Record volumes hurt SalMar 3Q sales
Norwegian salmon farmer SalMar harvested 35,400 metric tons (MT) of salmon in the third quarter of 2012, 11 percent more than during the same time period last year — an all-time high for the company.
However, EBIT for the quarter was NOK 109 million (USD 19.1 million) compared to NOK 134 million (USD 23.5 million) during the same quarter last year. Salmon prices were on par compared to the third quarter of 2011, so the company partially attributes the earnings decrease to favorable fixed-price contracts boosting the result for the third quarter last year.
The fish farming segments SalMar Central Norway and SalMar Northern Norway can point to reduced costs and improved operating margins compared with the previous quarter. The Rauma segment's results were weakened by the fact that part of its harvested volume had been infected with pancreas disease (PD).
The sales and processing segment achieved mixed results. While InnovaMar posted stable margins and a high volume of harvested fish, the sales business's profit margins were negatively affected by challenging market conditions.
“We have harvested a record-high volume during the quarter, and the global market growth has been as high as 19 percent compared to the corresponding quarter in 2011. The overall volume growth in the industry is making the situation challenging for our sales business," said CEO Yngve Myhre. “Yet despite this we are posting good results for the quarter, and the improvement in underlying costs in SalMar Central Norway and SalMar Northern Norway shows that we are on the right track.”
SalMar expects to harvest 104,000 MT in 2012 and expects a 10 percent increase in 2013 to 115,000 MT.