SalMar (Buy, TP: NOK670.00) - Strong Q4, 2024e volumes cut
Q4 operating EBIT of NOK2,158m was 21% above our forecast and 3% above consensus. The beat versus our estimate was driven by higher realised prices and lower costs in Central region despite challenges with string jellyfish. SalMar guided for stable costs QOQ in Q1, as well as stable volumes YOY. The 2024 harvest guidance was cut by 20kt in Norway due to string jellyfish. The 2023 DPS of NOK35 was above expectations of NOK20. We expect consensus 2024e EPS to come down by c10% and expect the stock to fall 2–4% today.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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