Kaldvík is currently Iceland's largest salmon producer in terms of licenses.
Photo: Kaldvík.
Kaldvík presented its Q4 2024 results this week. The former Ice Fish Farm - renamed 2024 - had a substantial revenue increase of more than 43% over the same quarter last year, however, the biological incidents recorded in the period overshadowed the strong performance of the Icelandic fish farmer.
In the fourth quarter of 2024, Iceland's largest salmon company experienced a substantial increase in revenues reaching EUR 46.8 million, which is EUR 14.2 million or 43.55% more than the EUR 32.6 million in Q4 2023.
However, as it already reported in the harvest guidance update at the end of January - in which it cut its harvest forecast for 2025 by 14% -, during the period, the company experienced difficulties in its marine operations, both related to the transport of smolts and to winter wounds caused by the lower-than-normal temperatures during the period. In addition, strong northerly winds in late November and early December caused 10-day delays in the harvest schedule, resulting in abnormally high losses.
The financial effect of the biological incidents in Q4 2004 and expected for Q1 2025 is reflected in the fourth quarter figures, which include a biomass write-down of EUR 23.1 million. Operating EBIT before fair value adjustment of biomass and production tax was EUR -18.1 million. Adjusted for the extraordinary depreciation of biomass, operating EBIT was positive at EUR 5.0 million, compared to EUR 4.6 million in the same quarter of 2023.
In terms of harvest volume, in the fourth quarter of 2024 it was 6,668 tons, an increase of 58.68% - 2,466 tons more - compared to the same quarter of the previous year.
"We are seeing positive effects from improvement projects that finalised this summer which enable us to increase the harvest volume significantly in November and December to an average of between 700 and 800 tonnes per week," the company claimed in its Q4 2024 report.
Such improvement programs involve, for example, by, in addition to vaccinating them against ISA, vaccinating all fish with a new winter injury vaccine designed specifically for conditions on the east coast of Iceland.
Moreover, measures have been taken at the facilities to mitigate operational risks and increase safety, such as increasing the capacity of the well boats, which guarantees the early release of smolts by 2025, or the introduction of improvements in capture and shipping operations.
"These strategic actions collectively strengthen biological risk management and ensure a more stable and secure production environment," Kaldvík's report explained.
The success of the measures ended up raising the total volume harvested in 2024 to 14,965 tons. Compared to 4,395 tons for the full year 2023, this was an increase of 240.50% - 10,570 tonnes -.
In addition to the profit and harvest data, the Icelandic salmon farmer reported that it has established an internal sales department focused on developing the U.S. and Asian markets.
"China and Iceland maintain a strong partnership to enhance trade between the two countries," Kaldvík claimed. "The long-term goal is to achieve an even distribution of trade across Asia, the U.S., and Europe. The Asian market grew by 12% in 2024 and is expected to continue its expansion in 2025. Additionally, air freight to China has become significantly more competitive due to the rise of e-commerce."
According to the Q4 2024 report, Kaldvík was able to sell 25% of its volume through fixed sales contracts in the U.S., which allowed it to obtain higher prices in the quarter.
"This is made possible by our unique certifications and environmentally friendly approach, ensuring the highest standards that our customers highly value," the company stated.
Likewise, Kaldvík recalled that it is still awaiting the processing of a license to operate at Seyðisfjörður, in the Eastern Region of Iceland, with a capacity of 10,000 tons (6,500 fertile tons).
In the Q3 2024 results presentation, the company said that it expected official government approval for this permit by early 2025, now, it has pushed back the expectation a bit by saying that the license is projected to be issued "during H1 2025."
Nevertheless, in case of delays, Kaldvík said it is prepared to use its current licenses to maintain its production and smolt supply by 2025, ensuring operational continuity and flexibility. The company currently holds licenses totaling 43,800 tons, which, as said, makes it Iceland's largest salmon producer in terms of licenses.
Finally, the Icelandic salmon farmer said that discussions regarding the acquisition of key assets in the fish farming value chain on Iceland's east coast are ongoing. As reported by WeAreAquaculture, the way in which the agreement for these acquisitions had been carried out caused dissent among some Board members.
Such disagreement was evidenced by the departure from the Board of Aðalsteinn Ingólfsson and his replacement by the former director of Lerøy Aurora and the Norwegian Seafood Council (NSC), Renate Larsen, who was elected by approximately 66.93% of the votes, evidencing the division on the Kaldvík Board.
