Aquaculture giant Cermaq has reported an EBIT pre fair value of NOK 215 million (€22.7 million/$35 million) for the second quarter of this year based on strong results in all parts of the company’s operations.
All of Cermaq's operations experienced improved results, driven by strong market prices on salmon in all markets, good biological performance in farming and considerable increase in volumes in the feed business.
“I am pleased with the results for both Mainstream and EWOS. The strong salmon market gives especially strong profitability for Mainstream,” said CEO Geir Isaksen.
EWOS delivered an increase in volume of 12% from second quarter 2009, driven by growth in Norway and Chile.
Continuations of existing contracts and new customer relations have strengthened EWOS' market position in 2010.
“The strong volume growth in EWOS has a significant impact on our results. EWOS' product range provides strong biological performance and good fish health for the farmers, and this is the basis for further growth in EWOS,” said Isaksen.
Mainstream delivered an EBIT pre fair value of NOK 174 million (€22 million/$28.3 million) in the quarter compared to NOK 32 million (€4 million/$5.2 million) in the same quarter last year.
The sales volumes were 16,600 tonnes which was a decrease from second quarter last year. This decrease is entirely attributed to not being able to repeat last year's significant sales of frozen salmon from Chile.
Mainstream Chile delivered an EBIT pre fair value of NOK 1.2 million (€151,634/$195,349) for Q2.
The harvesting of salmon transferred to the sea after the ISA crisis will start in August. The transfer of smolt of Atlantic salmon in this quarter reached 1.5 million. The total transfer in 2010 is expected to be 6 million Atlantics smolt which is somewhat lower that previously estimated.
This reduction is due to Cermaq’s strict quality standards for usage of eggs, the company said.
Mainstream Norway experienced a volume increase of 38% from same quarter last year, driven by increased volumes from Finnmark. EBIT pre fair value was NOK 103.4 million (€13.1 million/$16.8 million) for Q2, corresponding to NOK 16.30 (€2.06/$2.65) per kg. EBIT pre fair value for the same quarter of last year was NOK 33.6 million (€4.2 million/$5.5 million).
Mainstream Scotland delivered an EBIT pre fair value of NOK 10 million (€1.3 million/$1.6 million) against a loss of NOK 5.9 million (€746,165/$961,634) in the same quarter last year. The improvement comes from strong salmon prices and restructuring of the operation in 2009.
Mainstream Canada delivered an EBIT pre fair value of NOK 59.5 million (€7.5 million/$9.7 million) compared to NOK 47.3 million (€6 million/$7.7 million) in Q2 last year.
Salmon prices in the US were record high in the early part of the quarter, but fell significantly towards the end of the quarter. At the same time, salmon prices in the US are still high.
Overall, salmon prices are expected to remain strong in 2010 and into 2011.
Expected sales volume for salmon, trout and coho for second half of 2010 are relatively unchanged from the previously communicated estimates, said Cermaq.
Sales volumes are expected to increase by 9% in 2011 from 2010 driven by Chile. EWOS enters the peak season in second half year, and increased volumes are expected foremost in Norway and in Chile with further growth in 2011.
