Marine Harvest: markets absorbed supply increase - contracts protected margins

February 8, 2012 11:10

The Marine Harvest Group achieved an operational EBIT of NOK 403 million in the fourth quarter of 2011, compared to NOK 1 033 million in the corresponding quarter of 2010. Favourable sales contracts reduced the impact on margins from lower spot prices. Marine Harvest expects a challenging supply situation in 2012 with continued price pressure and has taken necessary measures to preserve financial strength, reports www.megafishnet.com with reference to the company.

Marine Harvest reported operational revenues and other income of NOK 4 254 million (NOK 4 612 million) in the fourth quarter of 2011. Harvest volumes increased by 16 percent to 104 589 tons from 90 485 tons in the fourth quarter of 2010. Net earnings in the period were NOK 100 million (NOK 1 071 million).

- Spot prices continued to fall in the fourth quarter as markets absorbed an increase in industry supply of 20.5 percent. The group achieved an operational EBIT of NOK 403 million mainly due to favourable sales contracts. The reduced price level has resulted in improved results in Marine Harvest VAP Europe and is stimulating global demand in general. We use this momentum to expand the market for Atlantic salmon and attract new customers, comments CEO of Marine Harvest ASA, Alf-Helge Aarskog.

Cash flow from operations amounted to NOK -107 million (NOK 305 million) in the fourth quarter of 2011 due to seasonal build-up of working capital. Net financial items amounted to NOK -37 million (NOK -103 million). Net financial items include interest expenses of NOK 107 million (NOK 101 million). Net interest-bearing debt increased to NOK 6 467 million (NOK 6 142 million at end of the third quarter).

The equity ratio was 47.6% at the end of the quarter (47.3% at end of the third quarter). Annualised ROACE was 4.9% (25.5%) and NIBD/Equity was 59.6%, compared to 58.1% at the end of the third quarter.

Marine Harvest Norway achieved an operational EBIT per kilo of NOK 4.13 (13.03) in the fourth quarter, while in Scotland and Canada reported operational EBIT per kilo was NOK 4.32 and NOK -3.11 respectively (8.76 and 3.80). Marine Harvest VAP Europe reported an operational EBIT margin of 5.4% (2.0%) in the fourth quarter of 2011, while Marine Harvest Chile achieved an operational EBIT per kg of NOK 2.82 (12.37).

Marine Harvest is restructuring the operation in Canada, by concentrating operations to the best performing sites, reducing smolt stocking workforce. This has resulted in restructuring costs of NOK 23 million and asset write down of NOK 54 million in the quarter.

Marine Harvest expects to harvest a volume of 360 000 tonnes in 2012, of which 89 000 tonnes is expected to be harvested in the first quarter.

- We expect a challenging supply situation in 2012 with continued pressure on prices. Our sales and marketing unit will continue to exploit the strong demand stimulus from reduced prices to expand the market for Atlantic salmon. In our farming units we maintain our strong focus on capital efficiency and cost measures to preserve our financial strength. The restructuring of our operations in Canada opens up for improved performance in the second half of 2012, says Alf-Helge Aarskog.

For further information, please contact:

Jørgen Andersen, CFO, Tel: +47 21 56 20 09, Mobile: +47 951 43 854

Henrik Heiberg, Finance Director, Tel: +47 21 56 20 11, Mobile: +47 917 47 724

About Marine Harvest

Marine Harvest is the world's leading seafood company and largest producer of farmed salmon, with presence in 22 countries and a total of 6 200 employees worldwide. The company is headquartered in Bergen, Norway, and is listed on the Oslo Stock Exchange. Please see http://www.marineharvest.com/ for further information.

{{countTopicsText}}
What is MEGAFISHNET.COM?
MEGAFISHNET.com is a global fish and seafood marketplace with an emphasis on APPROVED SUPPLIERS from such major sources as China, Russia, Vietnam, Europe, Americas, etc. More details →