New record for SSC despite high costs

THE Scottish Salmon Company (SSC) has recorded its best ever EBIT/kg in the first quarter of this year, at £1.67, up from £0.30 in the same period last year.

Revenue for the period was £35.1 million, compared to £29.1 million in Q1 last year, on harvested volumes of 5,685 tonnes (Q1 2016: 6,741 tonnes).

Increased revenue was driven by further development of the export market, and increased contract prices, with a focus on customer partnerships, together with consistently higher market prices, said the company.

However, biological challenges remain a challenge and this affected costs in 2016. These rose by 15 per cent in the final quarter of last year and have followed through into the first quarter 2017.

The company remains focused on biological improvements and has leased an additional well boat to ensure operational flexibility, as well as commissioning a dedicated hydrolicer.

It also plans to introduce more cleaner fish throughout its marine sites.

During the quarter, the SSC received a positive decision notice for a site at Portree on the Isle of Skye with an additional 2,000 tonnes of consent.

This brings the operations in that location to more than 4,000 tonnes capacity.  Smolt release will commence in September 2018, with first harvests anticipated to start in late 2019.

In Q1 2017, export sales accounted for 47 per cent of value, compared to 43 per cent in Q1 2016.

The company continues to target overseas markets, leveraging the value of its provenance and the continued demand for quality Scottish produce.

Together with sales of Label Rouge salmon, Native Hebridean salmon is a key driver of export growth.

Craig Anderson, CEO, said: ‘We remain firmly focused on our long term growth strategy and new site development is an integral part of this strategy.  The development of the site at Portree demonstrates this and complements our existing Hebridean operations.

‘We have made positive steps to address the biological challenges, introducing new initiatives including the commissioning of a hydrolicer and an additional well boat to increase operational efficiencies and increase flexibility.

‘The global salmon market remains strong and prices are forecast to remain firm.  Demand at home and overseas for Scottish salmon as a premium food product continues.

‘Our aim remains to capitalise on this with our continued drive on exports, together with a focus on developing long term customer partnerships.

‘Our Native Hebridean development complements the increasing trend of food provenance which is core to our marketing drive for overseas sales.’

The SSC expects to harvest about 25,000 tonnes in 2017.

 

 

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