Norway Royal Salmon closes 2021 with 23% increase in operating revenues

Fish farm salmon round nets in natural environment Loch Awe Arygll and Bute Scotland UK
Fish farm salmon round nets in natural environment Loch Awe Arygll and Bute Scotland UK

Norway Royal Salmon closes the 2021 fiscal year with operating revenues of NOK 5800 million, an increase of 23% compared to 2020. Operating EBIT, meanwhile, increased by 40% from last year to NOK 344 million. The net profit after tax was NOK 693 million. A result undoubtedly favored by the figures obtained in the last quarter of the year, when NRS reported an operating EBIT of NOK 102 million and an EBIT per kg of NOK 9.43, compared to NOK 17 million and NOK 5.05 reported in the same quarter last year.

As with other companies, in the case of Norway Royal Salmon, the increase in demand during the fourth quarter has also favored these results, as their interim CEO, Klaus Hatlebrekke, admits: "Demand for salmon increased during the fourth quarter and into the first quarter of 2022. With a very strong demand and expectations of a decline in global harvest volumes in the first half of 2022, this provides the basis for a very positive market view for salmon in the future".

Klaus Hatlebrekke, NRS interim CEO. Photo: Norway Royal Salmon.

Biological challenges

After the biological problems experienced by the company in Iceland in the first quarter of 2022, Hatlebrekke claims that the situation is currently stable: "In the first quarter of 2022, Arctic Fish experienced biological challenges at two sites. Our skilled employees have made a great effort to handle the situation in the best possible way. The situation is now considered to be stable".

Doubtlessly, the future of the company lies precisely in those biological challenges referred to by the NRS interim CEO. "The production of fish delivered from the new smolt facility and the phasing out of triploid fish over the next years are expected to lead to a decrease in production costs in the coming years. We are pleased that the production at our new smolt facility in Dåfjord has been good, which will ensure NRS smolt from the second quarter", he says.

In 2021, the group's total harvest volume was 49,640 tons, but, after the problems experienced, a decrease to 45,100 tons (35,000 in Norway and 10,100 in Iceland) is expected for 2022. However, recovery is forecast for 2023 when the group's total harvest volume is expected to be 63,000 tons (50,000 in Norway and 13,000 in Iceland).

Sustainability, in the short, medium and long term

Sustainable salmon production is fundamental to NRS's long-term economic value creation. This is accepted by Klaus Hatlebrekke, who has emphasized it in his statement.  "NRS achieved the following three ESG ratings from the CDP for 2021; score A- and is classified as one of the leading companies for both supplier involvement in climate change and management of deforestation risk in our supply chain and score B for handling climate change. Although we are only at the beginning of our journey towards a low-carbon economy, we are pleased to see that our efforts so far were rewarded with good scores", he declares.

Norway Royal Salmon is a Norwegian fish farming company owned by NTS ASA group, whose acquisition by SalMar was announced a few days ago. NRS owns 36,085 tons MAB for salmon farming located in Troms and Finnmark, Norway, and 17,800 tons MAB for salmon farming and 5,300 tons MAB for trout farming in Iceland through the company Arctic Fish. In addition, NRS offers salmon to the market through its own sales organization.

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