Marine Harvest again posts high earnings, even as salmon harvest declines

Marine Harvest reported more strong results in its quarterly report, delivered to shareholders of the publicly traded company on Thursday, 24 August.

The Norway-based salmon farming company achieved operational earnings before interest and taxes (EBIT) of EUR 197.9 million (USD 233.3 million) in the second quarter of this year on the back of strong prices. Up from EUR 149 million (USD 175.7 million) posted in the corresponding period of 2016, this was the second year in a row that the Norwegian-headquartered salmon farming company’s Q2 EBIT had reached a record level. 

“Driven by high salmon prices on strong demand, we achieved record high operational results in the second quarter. I am pleased to see strong operational performance and reduced cost in Marine Harvest Scotland and Marine Harvest Ireland. It is also encouraging to see that production costs decreased for Marine Harvest Chile,” said Alf-Helge Aarskog, CEO of Marine Harvest.

The company reported operational revenues of EUR 884 million (USD 1 billion) for the last quarter, up from EUR 832 million (USD 980.9 million) in Q2 2016. The total harvest volume in the quarter was 78,612 metric tons (MT) in the quarter, down from 87,159 in Q2 2016 and 104,158 MT in Q2 2015. 

As a result of biological issues in Norway, it has reduced its harvest guidance for 2017 by 26,000 MT to 377,000 MT.

In the second-quarter, salmon of Norwegian origin achieved an operational EBIT per kg of EUR 2.50 (USD 2.95), up from EUR 2.12 (USD 2.50) in Q2 2016. Salmon of Scottish and Canadian origin reported operational EBIT per kg of EUR 3.10 (USD 3.65) and EUR 2.34 (USD 2.76) respectively, with The Scottish EBIT up from EUR 0.47 (USD 0.55), while Canada’s EBIT was the same as last year. Salmon of Chilean origin reported operational EBIT of EUR 1.46 (USD 1.72) per kg in the quarter, an improvement from EUR -0.23 (USD -0.27). 

MH Consumer Products reported an operational EBIT of EUR 15.4 million (USD 18.1 million), up from EUR -4.8 million (USD -5.7 million) in Q2 2016, while MH Feed reported an operational EBIT of EUR 1.8 million (USD 2.1 million), down from EUR 3.3 million (USD 3.9 million).

“I am pleased that operational improvements in Marine Harvest Consumer Products have resulted in yet another good quarter. Several of our processing plants are now performing better than at the same time last year,” Aarskog said

According to its Q2 2017 results statement, salmon prices in all markets were higher in the last quarter than in Q2 2016 due to strong demand. In local currencies, the prices in Europe, Miami and Seattle were up by five percent, nine percent, and three percent year-on-year respectively.

Marine Harvest is currently working on staffing the newly established organization in East Canada, and is preparing a production plan and an investment framework. Smolt stocking is expected to commence in 2019, with the first harvests in 2020. 

Construction of its new EUR 110 million (USD 129.7 million) feed plant in Scotland is also progressing with completion expected in the second-half of 2018.


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