Salmar achieves record high Q4 harvest following NTS takeover

Norway is a pioneer in offshore aquaculture. Pictured: Ocean Farm 1 of SalMar Aker Ocean, the world's first offshore salmon farm. Photo: SalMar.
Norway is a pioneer in offshore aquaculture. Pictured: Ocean Farm 1 of SalMar Aker Ocean, the world's first offshore salmon farm. Photo: SalMar.

SalMar has reported its quarterly results for the first time since acquiring NTS, Norway Royal Salmon (NRS) and SalmonNor. The 2022 acquisitions swelled a portfolio which already included operations in Norway, Iceland and Scotland. SalMar now ranks as the world's second-largest salmon producer, according to CEO Frode Arntsen.

Reporting the results for the fourth quarter, SalMar announced a Q4 total operational EBIT for the group of NOK 1,006 million, while the total harvest was 62,700 tonnes (NOK 16.05 per kg). For 2022 as a whole, harvest volume totalled 193,700 tonnes with an operational EBIT of NOK 4,465 million and operational EBIT per kg of NOK 23.05.

The record-breaking harvest volumes were partly due to the new acquisitions, but the company also recorded high harvests from Icelandic Salmon and strong results from its farms in Northern Norway. These were offset by biological challenges in its central Norway facilities and SalMar's Scottish subsidiary, Scottish Sea Farms.

"Our committed and highly skilled employees have continued to deliver solid operational performance, but due to biological challenges it has been a quarter with mixed results for the group. The biological challenges in Central Norway were handled well event though it had negative effects in the period", said Arntsen.

"We have never delivered as much salmon to customers all over the world as we have done in 2022, this has resulted in a good financial result for the full year which is driven by strong operational performance and strong demand of salmon with consequently increased salmon prices", he continued.

Salmon tax an ongoing cause for concern for SalMar in 2023

The company said it will continue with its plans to invest NOK 2.1 billion in 2023 in already-sanctioned pojects. However, it added that all new investments have been halted due to uncertainty surrounding Norway's proposed ground rent tax, the so-called "salmon tax".

Globally the atlantic salmon supply growth is predicated to be low in 2023, but due to SalMar's acquisitions, the company says it expects "significant volume growth", keeping its volume guidance for Norway and Iceland at 243,000 tones and 16,000 tonnes respectively, but reducing guidance to 37,000 tonnes for Scotland. During the first quarter of this year, SalMar says it expects significantly lower volumes than in Q4 for 2022, despite a similar cost level.

"We see a large and untapped potential for improvement and growth in all parts of our business, not least in within our existing licenses. In the fourth quarter we have also implemented the operational structure for "new" SalMar in Norway, and we will during 2023 optimize our operations to take advantage of the potential we see in the acquisitions we have made," said Arntsen.

This year may also see a possible sale of Frøy ASA, as SalMar performs a strategic review of its ownership of the salmon farming infrastructure company, which it says has attracted "strong incoming interest". SalMar's board of directors has resolved to propose a dividend at the same level as in 2021 of NOK 20.00 per share for the financial year 2022.

About SalMar

SalMar is one of the world's largest and most efficient producers of salmon. The Group has farming operations in Central Norway, Northern Norway and Iceland, as well as substantial harvesting and secondary processing operations. In addition, the company is operating within offshore aquaculture through the company SalMar Aker Ocean and SalMar owns 50% of the shares in Scottish Sea Farms Ltd.

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