SALMAR today became the latest Norwegian salmon farming company this month to deliver higher profits and earnings on the back of increased prices and strong demand during both the final quarter of 2018 and for the full year.
The company announced a fourth quarter operating profit (EBIT) of 934.9 million kroner, up from NOK 707.2 million on the same period in 2017.
It reports ‘good’ operations from all its business areas, including Scottish Sea Farms in which it has a 50 per cent share. SalMar is proposing a dividend of NOK 23 per share.
Fourth quarter revenue from Scottish Sea Farms rose from NOK 485 million in 2017 to NOK 512 million last year, with operating profits up from NOK 115 million to NOK 158 million.
For the whole of 2018, income dropped slightly from NOK 2,088 million to NOK 2,057 million and the EBIT from NOK 669 million to NOK 661 million.
The harvest volume, however, fell from 8,100 tonnes to 6,700 tonnes during the quarter. Harvest volumes for the year were down by 3,500 tonnes to 27,500 tonnes, but SalMar said the business delivered good results during the final period.
Underlying operations were also good, resulting in high average harvest weights, strong prices and lower costs. Harvest volumes for Scottish Sea Farms are expected to total 30,000 tonnes this year.
Total group revenues for 2018 rose from NOK 10,817 million to NOK 11,342 million and the operational EBIT (profit) was up from NOK 3,162 million to NOK 3,460 million.
Both the company’s operations in Northern and Central Norway posted good operational results, although the central section had to deal with higher costs.
The company has also entered into an agreement to acquire a further 3,268,670 shares in its Icelandic subsidiary Arnarlax, with the intention of taking total control by buying the remaining 12 million plus shares.
However, the chairman of the Arnarlax board, Kjartan Olafsson, has said he plans to continue as a part owner in Arnarlax and will not sell his shares in response to the offer.
Speaking of the overall results, CEO Olav-Andreas Ervik said: ‘Strong demand and record high harvest volumes have contributed to another satisfactory quarter for the Salmar group.
‘A good operational performance from all our business segments, strong demand and our highest ever harvested volume have all contributed to another satisfactory quarter for SalMar. The first generation from Ocean Farm 1 was also harvested during the quarter.
‘The project’s biological results have been good and strengthened our confidence in fish farming further out to sea.
‘Our operations must be on the salmon’s terms and not on the equipment’s limitations. By continuing to invest in the entire supply chain, as well as further developing our ocean farming strategy, SalMar is building a strong platform for sustainable development and further growth.’
Picture: SalMar CEO Olav-Andreas Ervik