Faroese and Scottish salmon producer Bakkafrost was bolstered by a solid first quarter, with record high salmon prices supported by improved volumes marking a better start to 2022 than the second half of last year had foretold.
The company posted a 56 percent upswing in earnings before interest, tax, depreciation and amortization (EBITDA) to DKK 554 million (€73.1 million/$77.4 million), in large part thanks to a 39 percent hike in revenues hitting DKK 1.6 billion (€220.3 million/$233 million).
The group's Faroese salmon farming segment was the best performing, with a more than doubling of earnings before interest and tax per kilo to NOK 36.03 (€3.53/$3.74) from last year's NOK 14.10 (€1.38/$1.46).
Harvest volumes rocketed 25 percent from Bakkafrost's farms in the region, notching up 17,459 metric tons and with good biological development and low sea lice levels, performance was strong.
The same cannot be said for Bakkafrost's Scottish operations, which was pounded by a weak start to the quarter and a 43 percent drop in volumes to just 3,973 metric tons.
The company, which had suffered from gill health issues during the third and fourth quarters of last year, however, saw "significant improvements" at its Scottish farms through the quarter and no exceptional mortalities, with hopes for more improvements through the year.
While high salmon prices are a boon to the farming segments, the same cannot be said for the processing industry. Bakkfrost's value-added segment was no exception, shouldering a huge 130 percent fall in EBIT per kilo to a loss of NOK 5.65 (€0.55/$0.59) from last year's NOK 18.56 (€1.82/$1.93) earnings.
Bakkafrost's fishmeal and oil operation remained a bright spot during the quarter, posting a 4 percentage point increase in EBITDA margin to 19.6 percent.
"Overall, we are pleased with the results from the Faroese farming operation and our fishmeal and oil segment," said CEO Regin Jacobsen.
"In this quarter, our farming operation in the Faroe Islands has continued on the trajectory to higher volumes. The biology has been good and sea lice levels low. The expansions of the Norðtoftir and Glyvradal hatcheries are also progressing as planned and will be completed later this year."
Bakkafrost is the largest salmon farmer in the Faroe Islands and the second largest salmon farmer in Scotland.
The group is fully integrated and has production of fishmeal, fish oil and salmon feed in the Faroe Islands and primary and secondary processing in the Faroe Islands, Scotland, New Jersey and Denmark.