Sale of Norwegian salmon products at a supermarket. (Photo: Terje Engo)

Morpol's Q4 harmed by high salmon prices

NORWAY
Monday, February 28, 2011, 00:40 (GMT + 9)

Persisting high salmon commodity prices that remained in the fourth quarter of 2010 had a downbeat effect on Morpol AS’s processing margins.

Yet, the farming segment has profited from the high prices. The Morpol Group’s net profit of continuing operations was EUR 11.9 in the fourth quarter compared to EUR 18.9 million in Q4 2009.

The firm reported a positive EBIT result for the quarter at EUR 12.3 million, including one off exceptional costs pertaining to acquisitions at EUR 0.65 million, leading to an operational EBIT of EUR 12.9 million. In contrast, the EBIT in the fourth quarter of 2009 was EUR 22.1 million.

Operating revenues for Q4 2010 rose above those of the previous year at EUR 163.1 million compared to EUR 138.9 million. The increase came principally as a result of farming revenues not included in 2009 and greater processing volumes.

Morpol’s total sales volume escalated by 19 per cent year-on-year with a positive volume development compared to 2009 in all categories except Specialities. Cold smoked salmon sales continued to grow and demand for salmon remains high despite having decelerated in the second half of 2010.

"Given the extreme conditions in the quarter, with severe weather in December and record high salmon prices, Morpol delivered a good result. We increased prices for our products in the period, and we continued to experience strong sales growth," affirmed CEO Jerzy Malek. 

Morpol has included the companies acquired during Q3 2010 in its consolidated results for the fourth quarter. The seabass/bream in Spain under Culmarex and cobia operations in Vietnam and Belize purchased from Marine Farms as classified as held for sale and presented as terminated operations.

"Our focus remains on producing stable, good quality products designed to satisfy customer needs. We will exploit the most attractive markets and we believe the entry into salmon farming will provide a platform for further expansion. With higher consumer prices in 2011 and increased global supply in the second half, it remains to be seen what the impact will be on raw material prices," concluded Malek.

Additionally, Morpol saw a net interesting bearing debt (NIBD) of EUR 148 million at the end of Q4 2010, having dropped from EUR 156 million at the end of the previous quarter. The drop occured mainly due to higher cash balances resulting from the equity issue of approximately EUR 38 million made in December.

Related articles:

- Morpol buys Jøkelfjord Laks AS 
- Morpol sees positive results and various acquisitions in Q3 

By Natalia Real
[email protected]
www.seafood.media

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