Grieg Seafood today unveiled an outstanding third quarter performance, with Shetland making a major contribution.

Putting its troubles behind it, the company announced a 45% jump in turnover to NOK 1,331m (£114m) from NOK 917m (£79m) this time last year.

EBIT (operating profit before production fee and fair value adjustment) was NOK 149m (£12.8m) against a loss of NOK 14m (£1.2m) a year ago. This, said Grieg, was mainly high due to high prices in British Columbia and lower costs.

Grieg said Shetland delivered a good performance with an EBITDA (earnings before interest, tax, depreciation and amortisation) reaching NOK 53m (£4.5m). The Shetland harvest this year will total 77,000 tonnes and 90,000 tonnes next year.

It said the UK competition authorities are expected to decide on the Shetland sale to Scottish Sea Farms by 15 December.

Grieg CEO Andreas Kvame said: “Thanks to the hard work of my colleagues across the company, Grieg Seafood has delivered one of our best third quarters ever.

“Biology has continued to improve and stabilise, with increased survival across the regions compared to last year. The market was surprisingly strong, considering the large volumes harvested in the industry during the quarter, which would normally cause lower prices.

“We are experiencing the advantage of an in-house sales and market organisation, which sold all of our fish for the second quarter in a row, and their work on integration between sales and production to optimize price performance.”

He continued: “Moreover, we have secured value-added processing capacity for part of our volume in Norway as a step towards repositioning the company in the market.

“Operationally, British Columbia was again a highlight during the quarter, with stable production and high average harvest weights.

“We continued the positive trend of reduced impact by harmful algae blooms. We experienced the full advantage of the region’s close proximity to a strong US market, where we achieved high prices.”

He said Finnmark (Norway) performed well, with good production, good fish health and welfare, and few biological challenges.

September marked the best production month the region has ever seen. Finnmark has taken measures to reduce the risk of winter ulcers during the coming winter, such as avoiding two winters at sea in the farming areas with the coldest temperatures.

Access to value-added processing capacity will also contribute to better price achievement should there be downgrades. But performance in Rogaland, Norway was impacted by downgrades caused by PD (pancreatic disease), affecting both cost and price achievement.

Grieg’s experience is that fish groups harvested after a shorter time spent at sea have a reduced risk of PD and need fewer sea lice treatments, strengthening confidence in the company’s post-smolt strategy.

The fish in Rogaland needed fewer sea lice treatments, continuing the positive trend from earlier years. Biology in the region stabilised towards the end of the quarter.

The fish in Grieg’s Newfoundland freshwater facility are growing well and on schedule.

CEO Kvame concluded: “Shetland continued to deliver a profit, as the region has done since the turn-around. The sale is expected to be approved by UK authorities during the fourth quarter.

“It will allow us to concentrate focus, resources and investments to our production regions with the most potential for profitable growth – Norway and Canada. Grieg Seafood’s focus on sustainability remains.”

 

 

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