Norwegian salmon giant Mowi posted yet another set of record results for the fourth quarter of 2022, with the company's earnings for the full year passing the €1 billion ($1.1 billion) mark for the first time.
For the fourth quarter alone, Mowi's operational profit surged 64 percent to €239 million ($256.3 million), while the group reported record-high revenue of almost €1.4 billion ($1.5 billion), an increase of 18 percent over the same period a year ago.
The strong quarterly results, driven by high salmon prices and volumes, meant for the first time in its nearly 60-year history, Mowi crossed the €1 billion ($1.1 billion) earnings mark for the full year. Full year revenue of €4.9 billion ($5.3 billion) was also a new record for the company.
Mowi harvested 131,000 metric tons of salmon in the quarter and a total of 464,000 metric tons in 2022, which was 4,000 metric tons more than guided one year ago.
In Norway, its largest region, harvest volume reached a record-high level of 294,000 metric tons.
Mowi said blended achieved prices increased by 18 percent from the comparable quarter of 2021 on good demand, while the blended farming cost was €5.25 ($5.60) per kilo, relatively stable from the prior quarter despite a negative impact from challenging biology in Scotland and Ireland.
The group is projecting a harvest volume of 484,000 metric tons in 2023, which would represent an all-time high level, and includes volume from Mowi’s newest subsidiary, Arctic Fish in Iceland, the acquisition of which was completed during the fourth quarter. This will equate to volume growth of as much as 109,000 metric tons in five years.
Mowi acquired a 51 percent stake in Arctic Fish from SalMar in December for NOK 1.9 billion (€180 million/$190 million).
Iceland is Mowi’s seventh farming country and was "the last spot missing from our geographical footprint," said Vindheim.
Value-added, feed divisions also post strong quarter
Mowi Consumer Products, the group's value added division, also had another strong quarter and year, setting both operational and financial records on good consumer demand and impressive operational performance, said the group.
The division posted an annual operational profit of €112 million ($120.1 million) and volume of 229,000 metric tons product weight.
Operational earnings before interest and taxes (EBIT) for the quarter reached €42.5 million ($45.6 million) up 66 percent over the same quarter a year ago.
"Mowi will further enhance our value proposition downstream in the years to come and our branding strategy, with its ultimate goal of decommoditizing the salmon category, plays a key part in this context," Vindheim said.
Additionally, Mowi Feed had its best quarter and best year so far with an operational profit of €21 million ($22.5 million) and €47 million ($50.4 million), respectively.
Feed production reached 515,000 metric tons for the year, an increase of 7 percent from 2021, and this is expected to grow further in 2023, Vindheim said.
Norway tax proposal could be 'devastating'
Mowi is among the leading employers in Norway, employing one in 300 of the Norwegian workforce.
However, the company said it is afraid that its ambitions for continued growth in Norway will be "severely inhibited" by the Norwegian government’s proposal to impose a resource rent tax on aquaculture.
Mowi CEO Ivan Vindheim said the proposal for an effective tax level of 62 percent for the Norwegian salmon farming industry, or approximately 80 percent with Norwegian wealth tax included, would "completely undermine future growth prospects for coastal Norway’s most critical industry."
"This industry currently employs 60,000 people in coastal communities, and at the end of the day it is their livelihoods as well as future job creation that are being put in peril," he said.
"Consequently, I sincerely hope that government and parliament will listen to the industry and wider coastal communities and choose a different tax rate and a tax model that is less devastating to the Norwegian aquaculture industry so that we can continue to invest in coastal Norway in the future."