(Figures in parenthesis refer to the same period last year unless otherwise specified)
The performance in Q1 2024 per region was very uneven:
Faroe Islands Revenues ofDKK 1,594 million (1,341 million)
Operational EBIT of
Scotland Revenues ofDKK 612 million (708 million)
Operational EBIT of
Commenting on the result, CEO
"We har satisfied with our strong results in the first quarter 2024 - especially in the
In our freshwater operation, performance and smolt quality is good in the
During Q1 2024, the FOF segment sourced 136,874 tonnes (156,015 tonnes) of raw material. The Operational EBIT margin was 24% (17%), and fish feed sales amounted to 27,046 tonnes (22,287 tonnes).
In Q1 2024, the Freshwater segments in the
** Freshwater FO: 2.1 million (2.1 million),
** Freshwater SCT: 1.6 million (1.7 million).
The Freshwater FO segment made an operational EBIT per kg released smolt of
The Freshwater SCT segment made an operational EBIT per kg released smolt of -
The Farming segments achieved higher prices in Q1 2024 than in Q1 2023. Farming FO segment had higher volumes and Farming Scotland segment had lower harvest volume in Q1 2024 compared to Q1 2023. In Q1 2024, the Farming SCT segment had incident-based costs of
The total combined harvest in Q1 2024 of the farming segments in the
** Farming FO: 14,294 tgw (11,005 tgw),
** Farming SCT: 7,263 tgw (8,093 tgw).
In Q1 2024, the Farming FO segment made an operational EBIT/kg of
The Services segment made an operational EBIT/kg of
The Sales & Other segment had a revenue of
The performance related to the
The long-term goal of the Board of Directors is that 30-50% of earnings per share shall be paid out as a dividend. Bakkafrost's financial position is strong, with a solid balance sheet, a competitive operation, and available credit facilities. The Board of Directors proposes to the Annual General Meeting that
* The dividend per share in NOK is subject to changes depending on the exchange rate between NOK and DKK, which was announced on
OUTLOOK
Market
Flat supply supported by inventories in Q1 2024
The supply of salmon increased slightly by 0.6% in Q1 2024 compared to Q1 2023, incl. inventory movements. Without inventory movements, the supply reduced 4.8%, according to the latest estimate from Kontali Analyse.
Salmon prices increased slightly in Q1 2024
Salmon spot prices (in EUR) were 0.5% higher this quarter compared to Q1 2023 with high price differentiation between large and small fish. Prices were affected by the tight supply, reduced availability of large fish on the spot market, but also by increased consumer price sensitivity in some segments.
1% growth in 2024
The global supply is expected to reduce 2% in H1 2024, compared to H1 2023. In H2 2024, the global supply is expected to grow around 3%, compared to H2 2023. For the full year 2024, the global supply is expected grow around 1%, excluding inventory movements.
Bakkafrost has a strong focus on ensuring a well-balanced flow to the different markets to increase diversification and mitigate market risk. Bakkafrost operates in the main salmon markets,
Farming
The biological performance Q1 2024 in the Faroese farming operation was strong. Bakkafrost started 2024 with a much bigger biomass than the year before, and has harvested big fish with high superior rates that allowed for high price achievements. Bakkafrost's ability to do dual freshwater treatments has kept sea lice levels at record lows. Growth was also good in the quarter and the Faroese farming operation has a strong outlook, expecting to keep good harvest weights and high quality in the coming quarters.
In the Faroese freshwater operation, the main focus for Bakkafrost is to continue to increase the production volume of high-quality large smolt. In 2023, the hatchery capacity in the Faroes was increased by more than 50% through the expansions of the Norðtoftir, Glyvradal and Viðareiði hatcheries, increasing the total hatchery capacity in the Faroes to 18 million smolt of 500g. In Q1 2024, Bakkafrost started the construction of the new hatchery in Skálavík, Faroe IsIands, which will further increase the production capacity by around 7 million smolt at 500g. Once the Skálavík hatchery is complete in three years time, the annual smolt production capacity in the
In Q1 2024, the farming operation in
Bakkafrost's de-risking strategy for the Scottish operation also covers the freshwater operation. In order to address the biological risks, Bakkafrost made strategic adjustments to its short-term production plans and conducted a comprehensive risk assessment for all farming sites, including evaluating the feasibility of stocking and farming these sites using various strains, hatcheries, and smolt sizes. Based on this evaluation, Bakkafrost will prioritise and advance the utilisation of large, high-quality smolt from the Applecross hatchery over external sources. Consequently, Applecross will supply nearly all of the required smolt to the marine sites in 2024, focusing on delivering a well-controlled increase of the production of large high-quality smolt. Only by exception will smolts be sourced externally, if the size and quality of the smolt is sufficiently high.
