SalMar (Hold, TP: NOK690.00) - Q1 on the soft side
Q1 operating EBIT of NOK1,512m was 7% below our forecast and 11% below consensus. SalMar Aker Ocean (SAO) and Icelandic Salmon reported lower-than-expected margins, accounting for the majority of the miss. The 2024 harvest guidance was unchanged at 237kt for Norway, 7kt for SAO, 15kt for Iceland and 37kt for the UK, while guided Q2 volumes were lower, suggesting a more back-end loaded profile. Costs were guided slightly lower QOQ for Norway. We expect consensus 2024e EPS to come down by c5–10% and expect the stock to fall 0–5% 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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