Investments in a feed facility and weakened prices overseas cut into the Marine Harvest Group’s profits in Q3 this year compared to the same period in 2011, according to the company’s latest financial report.
Profits dropped from NOK 457 million (USD 79.1 million, EUR 61.2 million) in 2011 to NOK 73 million (USD 12.6 million, EUR 9.8 million) in 2012, with cash flow also falling, from NOK 269 million (USD 46.6 million, EUR 36.1 million) in Q3 2011 to NOK 237 million (USD 41 million, EUR 31.8 million) this year. Cash flow from operations dropped from NOK 269 million (USD 46.6 million, EUR 36 million) to NOK 237 million (USD 41 million, EUR 31.8 million) compared to Q3 2011.
Profits per kilogram dropped in Norway, but remained profitable in the Americas, but the profits per kilogram in Canada remained in the red, at NOK -5.95 (USD -1.03, EUR -0.80), compared to NOK -7.97 (USD -1.38, EUR -1.07) in 2011. In Chile, profits per kilogram went from NOK 6.02 (USD 1.04, EUR 0.81) in 2011 to NOK -2.54 (USD -0.44, EUR -0.34) this year.
“We are struggling in Chile and Canada due to the exceptional low market prices in the Americas,” said CEO Alf-Helge Aarskog. “We are continuing to benefit from the cash flow measures implemented last year, and our balance sheet is therefore very strong.”
Aarskog also cited investment in a new feed facility in Norway as a reason for overall profit reductions, but added the he expected a significant return on that investment.
“This is an important step in transforming Marine Harvest into an integrated protein company,” he said. “We expect an attractive return on the investment, and it will contribute to more stable earnings. This is a natural part of the value chain as feed represents about 50 percent of our costs. The investment will also balance the current unfavorable situation of few feed suppliers operating at full capacity.”
