Whitefish markets normalized in the first quarter of this year after a challenging 2023, giving Reykjavik, Iceland-headquartered Iceland Seafood International’s (ISI) optimism for the rest of its 2024 performance, according to CEO Ægir Páll Friðbertsson.
In a statement accompanying the release of ISI’s Q1 2024 results, Friðbertsson said the upturn for whitefish was both “a welcome sign” and “a step in the right direction” that the group can build upon. Additionally, Friðbertsson said “the burden” of ISI’s U.K. operation, which it sold to Danish value-added seafood producer Epersen in August 2023, is fully behind the company, allowing it to focus on optimizing high-performing sectors.
However, economic forecasts indicate continuing uncertain conditions in ISI's primary trading countries. Specifically, salmon prices were higher in Q1 2024 than forecasts had assumed, leading to a downturn in ISI's sales of the species.
“If the forecasts for salmon prices are met, prices should decrease in the third quarter,” Friðbertsson said. “Our focus in the short term has been to improve the operation of existing business units and the company's capital structure and review the company's strategy. We know we have great potential to grow and make more of our company network and ... highly skilled team of seafood professionals. The objective is to strengthen Iceland Seafood further to meet its future challenges and opportunities."
ISI recorded sales of EUR 113.8 million (USD 123.4 million) in Q1 2024, down 8 percent on the same period last year. Its normalized profit before tax increased EUR 900,000 (USD 976,000) to EUR 1.9 million (USD 2.1 million).
Sales within its Value-Added Southern Europe (VA S-Europe) segment totaled EUR 55.8 million (USD 60.5 million), down 16 percent on Q1 2023, while its normalized pre-tax profit was EUR 2.1 million (USD 2.3 million), up EUR 1.1 million (USD 1.2 million) year over year.
At EUR 13 million (USD 14.1 million), ISI's Value Added Northern Europe (VA N-Europe) quarterly sales were about equal to Q1 2023, while the segment’s loss before tax in the period was EUR 100,000 (USD 108,000), compared to Q1 2023’s loss before tax of EUR 200,000 (USD 217,000).
ISI’s Sales & Distribution (S&D) division accrued sales of nearly EUR 49 million (USD 53.1 million) in the quarter, putting it on par with the segment’s performance in the year-ago period.
ISI said the early Easter holiday in 2024 affected sales in the month of March compared to March 2023’s record sales, while its production volume of Argentinean shrimp was lower than expected due to labor strikes.
Based on its first-quarter results and current trading, ISI is maintaining a normalized profit-before-tax estimate for its 2024 fiscal year at EUR 5 million to EUR 7 million (USD 5.4 million to USD 7.6 million). ISI said it expected cod prices will remain high until the fall, while salmon prices should come down in the second quarter and remain stable throughout the year.
“There are signs indicating a more balanced external environment. We expect all divisions to perform according to budget and do not foresee huge changes in the seafood sector in the coming months,” it said.
