Fish-health challenges led Norway Royal Salmon to harvest just 5,400 metric tons (MT) of gutted weight salmon in the first quarter of this year, down from 8,096 MT in the opening three months of 2019 and around half of the volume produced in the same period of 2018.
According to the Trondheim-headquartered company’s latest trading update, it faced challenges with winter wounds on some of its fish during the quarter. This resulted in quality downgrades on the fish harvested and reduced the price achieved. It also increased NRS’s production costs.
In addition, a significant proportion of the fish it harvested in the quarter came from an area which is subject to restrictions due to the presence of the fish disease infectious salmon anaemia (ISA), which resulted in higher well boat and harvest costs.
“The challenges of winter sores and harvest from an area subject to restrictions are temporary. The price achievement is also affected by half of the quarterly volume being harvested in March, when the price of salmon was at the lowest. Overall, this gives a lower result than expectations for the first-quarter of 2020,” the update said.
The company’s preliminary operational earnings before interest and taxes (EBIT) per kilogram for its farming and sales operations is NOK 16.50 (USD 1.56, EUR 1.44), compared to NOK 22.42 (USD 2.12, EUR 1.95) in Q1 2019.
The preliminary operational EBIT for the group is NOK 74 million (USD 7 million, EUR 6.4 million), down from NOK 164.3 million (USD 15.5 million, EUR 14.3 million) a year previously.
Its full Q1 2020 report will be released on 12 May.
Norway Royal Salmon has a maximum allowed biomass of 35,035 in Troms and Finnmark. It also has minority interest in three associated Norwegian fish farming companies which together own 11 fish-farming licenses, as well as Arctic Fish in Iceland that has licenses for 11,000 MT.
Photo courtesy of Norway Royal Salmon
