On Thursday morning, the salmon farming giant, Lerøy, presented its results for the final quarter of 2021. It appears that the operating profit before value adjustment has more than doubled, and was NOK 902 million (€90 million) in the fourth quarter of 2021, compared with NOK 441 million (€44 million) in the fourth quarter of 2020.
Strong demand for seafood, including better prices for the group’s main products, and improvement in underlying operating conditions are highlighted as important explanatory variables to the fact that earnings in all segments have been significantly raised from the corresponding period last year.
High activity
“The demand for seafood is strong, giving grounds for optimism about the future. There is a positive development in activity level and prices realised. Compared with Q4 2020, earnings have increased in all segments,” said CEO Henning Beltestad.
“For the year, we reach a turnover of 23 billion (€2.3 billion), which is clearly the highest in our history. Our vertically integrated value chain is strong, and the development is in line with the group’s growth strategy,” Beltestad continued.
During the period, 51,000 tonnes were harvested, compared with 48,000 tonnes in the fourth quarter of 2020.
Cost inflation
“We delivered a satisfactory quarter in terms of earnings in aquaculture. At the same time, growth in recent months has been somewhat lower than expected and we are reducing harvest guidance for 2022 for our aquaculture operations in Norway from 190,000 tonnes to 185,000 tonnes,” Beltestad continued. If Lerøy’s share in Scottish Sea Farms is included, the total will be 208,000 tonnes.
The board of Lerøy proposes a dividend of NOK 2.50 (€0.25) for the financial year 2021. With 596 million shares, there will be a total dividend of NOK 1.49 billion (€150 million).
Management and the Board still expect good underlying demand growth in the years to come. At the same time, the group is experiencing rising prices for important input factors, this will affect the cost development in 2022. It is nevertheless the board’s assessment that the group is well positioned for the coming year. The Board’s expectation, as of today, is that earnings in the first quarter of 2022 will be significantly better than in the first quarter of 2021 and correspondingly that earnings for the year 2022 as a whole are expected to be better than they were in 2021.
