Strong Salmon Demand Boosts Mowi’s Second Quarter Profits

The easing of foreclosure restrictions globally and the subsequent strengthening in demand for salmon helped Mowi, headquartered in Bergen, Norway, post operating profit before interest and taxes (EBIT) and revenue higher in the second quarter of 2021.

Mowi posted an operating EBIT of 137.1 million EUR (160.6 million USD), an increase of 38.5 million EUR (41.1 million USD) compared to the operating EBIT achieved during the corresponding period from 2020.

The salmon farming group also saw salmon spot prices increase by 18% in Europe and 50% in the Americas during the quarter, amid a return to demand in the catering industry and continued demand in the restaurants. retail channels.

According to its latest earnings statement, Mowi’s operating revenue for the most recent quarter exceeded € 1 billion ($ 1.2 billion), compared to € 910.9 million ($ 1.1 billion) in the second quarter of 2020. In line with previous forecasts, its total harvest volume for the three months was 107,977 metric tonnes (MT) gutted weight, compared to 104,303 MT in Q2 2020 and 98,483 MT in Q2 2019.

Mowi’s harvest forecast for the year 2021 has been increased from 5,000 MT to 450,000 MT.

“Demand for salmon has strengthened as COVID-19 measures have become less restrictive in most countries,” said Ivan Vindheim, CEO of Mowi. “The demand response was impressive in the quarter, with global salmon prices around 25% higher year-over-year, despite relatively high global supply growth of 9%, including the release of frozen stocks from Chile. “

Mowi’s farming efforts improved with higher prices and stable harvest volumes and costs, while its consumer products division hit record volumes for the second quarter in a row, he reported. .

Mowi’s agricultural segment operating EBIT nearly doubled to EUR 110.7 million (USD 129.7 million) in the last quarter. Its salmon of Norwegian origin reached an operating EBIT per kilogram of 1.37 EUR (1.61 USD) in the last quarter, compared to 1.07 EUR (1.25 USD) in the second quarter of 2020. Salmon of Scottish origin , Chilean and Faroese from Mowi also recorded an increase. operating EBITs per kilogram of EUR 1.56 (USD 1.83), EUR 0.98 (USD 1.15) and EUR 1.91 (USD 2.24), respectively, while its Irish salmon declined to 1 , 84 EUR (2.16 USD) per kilogram. It’s salmon from Canada also posted a higher EBIT-per-kilogram, which still represents a loss of 0.51 EUR (0.60 USD).

Going forward, Mowi decided to split its largest agricultural unit, Norway Region Mid, into two new regions; West and Middle. Coming from SalMar, Olaf Skjærvik has been appointed the new Managing Director of the Mid region, while the current Managing Director of the Mid region Asgeir Hasund will be the new Managing Director of the West region.

“Fish farming is still a matter of details and craftsmanship, which requires practical management, especially in the most biologically difficult areas. This reorganization will allow us to improve our operational performance, including productivity and costs, in this important agricultural area for Mowi, ”said Vindheim.

Mowi’s consumer products segment operating EBIT was € 16.2 million (US $ 19 million) compared to € 23.3 million (US $ 27.3 million) at second quarter of 2020, due to higher commodity prices, while its revenue climbed to 665 million euros (779.2 million USD). The total volume sold was 57,732 MT.

Its food segment recorded operating EBIT of 3.3 million euros ($ 3.9 million), down from 6.1 million euros ($ 7.1 million) a year earlier , with food production down 107,412 tonnes, of which 96,142 tonnes were sold.

Mowi confirmed that while global consumption growth reached 9 percent in the last quarter, global salmon supply saw a limited increase of 1.1 percent to 564,700 MT, gutted weight. In terms of contributions, Norway provided 287,500 MT, up 5.9 percent; Scotland 48,000 MT, up 17.1%; Chile 135,100 MT, down 14.2%; and North America 37,800 MT, down 2.1%.

At the same time, several MOWI brand launches were undertaken during the last quarter, notably MOWI Pure in Belgium, MOWI Gourmet and Signature in Italy and MOWI Sushi in Spain.

“We are continuing our long-term quest to democratize the salmon category through our MOWI branding strategy, and it is exciting to see how well our branded products are received by consumers in Europe, America and the United States. ‘Asia,’ Vindheim said.

Also in the quarter, Mowi entered into a new five-year green facility worth € 1.8 billion (US $ 2.1 billion) with his banking consortium, with Vindheim saying “sustainability is deeply ingrained ”in Mowi’s culture and he was thrilled that the group had now achieved 85 percent green and sustainable funding with ease.

The board of directors of Mowi has decided to pay a quarterly dividend of NOK 1.96 (USD 0.22, EUR 0.19) per share, consisting of NOK 0.96 (USD 0.11, 0.09) per share. ordinary dividend share and an extraordinary dividend of NOK 1 (USD 0.11, EUR 0.10) per share.

Photo courtesy of Mowi

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