Lerøy Seafood Group ASA: Q3 2023 Results
HIGH ACTIVITY. CLEAR POTENTIAL FOR IMPROVEMENT.
In the third quarter of 2023, Lerøy reports a turnover that is 8% higher than last year. Operational EBIT in Q3 2023 amounts to MNOK 631 compared to MNOK 833 in the same quarter last year. In Farming, earnings are, as previously mentioned, affected by one-time effects related to the early harvest of fish with ISA detection. In Wild Catch, the quotas for 2023 are lower than in 2022, affecting earnings negatively. Downstream activities, VAPS&D, delivered significantly better earnings than the same quarter last year.
At the end of the third quarter and the beginning of the fourth quarter, we have faced challenges at some sites resulting in lower production than expected. This affects the expected harvest volume in 2023 and 2024. For 2024, we now expect a harvest volume of approximately 193,500 GWT, including jointly controlled operations, says Henning Beltestad.
A RANGE OF MEASURES IMPLEMENTED
To achieve our goals in Farming for 2025, we have implemented a range of measures where the focus on increased smolt quality, investments in new technology, and the implementation of Lerøy Way are crucial. We have great confidence in these measures, and their effects are expected to gradually become apparent in the form of higher growth in through 2024, says Henning Beltestad.
LERØY AND THE NORWEGIAN AQUACULTURE INDUSTRY PERFORM WELL IN INTERNATIONAL COMPARISONS
The Coller FAIRR Protein Producer Index is a ranking of the world's 60 largest publicly traded companies producing meat, fish, and dairy products. They are measured on sustainability, including climate footprint, environmental impact, animal welfare, freshwater consumption, antibiotic consumption, social rights, and more. These measurements form the Coller FAIRR Index. The index for 2023 was announced in November, and Lerøy was ranked second in this index.
We have areas to improve, of course, but this is an important recognition of Lerøy and the work our employees do. Norwegian seafood is among the most sustainable protein we can consume, and Lerøy is proud to serve millions of sustainable meals to the world every day throughout the year, says CEO Henning Beltestad.
OUTLOOK
Compared to the level in the third quarter, release from stock costs in Farming in the fourth quarter are expected to be at the same level, says CEO Henning Beltestad.
Harvest volume, including jointly controlled operations, is expected to be 169,500 GWT in 2023 and 193,500 GWT in 2024. A lower quota affects earnings in Wild Catch. Downstream activities show improvement.
Historically, demand for seafood has held up relatively well in economic downturns. We find that our value chain meets the market's needs, and Lerøy is well-positioned for the future, concludes Henning Beltestad.
Queries may be addressed to CEO Henning Beltestad or CFO Sjur S. Malm.
ABOUT LERØY SEAFOOD GROUP
Lerøy Seafood Group is a global seafood group headquartered in Bergen. The company's approximately 6,000 employees annually handle between 350,000 and 400,000 tons of seafood through the company's value chain, equivalent to about 5 million meals every day. The group has a vertically integrated value chain for redfish and whitefish, as well as significant third-party product activity.
The Group's values, "open, honest, responsible, and creative," are the basis for the Group's total activities, and efforts are made towards the goal of creating the world's most efficient and sustainable seafood value chain. The target for annual return on capital employed (ROCE) is 18%. The group has set ambitious sustainability goals, including a 46% reduction in greenhouse gas emissions by 2030.
To ensure food safety for the consumer, we actively work in all stages of the value chain. As a fully integrated seafood supplier, we have the opportunity to control and quality-assure our products throughout the entire value chain. This way, we can meet the seafood market's increasingly stringent requirements for traceability, food safety, product quality, cost-effectiveness, sustainability, and continuous delivery.
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