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Strong Market with Significant Increase in Spot Prices

30 April 2013

NORWAY - The Marine Harvest Group achieved an operational EBIT of NOK 482 million in the first quarter of 2013, compared to NOK 276 million in the corresponding quarter of 2012. An increase in working capital in the first quarter led to cash flow from operations of NOK 351 million (Q1 2012: 567 million).

"The market for Atlantic salmon in Europe was very strong throughout the first quarter, and contributed significantly to the increased earnings for all entities in the region. Salmon of European origin accounted for 74 per cent of the Group's volume in the quarter. Market prices also increased in the Americas. The Canadian business, which is benefiting from previous restructuring measures, delivered very good results. The operations in Chile is however still loss making as a result of continued cost increases due to negative biological development," says Alf-Helge Aarskog, CEO

Marine Harvest reported operational revenues and other income of NOK 3,736 million (NOK 3,846 million) in the first quarter of 2013. Harvest volumes were 80,035 tonnes in the quarter.

Marine Harvest Norway achieved an operational EBIT per kilo of NOK 8.40 (NOK 3.35) in the first quarter, while Marine Harvest Scotland and Marine Harvest Canada reported operational EBIT per kilo was NOK 7.87 and NOK 6.66 respectively (NOK 5.56 and NOK -0.04).

Marine Harvest Chile achieved an operational EBIT per kg of NOK -5.91 (NOK 2.19). The figures include contribution from Sales and Marketing, including VAP Europe. Marine Harvest VAP Europe reported an operational EBIT of NOK -18 million compared to NOK -5 million in the first quarter of 2012. Marine Harvest Group expects to harvest a volume of 350,000 tonnes gutted weight in 2013, of which 80,000 tonnes are expected to be harvested in the second quarter.

Cash flow from operations amounted to NOK 351 million (NOK 567 million) in the first quarter of 2013 after an increase in working capital of NOK 296 million (decrease of NOK 195 million), mainly due to an increase in trade receivable as a result of higher prices and recognised Easter-sales to be paid in April.

Net financial items amounted to NOK -165 million (NOK 81 million). Net financial items include interest expenses of NOK 130 million (NOK 96 million). Net interest-bearing debt for first quarter was NOK 6,314 million, compared to NOK 5,936 million in the first quarter of 2012, and to 5,381 million at the end of 2012.

The equity ratio was 50.4 per cent at the end of the quarter (50.1 per cent at end of 2012). Annualised ROCE for the quarter was 12.1 per cent and NIBD/Equity 50.3 per cent at the end of the period.

"I am very encouraged by the strong market outlook in Europe, with future prices of NOK 34 the remaining part of 2013 and 2014. Marine Harvest is well positioned to take advantage of this as the majority of our volume will be originating in Europe combined with high exposure to spot prices. Although we have limited exposure to the region, we are equally concerned about our operations in Chile which is experiencing losses and continued cost escalation," said Mr Aarskog.

TheFishSite News Desk

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