SATISFACTORY RESULT DESPITE BIOLOGICAL CHALLENGES
Rising prices through the period and high harvested volumes produced a good result for SalMar in the fourth quarter 2014. Operational EBIT ended at NOK 509 million in the period, NOK 71 million up on the preceding quarter, and NOK 160 million higher than in the same period in 2013.
"SalMar deliveres yet another profitable quarter. We still face biological challenges associated with PD and salmon lice, with the impact on costs that this entails, but we have the situation under control and are working ceaselessly to improve the company's operations," says SalMar's CEO Leif Inge Nordhammer.
Gross operating revenues came to NOK 2 billion in the quarter, up from NOK 1.8 billion in the fourth quarter 2013. The increase is due to a higher volume of fish harvested, which ended the period at 41,700 tonnes, compared with 34,100 tonnes in the corresponding period in 2013. The price of salmon averaged NOK 39.09/kg in the quarter, down NOK 2.93/kg from the fourth quarter the year before
Operational EBIT/kg came to NOK 12.21 in the quarter, up from NOK 10.20/kg in the fourth quarter 2013. In the third quarter 2014 Operational EBIT stood at NOK 12.01/kg.
However, in terms of operational development, there are substantial variations between the different regions. While operations in Central Norway, and the Rauma segment in particular, are affected by biological challenges, profitability in Northern Norway has returned to satisfactory levels.
In the Sales and Processing segment, productivity in the harvesting and processing departments was generally good during the quarter. Around 50 per cent of the volume harvested in the fourth quarter 2014 was sold under contract at prices marginally higher than the average spot price for the period. Furthermore, a generally good allocation of volumes sold at spot prices contributed to better margins for the segment.
From a performance point of view 2014 was an very good year for SalMar. High salmon prices and record high harvested volumes generated substantial earnings for the Group. The board considers SalMar's financial position to be very good, and is recommending a dividend of NOK 10 per share.
Based on estimates of the standing biomass at the close of the year, it is expected that the global supply of Atlantic salmon will rise by just three per cent in 2015. This would normally indicate relatively good prices moving forward. Despite the loss of sales to the Russian market, SalMar is experiencing buoyant demand in the company's core markets.
In 2015 SalMar expects to harvest around 139 000 tonnes in Norway. Norskott Havbruk (Scottish Seafarms) is expected to harvest some 31 000 tonnes in 2015.
A complete report for the fourth quarter 2014 is attached.
For further information, please contact:
CEO Leif Inge Nordhammer
Tel: + 47 916 85 250
CFO Trond Tuvstein
Tel: + 47 918 53 139
Email: trond.tuvstein@salmar.no
Web: www.salmar.no
This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.
