"The supply of whole salmon from Norway increased 38% in the quarter. This caused a significant drop in salmon prices during the first quarter," said Bakkafrost CEO Regin Jacobsen.
The Bakkafrost Group has released its results for the first quarter of 2025, reporting an operational EBIT of DKK 505m (EUR 67.7m / USD 76.7m), an almost 29% drop from the same period last year.
The decline in profits, the company said, was primarily due to significantly lower salmon prices, despite continued "strong biological performance" across its operations.
"Overall, we are satisfied with the results in this quarter," said CEO Regin Jacobsen. "Our Faroese freshwater and marine operations delivered another quarter of strong biological performance, reflecting robust growth, effective sea lice management, and consistent harvesting of large, high-quality fish."
"The supply of whole salmon from Norway increased 38% in the quarter. This caused a significant drop in salmon prices during the first quarter," Jacobsen explained.
In the Faroe Islands, Bakkafrost's revenues fell 12% year-on-year to DKK 1,403m (EUR 188.2m / USD 213.3m), and operational EBIT dropped 35% to DKK 435m (EUR 58.3m / USD 66.1m). The company's Scottish operations fared better, despite a revenue decline of 19% to DKK 496m (EUR 66.5m / USD 75.4m), operational EBIT rose by 82.1% to DKK 71m (EUR 9.5m / USD 10.8m) compared with last year.
Bakkafrost reports an overall harvest of 25,200 tonnes gutted weight (tgw), up almost 17% from the 21,557 tgw recorded in Q1 2024. In the Faroe Islands, harvests saw a 32.3% increase to 18,914 tgw, while Scotland’s harvest declined 13.5% to 6,286 tgw.
Meanwhile, the company's freshwater segment transferred 3.8 million smolts during the quarter, 3.2 million of which were in the Faroe Islands, with 600,000 transferred in Scotland.
In Bakkafrost's Fishmeal, Oil & Feed segment, raw material intake dropped 20% to 109,502 tonnes, while feed sales increased to 31,338 tonnes, up 16% from last year.
"The freshwater segment continues to excel, further improving our production efficiency with high-quality, large smolt, which positively impacts costs," Jacobsen stated.
"In Scotland, our strategic focus remains firmly on the successful transition to large, high-quality smolt at Applecross. We are steadily progressing in scaling up this production, which remains central to fundamentally transforming our Scottish farming operations and enhancing long-term sustainability and profitability," Jacobsen said.
"The Applecross and Skálavík hatcheries and the Havsbrún feed factory expansion are progressing according to plan. These projects remain critical to achieving our strategic objectives," he added.
Bakkafrost reiterated its forecast for a total harvest of approximately 97,000 tonnes in 2025, of which 77,000 tonnes is to come from the Faroe Islands and 20,000 tonnes from Scotland.
Regarding its strategic investments as part of its announced 6.3bn DKK investment plan for 2024-2028, Bakkafrost said it "has decided to change the priority of some of the investment projects in Scotland, including the second planned hatchery at Fairlie and new processing facility". This means the company expects to reduce its capex spending in for 2024-2025 by around DKK 800 million in total.
"The main purpose of the investments in Scotland is to replicate Bakkafrost's successful operation in the Faroe Islands. A part of this is to implement Bakkafrost's large smolt strategy in Scotland, which is achieved through building sufficient and energy-efficient hatchery capacity," the company said.
Bakkafrost will host its next Capital Markets Day on 16-17 June 2025 in the Faroe Islands.