In 2024, Applecross is expected to supply around 8.0 million smolts. The average weight of the smolt is expected to increase during the year reaching 200g on average for Q4 2024. The average weight for the full year 2024 is expected to be around 165g. The smolt release and average weight from Applecross is lower than planned for 2024 due to start-up issues in parts of the AP4 facility, not yet fully commissioned by Bakkafrost. The smolt release from Applecross is expected to account for around 98% of the total planned smolt release for 2024. When the Applecross 5 & 6 expansions are completed around year-end 2024, Applecross will be able to produce all smolts for
Smolt release
Bakkafrost's smolt release in the
Million smolt transferred | '24e | '23 | '22 | '21 | '20 | '19 |
FO | 17.0 | 14.4 | 14.5 | 14.4 | 14.3 | 12.7 |
SCT | 8.2 | 10.5 | 10.8 | 11.1 | 10.4 | 12.4 |
Avg. weight (g) | ||||||
FO | 450 | 396 | 345 | 376 | 320 | 205 |
SCT | 165 | 117 | 107 | 95 | 88 | 83 |
In the freshwater hatchery operation, Bakkafrost has a focus on ensuring stable growth and continuous improvements of smolt quality. In the Faroes Islands, it is important to harmonise the size and quality of the smolt as it leads to better utilisation of marine farming sites and increased harvest weights.
In 2024, Bakkafrost expects to harvest around 66,000 tonnes gutted weight in the
Expected harvest profile as a % of total harvest pr. region:
Region | Q1 | Q2 | Q3 | Q4 |
FO | 22% | 19% | 29% | 31% |
SCT | 29% | 49% | 14% | 8% |
The estimates for harvest volumes and smolt releases in both geographies are dependent on biological development.
Sales & VAP (Value added products)
Bakkafrost's highly flexible value chain includes state-of-the-art VAP processing capacity, which enables the company to adapt effectively to rapidly changing market situations.
As a result of changes in the Faroese revenue tax, Bakkafrost has adjusted the strategy for contracted VAP (Value-Added Products) to reduce contract exposure for 2024.
For 2024, Bakkafrost has signed contracts covering around 9% of the expected harvest volumes in the
FOF (Fishmeal, oil and feed)
The outlook of fishmeal and fish oil production is dependent on the availability of raw materials.
The ICES 2024 recommendation for blue whiting is 1,530 thousand tonnes, which represents a 12.5% increase from the recommendation for 2023.
In 2024 Bakkafrost expects continued high production volumes of fishmeal and normalisation of fish oil production volumes.
The major markets for Havsbrún's fish feed are the internal Faroese and Scottish Farming segments.
Investments
On the Capital Markets Day on
The main purpose of the investments in
The investments in the
With the investment plan, Bakkafrost expects to sustainably grow the total annual harvest volumes to 165,000 tonnes in 2028. Over the same period, the total annual production capacity in Bakkafrost's value chain will reach 200,000 tonnes gutted weight.
Financial
The global salmon product market's long-term balance is likely to favor Bakkafrost. Bakkafrost has a long value chain and a cost-efficient production of high-quality salmon products and will likely maintain financial flexibility going forward.
In
Please find the Company's Q1 2024 report and the Q1 2024 presentation enclosed.
Contacts:
Regin Jacobsen , CEO ofP/F Bakkafrost : +298 235001 (mobile)-
Høgni
Dahl Jakobsen , CFO ofP/F Bakkafrost : +298 235060 (mobile)
This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.
About Bakkafrost:
Bakkafrost is the largest salmon farmer in the
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