Bakkafrost Group has unveiled a new DKK 2.2 billion (USD 335.6 million, EUR 295.9 million) investment strategy for the five-year period 2016 to 2020.
Within its plan, the Faroese salmon producer is to pump DKK 380 million (USD 58 million, EUR 51.1 million) into its fishmeal, oil and feed business, with investments to include a new salmon meal and oil plant.
More than DKK 1.1 billion (USD 167.8 million, EUR 147.9 million) will be invested in its smolt production, including bringing three new facilities on stream, and a further DKK 160 million (USD 24.4 million, EUR 21.5 million) will go its harvest/VAP operations, including funding the completion of its new factory at Glyvar.
The main focus of all these investments is to increase the company’s capacity.
Bakkafrost’s smolt investment, for example, will result in a capacity expansion of 600 percent and the aim is to produce 500-gram smolt to reduce mortality, which it believes could lead to a capacity expansion of up to 30 percent. The harvest/VAP expansion, meanwhile, will enable the company to ramp up its capacity from 60,000 metric tons (MT) to 100,000 MT head-on gutted (HOG).
In the first-quarter of this year, Bakkafrost delivered total operating earnings before interest and taxes (EBIT) of DKK 253.6 million (USD 38.7 million, EUR 34.1 million), up from DKK 235 million (USD 35.9 million, EUR 31.6 million) in the corresponding period of 2015.
The company harvested 10,934 MT of salmon in Q1 2016, an increase of 12 percent year-on-year. It expects to harvest a total of 48,000 MT of gutted weight salmon in 2016.
