August 25, 2014

 

Leroy sees 21% rise in harvested fish during Q2 2014

Leroy Seafood Group ASA has seen an increase in turnover and operating profit in the second quarter of 2014, due to a 21% rise in harvested salmon and trout compared to the same period in 2013.

 

In the analysed period, Leroy reported a turnover of US$514.3 million, compared to US$406.8 million in the same period in 2013. Also recorded is an operating profit before biomass value adjustment of US$80.9 million versus US$74.8 million in the same period last year.

 

Considering the first six months of the year, Lerøy has reported a turnover of US$1,029 million compared with US$784.4 million for the same period of 2013. In the same period analysed, the operating profit before value adjustment for biomass was US$170 million from US$134.7 million for the first half of 2013. The profit figure, before tax and value adjustment for biomass, was US$182.7 million versus US$132.4 million a year before.

 

Farming reported an increase in operating profit, before biomass adjustment, changing from US$64.7 million in the second quarter of 2013 to US$68.1 million in the second quarter this year.

 

"The high temperatures enjoyed during the spring and summer have allowed for increased production, but have also presented several challenges. We will harvest a significantly higher volume in 2014 than in 2013. At the same time, we expect costs for the farming companies to be somewhat higher in the second half of 2014 than in the first half," says the firm's CEO, Henning Beltestad.

 

Leroy has made substantial investments in increasing capacity for high-quality processing of salmon and trout in recent years and is now working towards gradually filling up this new capacity. "The underlying development in the VAP segment is very good. The Group has good progress in gradually exploiting the full potential of the investments made in recent years," explains Beltestad.

 

He also pointed out that the margin reported by the sales and distribution segment remains lower than the target set by Leory and added that in light of the start-up costs required for several fish-cut facilities during the quarter, the Group is satisfied with the developments.

 

In reference to the food import ban imposed by Russia, the CEO highlighted that their contract portfolio and substantial industrial downstream activities have offered them a level of protection against the short-term outcome.

 

However, he recognised the ban represents a significant challenge which will influence earnings not only for Leroy but the industry as a whole in the near future.

 

Beltestad has called for politicians to adapt framework conditions in order to minimise serious consequences amounting from these trade barriers.