Lerøy 2017 results hit new record

Lerøy 2017 results hit new record

THE Lerøy Seafood Group today reported an eight per cent rise in revenues last year to a record high of NOK 18,624 million (£1.7 billion) in what it describes as a demanding and exciting year.

And the operating profit also hit record levels, rising to NOK 3,317 million (£303.5 million) from NOK 2,843 million in 2016.

The profit before tax and fair value adjustment related to biological assets in 2017 was NOK 3,805 million compared with NOK 2,926 million in 2016.

This, said the company, represents the highest revenue, highest operating profit before fair value adjustment related to biological assets and highest profit before tax and fair value adjustment related to biological assets in any year in the group’s history.

The Lerøy Seafood Group (which part owns Scottish Sea Farms) is unusual in that it is not only a Norwegian fish farming giant, but it also operates a large conventional white fish trawler fleet (formerly Havfisk) and associated processing facilities through the Norway Seafoods Group, which it acquired in October 2016.

CEO Henning Beltestad said: ‘We can look back on one of the most exciting and demanding years in the group’s history. 2017 saw the proper implementation of our strategy to integrate white fish into the group’s well established value chain for red fish.

‘We are experiencing positive development in our downstream operations and we can report successful operations within fish farming.

‘I would like to express my sincere thanks to the group’s skilled employees. In 2017, Lerøy has taken huge steps towards a position as an integrated supplier of seafood and we believe we are uniquely well positioned to meet our customers’ needs in the years to come.’

As expected and in line with other farming companies, the final 2017 fourth quarter figures were dented by lower salmon and trout prices during the period.

In Q4 2017, revenues totalled NOK 4,567 million, compared with NOK 4,924 million in Q4 2016. The harvest volume in Q4 2017 totalled 42,000 tonnes gutted weight of salmon and trout, up eight per cent on Q4 a year earlier.

Beltestad added: ‘Improvements in biological performance for the entire Norwegian fish farming industry in 2017 resulted in a higher harvest volume in Norway, which in turn put pressure on salmon prices towards the end of 2017.

‘Lerøy has close links with the end market, and we continue to experience very strong demand for seafood and salmon.’

Lerøy’s trawler fleet has a licence to catch 10 per cent of Norway’s northern cod quota. Last year it fished 8,511 tonnes of cod, 1,545 tonnes of saithe and 1,264 tonnes of haddock which earned high prices.

Beltestad said: ‘We are looking forward to further developing the wild catch and white fish segment. Havfisk received delivery of a new trawler in January this year and we have high expectations for the new arrival.

‘Industrial development of white fish processing in Norway is challenging, but we have a clearly defined objective to increase both competitiveness and earnings by means of successful marketing and efficient operations.’

The farming segment reported operating profit before fair value adjustment related to biological assets of NOK 567 million in Q4 2017, down from NOK 827 million in Q4 2016.

For 2017 as a whole, the harvest volume is five per cent higher than in the corresponding period in 2016. EBIT/kg fell from NOK 21.1 per kg in Q4 2016 to NOK 13.4 per kg in Q4 2017, mainly attributable to the fall in prices realised.

Picture: CEO Henning Beltestad

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