Grieg Seafood can’t make money from today’s prices, posts negative EBIT of €1.6 million

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Disrupted markets with low spot prices impacted earnings.

Grieg Seafood posted its Q4 results on the Oslo Stock Exchange with earnings hit due to a “significant shift in demand and lower prices in core markets due to the pandemic”.

Revenue was EUR 113 million, a decrease of 20 per-cent compared to Q4 2019. Grieg said that the decrease was mainly due to the lower spot prices in Norway, resulting in a EUR -10.4 million drop in revenue.

EBIT was EUR -1.6 million during the quarter, compared to EUR 34 million the year before. This corresponded to an EBIT per/kg of EUR -0.07, a drop from EUR 1.4 compared to Q4 2019.

“Overall, 2020 has been a challenging year. We did not deliver on our ambitions, not only because of Covid-19 but also due to biological challenges in several regions. We have taken important steps to remedy the situation. We have strengthened our operational capabilities with a new and more farming oriented organizational set-up, and with a potential sale of our Shetland operations, we are narrowing our focus to Norway and Canada as strong production regions. We have also started our journey to take a stronger market position with a new and integrated sales and marketing organisation,” said Grieg CEO Andreas Kvame.

Grieg Seafood harvested 20,271 tonnes of salmon in the quarter, almost 4,000 tonnes lower than guided, due to ISA trouble in Finnmark.

2020 harvest volume was 71,142 tonnes, below its guidance of 75,000 tonnes (excluding Shetland) due to ISA challenges in Finnmark, Norway. It expects to harvest 80,000 tonnes (again, excluding Shetland) in 2021.

Due to the increased volatility and uncertainty caused by the Covid-19 situation, combined with an extensive investment plan, the Grieg board decided to postpone the ordinary dividend for 2020.

The company entered the new year with a 28 per-cent contract share of salmon sales.