A solid quarter: initiatives are having a positive effect
This is a strong performance in a period characterised by significantly lower spot prices for salmon and trout, says Lerøy CEO Beltestad
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Lerøy Seafood Group has delivered strong results for the first quarter of 2025, with an operating profit of NOK 1.05 billion (£76.1 million) – up from NOK 842m in the same period last year, reports Fish Farming Expert's Norwegian sister site, Kyst.no.
In the company's first quarterly report for the year, group chief executive Henning Beltestad points to good development in both aquaculture and processing, despite lower spot prices for salmon and trout.
"This is a strong performance in a quarter characterised by significantly lower spot prices for salmon and trout than the same period last year," says Beltestad.
I rapporten kommer det frem at selskapet har regnskapsført nær 286 millioner kroner i estimert grunnrenteskatt for kvartalet.
The report shows that the company has recorded nearly NOK 286 million in estimated resource rent tax for the quarter.
Measures have impact
The aquaculture segment delivered an operational EBIT of NOK 789m. Beltestad highlights biological improvements as an important factor.
"Improvements in genetics, egg and smolt quality, use of shielding technology and general process improvement are a significant part of the explanation. We are satisfied with the development in aquaculture, and see that the measures we have implemented have a positive effect on fish welfare and thereby also our financial results," he says.
Record for further processing
The Value Added Products, Sales and Distribution (VAP S&D) segment delivered an operational EBIT of NOK 212m in the quarter, and NOK 924 million on a rolling 12-month basis – the highest level ever.
"Large volumes mean higher utilisation of our integrated value chain, and lower raw material prices build markets. It is gratifying to see that as a result of structured improvement work, several of our businesses are performing at a higher level than before," says Beltestad.
The report states that Lerøy has a goal of raising EBIT in the VAP S&D segment to NOK 1.25 billion by 2025, and expects better earnings this year than last year.
An industrial policy warning
The Norwegian government's proposal for a new lice system in aquaculture management raises concerns in Lerøy. The company supports seafood trade body Sjømat Norge's request for a more thorough impact assessment before new principles are introduced.
"The proposed changes are drastic and it is very demanding to assess the consequences," says Beltestad, pointing out that lice treatment frequency has been reduced by 75% for salmon in submerged cages compared to traditional ones.
Negative for the industry and Lerøy
Lerøy sees great opportunities internationally, especially in emerging markets such as China.
"With high volumes at lower prices, we are now developing the market for Norwegian salmon and trout globally. After several years of regulatory unrest, we ask the authorities to facilitate predictable, stable and competitive framework conditions," says Beltestad.
Lerøy also writes that the start of 2025 has been characterized by increased focus on trade barriers, driven by new import tariffs and uncertainty around future import restrictions, particularly to the United States.
"The seafood industry is largely international and based on global trade. In general, trade barriers are therefore negative for both the industry and Lerøy. At the same time, both the industry and Lerøy have long experience in dealing with such restrictions, and global trade flows usually adapt quickly," the company writes.
It adds that so far the effects have been limited, but that an escalation of import duties poses a risk.
