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Company update: Cermaq Q2

Norwegian salmon farming and fish feed company Cermaq reported profits (EBIT pre fair value) for the second quarter of 2011 of NOK 318 million (€40.9 million), an improvement of NOK 103 million from the second quarter 2010.

The strong improvement for both business units is driven by improved results in Chile, increased share of value added products in EWOS and excellent performance in Mainstream Canada.
 
Operating revenue for the group in the quarter was NOK 2,558 million (€1.029 million) compared to NOK 2,003 million in the same quarter of 2010.
 
EBIT pre fair value was NOK 318 million, however net profits were only NOK 175 million (€22.52 million) because of negative fair value adjustments on biological assets this quarter due to reduced salmon prices at the end of second quarter.
 
CEO Geir Isaksen said: “This 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.”
 
Revenue from the company’s fish farming division, Mainstream was NOK 715.5 million (€ 92m) on volumes sold of 17,500 tonnes (16,000 tonnes in Q2 2010).
 
Mainstream achieved an EBIT of NOK 213.4 million, an improvement of NOK 39.2 million compared to second quarter 2010. The better operating result within farming was primarily driven by higher volumes and improved cost in Canada.
 
Fish feed
EWOS reported revenue of NOK 2,117.5 million (€272.57m) with a total volume sold of 245,000 tonnes (183,000 tonnes in Q2 2010), an increase of 34% compared to same quarter last year.
 
Adjusted for the acquisition in Vietnam, organic growth in second quarter was 28%. Higher volumes came primarily from strong growth in Chile where EWOS’ volumes increased by 78%.
 
EBIT in EWOS increased to NOK 127.6 million (€16.4m). The new products introduced by EWOS during second quarter 2011 have been positively received in the market and contributes to improve the value added share of total volume and results in EWOS.
 
Geir Isaksen commented: “EWOS is less impacted than farming companies by the decrease in the 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.”

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