Coronavirus means higher costs for world’s largest salmon farmer

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Extensive measures implemented at Mowi take toll.

In a financial update on the Oslo Stock Exchange, Mowi writes that while the machine is running more or less normally, the salmon farmer is incurring more costs than usual because of the Covid-19 pandemic.

Operational EBIT for the Group was approximately EUR 107 million in Q1 2020 (EUR 196 million in Q1 2019). Farming was EUR 101 million, sales and marketing EUR 14 million and its feed segment was minus EUR 1 million.

Mowi’s board also decided to postpone the decision on the first-quarter dividend until the second quarter.

Harvest volumes in Q1 2020 were:

  • Farming Norway 50.5 thousand tonnes
  • Farming Scotland 9.0 thousand tonnes
  • Farming Canada 8.0 thousand tonnes
  • Farming Chile 14.0 thousand tonnes
  • Farming Ireland 0.0 thousand tonnes
  • Farming Faroes 1.5 thousand tonnes
    Total 83.0 thousand tonnes

In connection with the presentation of the Q4 2019 results, Mowi guided a total harvest volume of 84 thousand tonnes for Q1 2020.

The contract share was 43 per cent in Norway and 75 per cent in Scotland in the quarter. Blended cost in the first quarter was 0.22 EUR/kg higher than in the fourth quarter of 2019 on 29% lower volumes.

“The Board considers it essential to maintain a strong financial position amid the heightened uncertainty caused by Covid-19. The situation is challenging for all and Mowi is no exception. While our operations have continued to run more or less normally so far, we are incurring more costs than usual due to extensive measures implemented internally and externally. We are monitoring the situation closely and are ready to take further measures if needed,” Mowi wrote.