Profit warning from Grieg Seafood

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Poor Q1 for Grieg Seafood Finnmark.

The Grieg Seafood Group harvested a total of 18,362 tonnes gutted weight equivalent (GWT) of salmon in Q1 2020, some 1,500 tonnes above the company’s earlier harvest guidance.

“We have had more biological challenges than usual in the Finnmark region during the quarter. As communicated in the Q4 2019 report, Finnmark experienced unusual prevalence of winter-ulcers on fish in one of our production areas, reducing fish welfare and harvest quality. This situation persisted throughout the first quarter, resulting in significant downgrades which impacted achieved prices negatively,” Grieg writes in an annoucement Friday afternoon.

“While the situation is temporary, we are working systematically to identify why this incident has occurred and will put in place measures to avoid future occurrences.”

“In addition, a large portion of the harvest came from one site infected by infectious salmon anemia (ISA). Direct costs related to ISA handling and lower average weight from accelerated harvesting, increased cost per kilo and further reduced achieved prices.”

Combined, these issues resulted in significant earnings decrease for Grieg Seafood Finnmark, reporting an EBIT/kg of NOK 4.56 in Q1 2020, compared to EBIT/kg of NOK 25.01/kg in Q1 2019.

Operations in the other regions were in line with expectations during the quarter and according to plan.

Harvest volume,and preliminary EBIT/kg:

  • GSF Rogaland 6,944t/NOK 24.50
  • GSF Finnmark 6,827t/NOK 4.56
  • GSF BC 2,543t/NOK 16.00
  • GSF Shetland 2,047t/NOK 4.97

These numbers are preliminary, and Grieg Seafood will report final figures in their Q1 2020 report. This will be released on 7 May.