Grieg Seafood (Buy, TP: NOK115.00) - Q4 in line, but soft guidance
Grieg Seafood reported Q4 operating EBIT of NOK156m, NOK20m above our forecast but in line with consensus. The beat versus our estimates was driven by a stronger than expected margin in Finnmark. Cost guidance for the regions is for a continued steep increase in Q1 2023, contrary to previous comments on costs starting to stabilise. The 2023 harvest guidance was cut by 5kt from Finnmark and stands at 82kt versus our estimate of 83kt. The Q1 and FY 2023 contract share is guided at 15%. We expect consensus 2023 EPS to come down c10% on the higher cost outlook, and a 3–5% negative share price reaction today.Greig Seafood is a fish farming group, based in Norway, that specialized in salmon and trout. Co. is the parent company of the Greig Seafood Group. Co. is engaged in the production and sale of seafood, and naturally related activities to the sale of seafood. Co. is predominately engaged in the production of farmed salmon and trout, with a production capacity of around 95,00 tons gutted weight annually. Co. has 100 licences for salmon production and five licences for smolt production. Co. has operations in Finnmark and Rogaland in Norway, British Columbia in Canada, and Shetland (the U.K.).
DNB Markets is the investment banking arm of DNB Bank ASA and is focused primarily on the Nordic region, as well as internationally on niches such as global shipping, energy and related services, and seafood. DNB Markets offers services in FICC, Equities and Investment Banking advisory from offices in Oslo, Stockholm, London, Singapore and New York. Equity research coverage is offered on c250 Nordic companies. DNB was ranked no.2 in Extel Nordic Research 2017. The DNB Markets’ Credit and FICC Macro & FX Research teams are repeatedly highly rated by Prospera Nordic Institutional Investor Surveys.
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