Norway Royal Salmon posts 282% increase in operational EBIT

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Salmon farmer’s Q3 Operational EBIT was EUR 13 million, up from the EUR 3.4 million last year. Its struggling Region South business sold in September was treated as an entity held for sale in the third quarter reporting.

In a press release today, Norway Royal Salmon (NRS) posted its latest figures with an operational EBIT of EUR 13 million for the third quarter of 2019 and EBIT per kg of EUR 1.79. Corresponding figures for the same quarter last year were EUR 3.3 million and EUR 2.2 per kilo.

Weak result Region South
“The Group’s main operations in Region North contributed with stable and good performance on harvested fish, while Region South had a weak result in the quarter. NRS shall grow through sustainable growth, the Group increased its biomass in the sea by 32 % during the quarter and plans to increase the biomass further in the fourth quarter,” said CEO Charles Høstlund.

Region South has set back the salmon farmer in the past. PHOTO: NRS

The Norwegian salmon farmer added that investments in Arctic Offshore Farming and a new smolt facility, as well as the buildup of biomass in the sea, resulted in an increase in net interest-bearing debt in the quarter to EUR 92 million.

The sales business sold 24,736 tonnes salmon during Q3, which is “66 % higher than in the corresponding quarter last year,” it wrote.

Region North and Region South
Region North posted an operational EBIT of EUR 13.8 million in the quarter, compared with EUR 5.3 in the corresponding quarter last year. Operational EBIT per kg gutted weight was EUR 1.96 million compared with EUR 2.27 in the corresponding quarter last year.

The struggling business of West Norway, Region South posted an operational EBIT of EUR – 367,000 in the quarter, compared with EUR 178,000 in the corresponding quarter last year. Operational EBIT per kg gutted weight was EUR -0.8 compared with EUR 1.8 in the corresponding quarter last year.

The estimated number of smolt put to sea in 2019 is 12.1 million, of which 10.1 million in Region North and 2.0 million in Region South.

Entity held for sale
“The strategic assessment of the Group’s operations in Region South was completed with a signed sales agreement on September 26 with an enterprise value of MNOK 1 240. The transaction is expected to be completed in December 2019. Region South has therefore been treated as an entity held for sale in the third quarter reporting,” it added.

NRS harvested 7 513 tonnes gutted weight in the quarter, which is 203 % higher than in the same quarter last year. 7 076 tonnes of the total volume were harvested in Region North and 437 tonnes in Region South.

It added that this year, estimated harvest volume is 31 000 tonnes. In 2020, it will be 37,000 tonnes, an increase of 32 per-cent compared with the volume of Region North in 2019.