout the quarter, but increased costs in connection with logistics and other input factors weaken the result in the quarter.

SalMar said its Icelandic Salmon business continues its positive development from the previous quarter with good underlying operations, but lower spot prices and non-recurring costs related to brand and product development weaken the result.

CEO Witzøe. Concluded: “SalMar has considerable flexibility to realize our growth strategy and we continue our strategic investments along the entire value chain with undiminished strength both close to the coast and at sea.

“The measures and investments we are now making create the foundation for further environmental, quality and financial good results in the future.

For the first nine months of 2021, the SalMar Group delivered an operational EBIT of NOK 2,037m (£174m) compared with NOK 2,594m (£221m) over the same period last year.