Reduced activity dampens Bakkafrost result

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This Q3, the Faroese fish farmer reported an operating profit of EUR 22.5 million based on 7,217 tonnes of harvest volume.

Operating profit was 11-12 percent lower than analysts’ pre-tips according to Sparebank1 Markets.

“The activity in the third quarter this year has been somewhat lower, compared to the same quarter last year. The quarter has also been affected by the elevated mortality level at farming site A-81 Kolbanagjógv in September, which resulted in higher costs and a negative effect on next year’s harvest volumes. Despite challenges and a decreasing salmon price in the quarter, the operational result for the Group was DKK 168 million* for the quarter,” commented Bakkafrost CEO, Regin Jacobsen.

Bakkafrost reduced its expected harvest volume for 2018 from 49,000 tonnes to 46,000 tonnes.

“The new harvest factory in Vágur, Suðuroy, was delayed in start-up, compared to the timetable, but we now look forward to see how the increased activity in Suðuroy will be, after the harvest factory started operation in October,” Jacobsen continued.

Farming activities contributed most to operating profit to the sum of with EUR 14.6 million. The employment division achieved an operating profit of EUR 293.5 thousand. Havsbrún – the feed side of the division – reached a total of EUR 4.3 million (EBITDA).

The company is cash heavy with EUR 32 million in its coffers. Equity ratio was 70 % at the end of the quarter.

Bakkafrost said that it expected supply to be “tight” next year.

“The supply of Atlantic salmon will be tight in 2019, as global supply in 2019 is estimated to increase around 4%, compared to estimated supply in 2018.”

Bakkafrost is the largest fish farming company in the Faroe Islands and the eighth largest fish farming company in the world.

* EUR 22.5 million.