Results of Marine Harvest Group impacted by weak prices in the quarter - Investing in feed capacity
(Oslo, 26 October 2012) The Marine Harvest Group achieved an operational EBIT of NOK 73 million in the third quarter of 2012, compared to NOK 457 million in the corresponding quarter of 2011. The results were impacted by weak market prices and a lower benefit from sales contracts compared to previous quarters. Cash flow from operations was NOK 237 million in the quarter (Q3 2011: 269 million), reports www.megafishnet.com with reference to Marine Harvest Group.
-The results for the third quarter were negatively impacted by low market prices and limited benefit from the sales contract portfolio compared to previous quarters. I am pleased by the organization's ability to deliver on costs, particularly in Norway. We are struggling in Chile and Canada due to the exceptional low market prices in the Americas. We are continuing to benefit from the cash flow measures implemented last year, and our balance sheet is therefore very strong, say Alf-Helge Aarskog, CEO
Marine Harvest reported operational revenues and other income of NOK 3 647 million (NOK 3 636 million) in the third quarter of 2012. Harvest volumes increased by 12 per cent to 93 229 tons from 83 076 tons in the third quarter of 2011.
Marine Harvest Norway achieved an operational EBIT per kilo of NOK 2.47 (6.39) in the third quarter, while Marine Harvest Scotland and Marine Harvest Canada reported operational EBIT per kilo was NOK 2,21 and NOK -5,95 respectively (10.42 and -7.97). Marine Harvest Chile achieved an operational EBIT per kg of NOK -2.54 (6.02). The numbers include contribution from Sales and Marketing, including VAP Europe.
Marine Harvest VAP Europe reported a break even result in the quarter compared to NOK 35 million in the third quarter of 2011. Marine Harvest Group expects to harvest a volume of 390 000 gutted weight tonnes in 2012, of which 101 000 tonnes are expected to be harvested in the fourth quarter.
Cash flow from operations amounted to NOK 237 million (NOK 269 million) in the third quarter of 2012 after a reduction in working capital of NOK 37 million (NOK -302 million). Net financial items amounted to NOK -100 million (NOK -28 million). Net financial items include interest expenses of NOK -92 million (NOK -105 million). Net interest-bearing debt for third quarter was NOK 5 005 million, .compared to NOK 6 142 million Q3 2011, and to 5 177 million at the end of Q2 2012.
The equity ratio was 49.1% at the end of the quarter (50.8% at end of the second quarter). Annualised ROACE for the quarter was 2.2% and NIBD/Equity 46.7% at the end of the third quarter.
- We have decided to invest in a 220 thousand tons feed facility in Norway. This is an important step in transforming Marine Harvest into an integrated protein company. We expect an attractive return on the investment and it will contribute to more stable earnings. This is a natural part of the value chain as feed represents about 50% of our costs. The investment will also balance the current unfavourable situation of few feed suppliers operating at full capacity, says Aarskog.