A 17 percent increase in the harvest volume led the Scottish Salmon Company (SSC) to record net operating revenues of GBP 111.8 million (USD 135.1 million, EUR 123.2 million) for the first-half of this year, up from GBP 98.3 million (USD 118.3 million, EUR 108.4 million) in the corresponding period of 2018.
As well as achieving a salmon harvest of 18,463 metric tons (MT), SSC increased its exports, which accounted for 67 percent of sales compared with 59 percent in H1 2108. With a volume of 15,044 MT, North America – a key target market – grew its share of the total revenue to 14 percent, or GBP 15 million (USD 18.1 million, EUR 16.5 million), which the company highlighted as “significantly greater” than the 9 percent share of revenue reported in the full year results to 31 December 2018.
Increases were also seen in its sales to Europe and the Far East.
“In the first half of the year, we delivered record revenues of GBP 111.8 million, despite a softening in market conditions and contending with localized operational and biological events that impacted production in Q2. Over the long-term, the aim remains to deliver steady and sustainable growth. We remain on track to achieve our target volume of 33,000 MT by the year-end and 45,000 MT by 2025 with planning consent being obtained for two sites,” Craig Anderson, CEO of SSC, said.
“Our ongoing investment strategy continues to demonstrate results and support increased production. As we achieve greater scale, we continue to make significant investments in site development, operational capacity, biological innovations and infrastructure,” he added. “The full benefit of this investment cycle will be realized going forward, ensuring we take advantage of an increasing share of global market potential as the demand for our Scottish salmon continues to grow.”
Also in the first-half 2019, the company’s earnings before interest and taxes (EBIT) before fair value adjustment was GBP 31.4 million (USD 38 million, EUR 34.6 million), down from GBP 33.2 million (USD 40.1 million, EUR 36.6 million) in H1 2018, while its EBIT-per-kilogram fell to GBP 1.70 (USD 2.06, EUR 1.87).
While it recorded good growth in the six-month period, SSC’s operations were impacted by two mortality events in the second-quarter – an algae bloom that partially affected a site in the west coast of Scotland and a localized health challenge at a site in the Hebrides.
Looking ahead, planning consent has been obtained for the expansion of a site on the Isle of Gigha, which will represent a net increase in consent of 1,900 MT and will come on stream in late 2020. The company has also been granted planning permission for a new site in the North with an additional 2,000 MT consent. It has also further developed its Applecross freshwater facility.
Last month, SSC launched new brand “Tartan Salmon” to boost its exports to Japan, another target market.
Photo courtesy of Scottish Salmon Company.
