Q4 losses in Grieg Seafood
One-off items and write-downs have a strong negative impact on the 4Q result. Continued strong growth. The Group s operating income increased to 354.7 MNOK (+23%). New financing of total 236 MNOK established to fund the production growth in 2009/2010.The depreciation of NOK in 4Q has caused a temporary unrealized currency loss of 140 MNOK. Write-downs of in total 200 MNOK, mainly on goodwill and license values. Underlying improvement in seawater production, in particular in Norway. Grieg Seafood s result in 4Q is negatively influenced by write-downs and one-off items. Fixed assets of 200 MNOK has been written off. This relates mainly to goodwill, excess value of assets and production licenses in Finnmark, in addition to write-downs on biomass in the Shetlands relating to the previously reported salmon lice issue and ISA on one site. The Group s EBIT before IFRS adjustment of biomass in 4th quarter was -245.6 MNOK, compared to 5.6 MNOK in 4th quarter 2007. EBIT before IFRS adjustment of biomass was negatively influenced by this and the result was -20.1 NOK/kg, compared to 0.55 NOK/kg in 4th quarter 2007. The result in Rogaland is negatively influenced by harvesting out sites previously hit hard by Pancrease Disease (PD), while the underlying biological production in Rogaland has improved considerably during the quarter. In Canada the quarterly result was negatively influenced by a weaker US market and a temporary sharp decline in realized sales prices, caused by a high market supply of small fish from Chile.
The salmon market in 4th quarter was mixed, but with continued good prices both in Norway and the UK, supported by weaker local currencies. In the beginning of 2009, Grieg Seafood established an extended financing consisting of increased credit facilities from the bank syndicate as well as a subordinated convertible bond issue from the shareholders. This should finance the company s production growth in 2009/2010. The company s growth strategy is to a large extent implemented, and the focus going forward will be on improving profitability without increasing the smolt entries nor the production.
