July 22, 2011

 

Cermaq perceives business units' progress 

 

 

Cermaq has announced that the progress of both business units have led to an EBIT pre fair value of NOK318 million (US$58.9 million) for Q2, an increment of NOK103 million (US$19.1 million) on year.

 

The shift was driven by better results in Chile, a higher share of value-added products in EWOS and Mainstream Canada's outstanding performance.

 

However, Cermaq reported a negative cash flow from operating activities of NOK97.2 million (US$18 million) in the second quarter versus a negative NOK11.9 million (US$2.2 million) during the corresponding period of 2010, mainly due to strong sales growth and higher receivables in EWOS, plus increased payment of income taxes. Net interest bearing debt in the quarter rose by NOK761 million (US$140.9 million) to NOK1.215 billion (US$225 million).

 

Cermaq's EBIT pre fair value was NOK317.7 million (US$58.8 million) versus NOK215.1 million (US$39.8 million) in Q2 2010, and net profit fell to NOK175.3 million (US$32.5 million) from NOK363.6 million (US$67.3 million) due to negative fair value adjustments on biological assets from lower salmon prices at the end of the quarter.

 

"We are particularly pleased with the strong performance in EWOS from a solid volume growth as well as the results of the feed business unit's focus on research based product development," said CEO Geir Isaksen.

 

Mainstream made NOK715.5 million (US$132.5 million) against NOK665.4 million (US$123.2 million) on year and sold 17,500 tonnes, up from 16,600 tonnes of product. Its EBIT rose to NOK213.4 million (US$39.5 million) from NOK174.2 million (US$32.3 million) due to better operating results within farming pushed by higher volumes and improved cost in Canada.

 

The expansion of the processing plant in Finnmark will be ready early next month and the farming investments to facilitate an increased harvest in 2013 are advancing according to plan.

 

Mainstream Canada harvested 6,300 tonnes, 50% or 2,100 tonnes more than the same quarter in 2010.

 

EWOS had revenues of NOK2.118 billion (US$392.2 million) compared to NOK1.515 billion (US$280.5 million) in Q2 2010, with 245,000 tonnes sold against 183,000 tonnes on year, up 34%. Organic growth was 28%. Higher volumes originated primarily from strong growth in Chile where EWOS's volumes rocketed by 78%.

 

EWOS's EBIT climbed to NOK127.6 million (US$23.6 million) versus NOK59.4 million (US$11 million) in last year's second quarter. It is not being harmed much by decreasing salmon prices.

 

"With its strong research based product portfolio we expect that customers also in a market with lower prices will see the benefit of using functional feed that have good impact on fish health and growth," Isaksen commented.