SalMar (Buy, TP: NOK550.00) - Q4 a mixed bag
Q4 operating EBIT was NOK1,006m, c29–32% below our forecast and consensus, driven by biological challenges in Central Norway, with costs guided slightly down for Q1. Region North performed well, with bullish 2023 cost and harvest guidance. Synergies were guided at NOK671m, with 48% already implemented, which is likely more and faster than expected. A DPS of NOK20 was proposed for 2022. The 2023 harvest guidance was 259kt, above consensus of 241kt, driven by region North. We expect the shares to trade down initially but recover through the day, ending flat.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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