High salmon prices helped Norwegian fish farming and fishing company Leroy Seafood Group (LSG) achieve revenues of NOK 4.9 billion (USD 584.9 million, EUR 556.8 million) in the fourth quarter of 2016, up from NOK 3.6 billion (USD 429.7 million, EUR 409.1 million) in the same period of 2015.
LSG’s operating profit before fair value adjustment of biomass for the last quarter exceeded NOK 1 billion (USD 119.3 million, EUR 113.7 million), compared with NOK 353 million (USD 42.1 million, EUR 40.1 million) in Q4 2015.
"In 2016, Leroy Seafood Group achieved a record high result, and can report the highest revenue and highest operating profit before fair value adjustment of biomass in the group's history," LSG CEO Henning Beltestad said.
"We can look back on a quarter with extremely high salmon and trout prices, strong demand but also some biological challenges and a relatively high share of contracts at prices below the spot price," Beltestad said.
Compared with Q4 2015, the group's volume of harvested salmon and trout was down by 6 percent to 39,143 metric tons (MT).
For the full year 2016, LSG reported revenue of NOK 17.3 billion (USD 2.1 billion, EUR 2 billion), an increase of 28 percent compared with the previous year. Operating profit before fair value adjustment of biomass was NOK 2.8 billion (USD 334.4 million, EUR 318.3 million), compared with NOK 1.4 billion (USD 167.2 million, EUR 159.1 million) in 2015, while profit before tax and fair value adjustment of biomass was NOK 2.9 billion (USD 346.4 million, EUR 329.7 million), compared with NOK 1.3 billion (USD 155.3 million, EUR 147.8 million) in 2015.
It harvested a total of 150,182 MT of salmonids in 2016.
Beltestad said that 2016 had been a “very exciting year” for LSG and that with the recent acquisition of Havfisk and Norway Seafoods, it had embarked on “a new journey.”
The aim is to integrate whitefish into LSG’s value chain, he said.
“We are now a fully integrated company and have control of our entire value chain for a wide range of seafood products, from the sea to the plate, and we are very much looking forward to continuing with our market and product development."
Beltestad highlighted that the most important cost drivers for LSG’s salmonid production remain feed costs and the costs required to remain in compliance with statutory limits for salmon lice.
"We have implemented a number of measures and expect to see a reduction in production costs for salmon and trout, but have to acknowledge that it is difficult to specify a timeline for such a development," Beltestad said.
