Faroe Islands-headquartered salmon farmer Bakkafrost Group has advised that preliminary results of the unaudited consolidated accounts for the second-quarter 2023 indicate a lower-than-expected operational earnings before interest and taxes (EBIT).
It disclosed that an operational EBIT of around DKK 353 million is expected for the period, compared with DKK 587 million in Q2 2022.
In a statement, it said the main drivers for the results are the extraordinarily low harvest volumes in the Faroese farming segment and the reduced average weight of the harvested fish.
Additionally, the Scottish farming segment had lower harvest weights in Q2, compared to the previous quarter, primarily caused by biology-led harvest at some sites and early harvest at some sites to reduce biological risk ahead of Q3.
“In general, price achievements for fresh salmon have reduced during the quarter. The low harvest volume in the Faroese farming segment harmed the cost of harvested fish as fixed costs were less diluted on the harvest volume,” it said.
Furthermore, exceptional mortality costs were recorded in the quarter. In the Faroes, this amounted to around DKK 32 million and covered seawater as well as freshwater, where accident-driven mortality events occurred during the start-up of the new expansions of the Glyvradal and Norðtoftir hatcheries.
In Scotland, DKK 43 million has been expensed caused by accident-driven mortality during the start-up of the Applecross 4 hatchery expansion and due to elevated mortality caused by viral deceases at some marine farming sites, as previously disclosed in Bakkafrost’s 2023 Capital Markets Day presentation.
Bakkafrost has revised the 2023 full-year harvest volume for the Faroe Islands to 63,000 tonnes. The 2023 full-year harvest volume for Scotland is unchanged at 30,000 tonnes HOG.
Its full Q2 2023 report will be released on 22 August 2023.
