Morpol’s processing arm came to the rescue in the fourth quarter of 2011, lifting the Poland-based salmon processor and farmer at a time of low salmon prices.
On Tuesday, the company’s processing arm reported operating earnings (before interest and taxes) in the fourth quarter 2011 of EUR 19.2 million, up from EUR 6.9 million in the corresponding period of 2010, resulting in an EBIT margin of 14.8 percent, up from 4.9 percent.
“I am pleased with the performance,” said Morpol CEO Jerzy Malek. “Processing delivered an Operational EBIT margin close to 15 percent, which is very good. Unfortunately, we had some challenges in farming in the UK. However, the underlying performance was acceptable given the low salmon prices.
Those low salmon prices resulted in operating revenues of EUR 150.2 million in the fourth quarter of 2011, down 12.9 million from in the same period in 2010. The company attributed the falloff in revenues mainly to a 6 percent drop in processing sales volumes as well as a significant drop in salmon prices, reducing revenues in farming.
However, operating earnings (before interest and taxes) in the fourth quarter of 2011 amounted to EUR 13.6 million, up EUR 6.9 million from the same period in 2010, thanks to an improved performance in processing, offsetting the falloff in operating profitability in farming.
The average spot price for Norwegian salmon in the fourth quarter of 2011 was NOK 23 per kilogram (ex-Oslo), compared to NOK 38 per kilogram in the fourth quarter of 2010.
Looking ahead, Malek said, “We are well positioned for good performance going into 2012 following our significant investments in processing and farming during 2011.”
