SalMar (Buy, TP: NOK500.00) - Strong start to the year
Q1 operating EBIT was NOK1,884m, 12% above consensus. However, the beat was of low quality on strong price achievement in Central Norway due to favourable timing, with cost/kg in line, and smaller losses than expected in Sales & Processing. Northern Norway missed expectations on lower realised prices due to unfavourable timing and higher costs (56% NRS volume) than expected. We have raised our 2023–2025e EPS by 6.9–2.6% and reiterate our BUY and NOK500 target price.SalMar is a producer of Atlantic salmon and is integrated from roe and smolt to products and sales. Co. has farming operations in Central and Northern Norway, as well as in Scotland. Co. has operating licences for marinephase fish farms and hatcheries in central Norway and Troms County. Co. has 66 licences for production of farmed Atlantic salmon in Norway: 53 in central Norway (More & Romsdal, South and North Trondelag) and 13 in northern Norway (Troms)
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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