Covid-19 hits Mowi as it post 45 per cent drop in EBIT

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World’s biggest salmon farmer impacted by falling prices due to pandemic.

In a post on the Oslo Stock Exchange, Mowi writes that its Q1 operational EBIT was EUR 109 million compared with EUR 196 million in the corresponding quarter of 2019.

It wrote that this was down to the impact from falling prices as “Covid-19 escalated into a world-spanning pandemic with extensive lockdown measures in most countries”.

“Despite Covid-19 currently causing substantial market and logistical disruptions, our operations are running close to normal. At the same time we are maintaining the safety and well-being of our employees. We will do whatever we can to keep operations running without compromising health and safety. I am extremely proud of all Mowi’s employees for making this possible,” said Mowi CEO, Ivan Vindheim.

Mowi reported operational revenues of EUR 885 million (EUR 979 million) in the first quarter of 2020. Total harvest volume in the quarter of 83 119 tonnes (104 118) was approximately in line with guidance. Harvest guidance for 2020 is unchanged at 450 000 tonnes.

“The Covid-19 situation significantly impacted trade flows, logistics and distribution during the quarter. The foodservice segment was particularly affected by measures imposed to contain the spread of the virus. Reduced
consumption within foodservice, however, was partially offset by increased sales through the retail channel.”

Despite a challenging quarter, both Mowi Consumer Products and Mowi Feed delivered all-time high volumes for a first quarter.

“Our integrated value chain has demonstrated resilience in these challenging times, and we have continued to produce value-added products at our many factories. We have been able to capitalise on long-term relationships with retailers globally, and have sold an increased share of production through retail,” added Vindheim.

“We have started to see easing of lockdown measures in some countries and signs of increased demand as a result. I strongly believe the demand for salmon will recover to pre Covid-19 levels as the foodservice segment gradually reopens as a result of this,” said the CEO.

The Board of Mowi has decided to postpone the decision on the first quarter dividend until the second quarter in light of heightened uncertainty due to the Covid-19 pandemic.