Profit warning at NRS

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Trondheim-based grower Norway Royal Salmon late on Friday sent out the bad news that the company has had the virus infectious salmon anemia, or ISA, confirmed at grow-outs where ISA had earlier been suspected.

Fish retrievals from those sites began as soon as the they tested positive for ISA.

In the fourth quarter of 2017, the company processed 7,300 tonnes in its Norwegian Region North and 1,700 t from its Region South grow-outs for a total of 9,000 t, including 1,600 t from the infected sites. NRS had earlier estimated processed volumes for 2018 of 43,000 t.

Expedited processing from sites with ISA means that estimated processed volumes for 2018 are now adjusted downward by 500 t to 42,500 t. What remains of the biomass from sites with ISA is expected to be slaughtered in January 2018 and comprise 2,800 t.

So, company third-quarter EBIT will bear a loss (costs higher than corresponding earnings) related to the ISA event. That loss will be influenced by high production costs as a result of low average weights, high process and wellboat costs and costs for the destruction of fish in grow-out, along with a lower achieved price due to that lower average weight.

There’s also a fee to pay in the aftermath of an ISA outbreak, and so total one-time costs in the fourth-quarter of 2017 are estimated at about NOK 55 million (EUR 5.68 million).