Bakkafrost delivers almost double earnings in the first quarter of 2022

Bakkafrost delivers almost double earnings in the first quarter of 2022

The Bakkafrost Group delivered a total operating EBIT of DKK 418 million almost double compared to the previous year (DKK 224M) in Q1 2022 and made a profit of DKK 405 million.

"Despite disappointing results in our Scottish farming operation, we are pleased to see clear improvements during this quarter, following the challenging biology and high mortality we had in Q3 and Q4 2021," CEO Regin Jacobsen said.

Bakkafrost has implemented many changes in the Scottish farming operation, including a new farming strategy. The benefits from this are gradually emerging because of a new farming strategy.

Besides, he added in a statement: "In Q4 2022, we also expect the finalization of Applecross 4 expansion. This will enable us to be self-sufficient with high-quality smolt of significantly larger size than today. This will be the first major milestone in transforming the Scottish farming operation."

Despite the disruption in global supply chains which has strengthened the need for local
sourcing, "Bakkafrost is in a good position as around two-thirds of our sourcing is from local suppliers. Also, we have good access to locally caught marine raw material for our feed production," he confirmed.

On the other side, the long-term goal of the Board of Directors is that 30-50% of earnings per
share shall be paid out as a dividend. According to the company, its financial position is strong. Further, a solid balance sheet, a competitive operation, and available credit facilities.

Looking forward

Furthermore, Bakkafrost explained how new hatcheries will increase the total production capacity up to around 18 million smolts of around 500g in 2026. In Q1 2022 the average weight of released smolt in Scotland was 102g, which is 15% higher than in Q1 2021. In 2022 the average weight of the released smolt in Scotland should be around 120g.

Bakkafrost will build 3 large energy-efficient hatcheries in Scotland, enabling the implementation of Bakkafrost's large smolt strategy and giving an annual production capacity above 18 million smolts at 500g. Having large smolt in Scotland will transform the performance, lower the biological risk and increase harvest volumes. In addition to building hatchery capacity.

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