Higher harvest volume and strong prices drive up Scottish Salmon Company’s earnings

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Growth all round for SSC.

The Scottish Salmon Company posted its latest quarterly results in a financial statement on Friday.

The company said that: “Fourth quarter revenue up 6 per-cent and EBIT/Kg up 20 per-cent year-on-year driven by higher harvest volume and strong prices.”

Revenue for the fourth quarter of 2018 was GBP 42.5 million (Q4 2017: GBP 39.9 million).  Revenue per kilo also increased to GBP 6.03/kg in the quarter (Q4 2017: GBP 5.80/kg), driven by overall continued strong prices.

EBITDA grew 13.2 per-cent from Q4 2017 to Q4 2018. The salmon farmer harvested 7,045 tonnes in the quarter, bringing 2018’s harvest to 29,913 tonnes – an 18.3 per-cent increase – slightly above the revised target of 29,500 tonnes.

Export volumes accounted for 61% of sales during the period, up from 58% in Q4 2017. SSC continues to develop overseas markets, particularly in North America and Asia, exports for 2018 were 58%.

Total capital expenditure was GBP 20.5 million in 2018, consisting of infrastructure investment in the new marine sites of Maaey and Portree as well as freshwater facilities and ongoing site improvement projects. In December, SSC acquired the Harris & Lewis Smokehouse in the Isle of Lewis.

The Scottish Salmon Company CEO Craig Anderson said:

“In the fourth quarter, we delivered record results driven by strong operational
performance across the value chain, good biological performance and a positive
market environment.

“Throughout 2018 we focussed on driving export growth. Our commitment to
Scottish Provenance and quality are key differentiators in the international
market place. Our brands, underpinned by this unique Scottish Provenance, have
contributed to our export achievements over the past 12 months. Lochlander
Salmon was successfully introduced into North America and Tartan Salmon Label
Rouge launched in France, growing our market share in these territories.
Developing our presence in North America and the Far East remain our focus.
While, like any business, we have been monitoring Brexit negotiations closely,
we have a global perspective and robust long-term strategy in place to support
growth.

“We made several investments to improve productivity and efficiency throughout
our value chain during 2018. These included; freshwater developments, the Native
Hebridean Family Breeding Unit, strategic site development as well as further
increasing our processing capabilities.

“Supporting this strategy is the recent acquisition of the Harris & Lewis
Smokehouse on the Isle of Lewis. Reinforcing our commitment to rural Scotland,
it will exclusively smoke Native Hebridean salmon and represents a milestone in
the development of this salmon. It complements the introduction of fresh Native
Hebridean salmon into a major UK retailer earlier this year.

“In 2019, we remain firmly focused on our strategic priorities, ensuring the
responsible growth of the Company as we bring the finest quality Scottish salmon
to customers worldwide”

The company declared a dividend of 0.57 NOK/share – at a 3.5 per-cent dividend yield.

Estimated harvest volume for 2019 is 31,500 tonnes and 7 per-cent cycle-on-cycle growth is forecast.