New post-smolt partnership and production capacity strategy, highlights of Andfjord Salmon's financial report

The Norway-based company has presented its fourth quarter and interim full-year 2023 financial results.
View of one of Andfjord Salmon's square inland pools in Kvalnes, Andøya, Norway.

View of one of Andfjord Salmon's square inland pools in Kvalnes, Andøya, Norway.

Andfjord Salmon

Andford Salmon has presented its fourth quarter and interim full-year 2023 financial reports which include a new collaboration with the ocean-based fish farmer Eidsfjord Sjøfarm/Holmøy Havbruk and a second use of the surplus pool to enhance production capacity.

In addition, the company's Kvalnes facility expansion is developing as planned. Consequently, it has reported no salmon production or revenue in the fourth quarter of 2023 and an operating loss of NOK 19.4 million in the fourth quarter of 2023, versus a loss of NOK 18.2 million in 2022.

Regarding all this, CEO Martin Rasmussen said: "We have worked on the post-smolt strategy for a long time and are delighted to present it to our shareholders today. It will bring substantial benefits to ocean-based fish farmers, the fish itself, the marine environment, the regional aquaculture industry, and Andfjord Salmon and is a valuable supplement to our production of human-grade salmon."

A second use of the surplus pool capacity

Andfjord Salmon confirmed that "significant surplus pool capacity" is produced after the release of smolt in the company’s pool. The aim is to take advantage of this extra capacity by releasing more smolt.

Then, when the fish reach an average weight of around 1 kilogram it will be sold as post-smolt to ocean-based fish farmers in the local region. This will usually happen after reaching a certain biomass density level after 5-7 months.

"In short, we are enhancing production capacity and income potential without adding additional infrastructure costs," indicated Rasmussen. This will enable 10% higher biomass turnover, which means an estimated 15-25% increase in EBIT.

Also, the company’s cash flow will improve "considerably" as it can generate sales revenue from post-smolt, in addition to income from the harvest of human-grade.

Andfjord Salmon and Eidsfjord Sjøfarm collaboration

On the other hand, the Norwegian company has partnered with Eidsfjord Sjøfarm/Holmøy Havbruk to provide post-smolt for near ocean-based farming locations as part of upcoming production cycles.

About this partnership, Rasmussen noted: "By collaborating on a post-smolt strategy, we can boost the environmental, biological, and economic development of the aquaculture industry in the Vesterålen region."

Andfjord Salmon is in contact with other local salmon farmers for future collaborations.

Four new pools at Kvalnes are on the way

In January, Andfjord Salmon confirmed that the excavation of the next 12 pool pits at Kvalnes, Andøya, was completed one quarter ahead of schedule.

Now, it is completing four new pools, which will amount to a total production capacity of 8,000 tonnes of HOG at Kvalnes in 2025.

Additionally, the company is expecting a total production capacity of 40,000 tonnes (HOG) at Kvalnes between 2025 and 2030.

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