Cermaq weak in ‘challenging’ 3Q

Norwegian fish farmer Cermaq reported negative earnings in 3Q 2014, but despite this CEO Jon Hindar remained optimistic with the impending buyout from Mitsubishi Corp.

“I'm confident that Cermaq as a part of Mitsubishi Corporation will be well positioned to grow and also benefit from the strengths and expertise of Mitsubishi Corporation,” Hindar said.

The company recorded earnings before interest and taxes (EBIT) as NOK -39 million (USD -5.9 million, EUR -4.6 million), compared to NOK 113 million (USD 17 million, EUR 13.4 million) recorded in the same quarter in 2013. The company’s earnings in Chile totaled NOK -84 million (USD -12.7 million, EUR -10 million) compared to NOK -1 million (USD -150,736, EUR -118,696) the previous year. In Norway EBIT was also down compared to 3Q 2013, at NOK 66 million (USD 9.9 million, EUR 7.8 million) compared to NOK 102 million (USD 15.4 million, EUR 12.1 million) last year, but it remained in positive territory.

“We are definitely not satisfied with the financial results this quarter,” Hindar said. “Beyond reduced prices in all regions from Q2 and significantly lower volumes in Norway and Canada, the disappointment is mainly linked to a continued high cost level for Atlantics and trout in Chile.”

The company pointed to salmon rickettsia disease and sea lice, which have damaged their operations in Chile. The company also blamed its overall losses in part on declining sales prompted by the Russian trade ban against Western countries, which has cut off seafood exports from countries such as Norway to Russia.

Mitsubishi made an offer to buy out Cermaq back in September, and earlier this month a commanding number of shareholders accepted.

“The takeover by Mitsubishi will create the second largest salmonid farmer globally, and significantly strengthen Cermaq's resource base, downstream capacity and market access in the fast growing Asian market,” Hindar said.