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Grieg on course for 20 percent annual increase

Atlantic Salmon Post-harvest +5 more

Grieg Seafood expects to increase its salmon harvest to 75,000 tonnes this year – an increase of 20 percent compared to 2017 – following marked improvements in its production in Finnmark, BC and Shetland.

The forecast follows on from its Q2 report, published today, which reveals that the group harvested 22,568 tonnes of salmon – an increase of 22 percent on Q2 2017 and its highest ever harvest volume for the quarter.

"We have an ambition to reach an annual harvest volume of 100 000 tonnes by 2020. This increase in production will be obtained by better utilizing our existing licenses, investing in new capacity and stocking larger smolt. We also have an ambition to achieve production cost at or below industry average. Reduced production time in sea, optimal feeding, preventive sea lice measures and digital tools are important initiatives to reach our goals, while at the same time achieving long-term sustainable production," says CEO Andreas Kvame.

Despite this increase the full year estimate has been reduced by 5,000 tonnes due to outbreaks of PD in its Rogaland operations - which decreased both the quality and the weight of the salmon - and the occurrence of a harmful algal bloom, which killed 1,000 tonnes of salmon in BC.

Although Grieg achieved a NOK 1.54/kg decrease in the cost of production, their EBIT/kg fell to NOK 18.89 for the period, down from NOK 21.20 in Q2 2017. This was due to the firm recording a NOK 3.21/kg decrease in spot prices, despite an increase in the Nasdaq Salmon Index to NOK 68.81/kg - up by NOK 0.98 per kg compared to the same period in 2017

The company reiterates an overall goal of increasing production by at least 10 percent annually until 2020, with the main growth taking place in 2019.