Price of fresh Scottish salmon bites into high end seafood firms’ earnings

News
371

Loch Fyne Oysters – which supplies smoked and fresh salmon (and other seafood) to Michelin restaurants, as well as retailers Selfridges and Globus – is under pressure from fresh salmon pricing and rising staff costs. Though it will continue “sourcing salmon from a single Scottish source with provenance guaranteed”.

Based from Loch Fyne, Argyll, Scotland, the company – which started the Loch Fyne Oyster Farm in 1978 – posted its latest results for the year ended October 2018.

Overall the group results show a pre-tax-loss of GBP 763,300 (2017 – GBP 528,400) on a group turnover of GBP 16.4 million (2017 was GBP 15.6 million).

Loch Fyne Oysters’ turnover was GBP 15.5 million in 2017 and GBP 16.3 in 2018. 2017’s EBITDA was GBP 130,000 and 2018’s was GBP 150,000.

The company wrote: “Gross margin continues to come under pressure from fresh salmon pricing and increasing staff costs. Competitors are willing to source salmon from outside Scotland gaining a cost-benefit. Loch Fyne Oysters has resisted this and will continue with its strategy of sourcing salmon from a single Scottish source with provenance guaranteed. Pricing pressure is expected due to this but quality and integrity are maintained which will bear fruit in the longer term. Labour costs have increased as we have required to be more competitive in a reducing labour pool”.

The company added that it had started trading with the USA for the first time in 15 years – which is part of its growth strategy for the next five years.

Loch Fyne Managing director Cameron Brown when into more detail telling Herald Scotland that it faced – and will continue to do so – competition from rivals who are prepared to import salmon from markets outside of Scotland.

Brown said: “The competition is really quite tough. We are insulated to some degree [because] we are at the very top-end but we are up against guys happy to buy Norwegian, [and] Faroese [salmon].

“Some of them smoke them in Scotland. Some of the them are smoked in England and are sold on the market as Scottish smoked salmon.”