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Norway Royal Salmon (NRS) reports EBIT before fair value adjustment and non-recurring items of NOK 10.0 million for the first quarter of 2011, compared with NOK 35.7 million for the corresponding quarter last year.
The main reason for the reduced EBIT is the planned significantly lower harvest volume compared with the corresponding quarter last year. A non-recurring charge of NOK 2.5 million was recognised for the period, which represents the costs related to listing the company.
Profit attributable to associated companies totalled NOK 2.9 million in the fourth quarter, compared with NOK 7.0 million for the same period last year. The reason for the reduction in profit is the planned reduction in total harvest volume by 867 tons compared with the same period last year. NRS sold its 12.8percent stake in Lingalaks AS during the first quarter, which generated a gain of NOK 23.7 million. Profit before tax totalled NOK 51.3 million for the first quarter of 2011, and NRS had a negative cash flow from operational activities of NOK 1.7 million for the quarter.
The equity ratio increased to 42.3 percent by the end of the first quarter of 2011 while net interest-bearing debt was reduced by NOK 7.8 million to NOK 418 million in the same period.
Fish Farming Segment
The fish farming segment achieved an EBIT before fair-value adjustment in the first quarter of 2011 of NOK 12.3 million, compared with NOK 35.8 million for the corresponding quarter last year. EBIT per kg gutted weight (before fair-value adjustment) totalled NOK 11.90 in the first quarter of 2011, compared with NOK 10.54 for the corresponding quarter of 2010.
As planned, the fish farming segment had a low harvest volume in the first quarter, and a total of 1,035 tons gutted weight was harvested, compared with 3,395 tons gutted weight for the same quarter last year. The fish farming segment estimates that a total of 21,500 tons will be harvested in 2011, 4,200 tons of which will be in the second quarter. The group owns 25 licences, which gives an annual production capacity of almost 30,000 tons gutted weight.
NRS has therefore significant unused production capacity, and it is focusing on exploiting this in a profitable manner. With last year's release of smolts and the current biomass, the company is well on schedule for the coming year's harvest volume and exploitation of production capacity.
Sales Segment
The sales segment achieved an EBIT before fair-value adjustment of NOK 2.3 million for the first quarter of 2011, compared with NOK 2.4 million for the same quarter last year. EBIT per kg before fair-value adjustment was NOK 0.24 for the first quarter of 2011, compared with NOK 0.21 for the corresponding quarter in 2010. The volume sold in the quarter totalled 9,525 tons of farmed fish, which is a reduction of 1,836 tons compared with the same quarter last year.
The strong demand for salmon in 2010 has continued into 2011. This has resulted in another quarter with prices at seasonal record levels. Contract prices and future prices support a strong market balance for the rest of 2011.
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