Low prices hurt Lerøy Seafood Group

 Norwegian company Lerøy Seafood Group has once again fallen victim to low farmed salmon prices, according to the second-quarter financial results announced today.

 The company had a turnover of NOK 2.3 billion (USD 393.4 million), on par with the same quarter in 2011.Lerøy’s operating profit (before fair value adjustment of biomass) for the quarter was NOK 137.7 million (USD 23.5 million), up from NOK 103.2 million in the first quarter of 2012 but down from NOK 440.3 million (USD 75.3 million) in the second quarter of 2011.

 Leroy attributed the operating profit decline to lower farmed salmon and salmon trout prices, but indicated that production costs have reduced slightly due to lower feed prices and good product growth rates that have produced record-high harvest volumes for the season.

 The group’s second-quarter profit was NOK 123.4 million (USD 21.1 million), up from the first quarter’s NOK 89.4 million (USD 15.2 million) but down compared to NOK 439.3 million (USD 75.1 million) in profit the same period last year.

 Lerøy’s associated company Norskott Havbruk (owner of Scottish Sea Farms Ltd.) had lower net earnings in the second quarter due to low prices and higher costs for released-from-stock products. Net earnings fell to NOK 7.5 million (USD 1.2 million) in the second quarter, down from NOK 17.7 million (USD 3 million) in the same period last year.

 Lerøy expects the global farmed salmon supply will decrease in the second half of 2012, as lower prices have boosted demand in the past year.


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