May 17, 2023

Leroy CEO expresses disappointment despite higher profits in Q1 2023

Lerøy, a major Norwegian fish farming, trawling, and seafood processing group, reported increased profits for the first quarter of 2023, but company CEO Henning Beltestad said that the results could have been better, Fish Farmer reported.

The company, which also holds a 50% stake in Scottish Sea Farms, achieved an operational EBIT of NOK 989 million (~US$92.3 million; NOK 1 = US$0.093) in Q1, compared to NOK 889 million (~US$83 million) in the previous year.

Beltestad said that the quarter was impacted by inflation in seafood prices and challenging conditions in aquaculture during the latter half of 2022. These factors resulted in lower average weights and a suboptimal slaughter profile affecting price development in the first quarter.

To address these challenges, Leroy has implemented various measures that are expected to yield positive results gradually, Beltestad said.

The group's turnover rose by 26% to NOK 6.79 billion (~US$634 million), and the company anticipates a harvest of 193,500 tonnes for the entirety of 2023.

Beltestad noted the continued strong demand for seafood, with salmon spot prices significantly higher than a year ago, partly due to a weaker kroner. But he also emphasised that costs are increasing, posing additional challenges.

During the Q1 period, the company's wild fish catch amounted to 25,300 tonnes, including 8,000 tonnes of cod.

Leroy acknowledged Scottish Sea Farms' biological issues in recent months, but stated in its annual report that its joint ventures represented substantial value, despite a lower Q1 harvest of 5,200 tonnes. The volume guidance for Scottish Sea Farms in 2023 remains unchanged at 37,000 tonnes.

-      Fish Farmer