The SalMar Group on Friday turned in “weak” first-quarter results, the outcome of a 33 percent increase in the global salmon supply and a poor biological performance.
The Norwegian company reported gross operating revenues of NOK 811.7 million in the first quarter 2012, compared with NOK 1 billion in the same period in 2011. Its operational EBIT fell to NOK 43.4 million in 2012 from NOK 292 million in 2011.
Also, SalMar took on non-recurring costs of NOK 40 million in association with a site in Troms where an PD virus outbreak forced the company to led harvest of the entire stock of around 2.1 million salmon. The company assumed an additional NOK 5 million in non-recurring cost following the identification of PD at a site in central Norway.
“Our first-quarter results were weak,” said SalMar CEO Yngve Myhre. “As previously announced, this can be attributed to weak biological performance on the part of the 2010 generation, which has affected the results in all segments. With regard to the harvesting of entire fish stocks where the PD virus has been identified, SalMar will through 2012 and 2013 largely compensate for the loss of this harvesting volume by increasing its exploitation of released MAB at other locations. This may be achieved at a low marginal cost, thus recovering a portion of the financial loss. Despite low volumes operating efficiency at InnovaMar was good. The harvesting department is on course to achieve our goal of harvesting 110 fish per minute. With higher volumes in the second half, the secondary processing department will be able to exploit its capacity much better.”
He continued: “We are very pleased to have successfully concluded several strategically important agreements during the first quarter. The harvesting and processing collaboration with Lerøy will safeguard both volumes coming in to InnovaMar and SalMar Nord’s harvesting capacity. The acquisition of 10 production licences in Finnmark gives us a substantial growth potential in the Troms/Finnmark region. The renegotiated borrowing agreement and the addition of new equity provides us with a financial platform for the realization of further growth.”
SalMar harvested some 20,744 metric tons of salmon (gutted weight) in the first quarter of 2012, and it expects to produce about 120,500 metric tons this year.
