SalMar Reports Record Harvest Volumes and Strong Financial Performance in 2023
Despite facing operational challenges in the fourth quarter of 2023, Norwegian fish farming company SalMar managed to achieve record harvest volumes and strong financial results. The company battled severe jellyfish attacks and extreme weather conditions during this period. However, SalMar's determination and resilience paid off as they reported a robust financial performance for the year.
Highlights of SalMar's Financial Performance
SalMar proposed a dividend of NOK35 per share for the 2023 financial year, indicating their confidence in their achievements. The company has also seen an improvement in their financial position, with an increase in earnings before interest, taxes, depreciation, and amortization (EBITDA) and operational EBIT. SalMar's liquidity now stands at an impressive NOK8.9 billion.
Investments and Growth Outlook
Looking ahead, SalMar has big plans for 2024, with substantial investments in the pipeline. Despite the challenges faced in 2023, the company maintains a positive outlook on their growth potential. They anticipate limited supply growth in the market and strong global demand for their high-quality fish products. SalMar aims to leverage their existing licenses and value chain to meet this demand.
Company Outlook and Expectations
SalMar intends to keep their cost level high throughout 2024, ensuring that they maintain their position as market leaders. The volume guidance for the year remains unchanged, with expectations for growth in the Norwegian market, as well as at SalMar Aker Ocean and Scottish Sea Farms.
Financial Position and Revised Volume Expectations
SalMar's strong financial position is evident in their increased EBITDA, operational EBIT, and solid equity ratio. This provides them with a solid foundation for their investment plans. In fact, SalMar plans to invest NOK1.9 billion in 2024 to further support their growth trajectory. The company has also revised their volume expectations for Norway in 2024 to 237,000 tons.
EU Investigation and Operational Challenges
Despite their achievements, SalMar is not without challenges. The company is currently under investigation by the EU for potential competition law violations. This presents a potential hurdle for the company's operations. Additionally, operational challenges faced in the first quarter of 2024 led to higher costs and lower expected volume.
Scottish Sea Farms and Q&A Highlights
Scottish Sea Farms, a subsidiary of SalMar, reported a weak result in the fourth quarter of 2023, with low volume and negative operational EBIT. This adds to the challenges faced by SalMar. During the Q&A session, the company discussed their financial results, operational challenges, and their investment plans for 2024. SalMar also addressed the ongoing EU investigation and its potential impact on their operations.
SalMar's Promising Future
Despite the obstacles, SalMar's strategic investments, focus on efficiency, and commitment to fish welfare put them in a strong position for the coming year. Their solid balance sheet and clear vision for the future ensure that they are well-prepared to capitalize on the strong global demand for their products.
Analyst comment
Positive news: SalMar achieved record harvest volumes and strong financial results in 2023, with increased EBITDA and operational EBIT. The company plans substantial investments in 2024 and expects limited supply growth and strong global demand for its products. It proposes a dividend of NOK35 per share.
Analyst view: Despite operational challenges, SalMar’s strong financial performance and positive outlook on growth potential indicate a promising future. With increased investments, improved financial position, and high global demand, the market is expected to continue favoring SalMar in the coming year.
