February 9, 2012

Scottish Salmon Company to continue expansion scheme

The Scottish Salmon Company (SCC) plans to conclude expansion operations within the next five years.

The firm, which produces about 20% of Scotland's total salmon output , said that jobs are planned for the Western Isles, with others in the Highlands and Argyll. SCC added that it was currently scoping out sites for the ten fish farms and applying for planning permission.

In the past two years, the company said it has more than doubled staff numbers from 160 to 380 and invested GBP30 million (US$47.7 million) in refurbishing its Marybank processing facility, acquiring West Minch Salmon, developing sites and upgrading existing farms.

Stewart McLelland, SCC's chief executive, pledged to develop all the new sites to the RSPCA's "Freedom Food" standard, which sets rules for stocking density, fish welfare and harvest. He added, "We are keen to bring talent into our business, developing skills and experience to support our growth plans and that of the overall industry."

SCC already operates from more than 50 sites and produced 24,000 tonnes of salmon in 2010, generating GBP92.4 million (US$146.9 million) in turnover. The company aims to grow its output to 40,000 tonnes in 2016.

In December, it blamed a sharp drop in global spot prices for salmon, caused by excessive fish flooding the market, for leaving its profits floundering. Third-quarter profits slumped from GBP4.8m (US$7.6 million) to just GBP700,000 (US$1.1 million) year-on-year, but the firm said it remained on track to hit full-year profit forecasts, thanks to its long-term contracts, which account for 70% of sales.

Revenues fell from GBP20.6 million (US$32.7 million) to GBP17.8 million (US$28.3 million) year-on-year after the amount of salmon sold dropped from 5,468 tonnes to 4,686 tonnes due to alleged imbalance in production cycles.

The latest plan to expand production - which comes on top of previous investments - is expected to help smooth out such fluctuations in output.