Grieg Seafood’s Q3 profits reduced by increasing production costs

The Group’s EBIT before fair value adjustment of biological assets was EUR 16.8 million during the quarter, compared to EUR 24 million in the same quarter of 2017.

EBIT per kg amounted to EUR 0.99 for the period, down from EUR 1.42 in Q3 2017, according to a press release from the company.

The Grieg Seafood Group harvested 16 941 tonnes of salmon in the quarter. The farming cost increased by EUR 0.12 per kg compared to the same quarter last year. This is mainly related to reduced survival towards the end of the quarter due to algae incidents in British Columbia and gill-related diseases on Shetland.

The current situation, with limited supply growth and strong underlying demand, is expected to continue. In addition, a rise in demand due to the Christmas season will most likely contribute to strong market prices for the last quarter of 2018, the company said.

The board of Grieg Seafood has resolved to distribute a dividend of NOK 2 per share according to proxy approved on the General Annual Meeting.

Grieg Seafood expects to harvest approximately 24 100 tonnes in Q4 2018, totaling 75 000 tonnes for the full year 2018, corresponding to an increase of 20% from 2017. Expected harvest volume for 2019 is 82 000 tonnes.

By 2020, Grieg Seafood aim to increase production to reach an annual harvest volume of 100 000 tonnes and a production cost at or below weighted industry average, targeting NOK 37.90/kg.