Salmar profit of 8,62 NOK per kg harvested salmon

The SalMar Group generated gross operating revenues of NOK 556.3 million in the fourth quarter 2008, compared with NOK 454.3 million in the same quarter in 2007. Operating profit before fair value adjustment of the biomass totalled NOK 134.5 million in the fourth quarter 2008, compared with NOK 68.9 million in the same quarter in 2007. The increase in operating profit can largely be ascribed to a higher harvest volume, higher salmon prices and lower costs in the quarter.

"The SalMar Group performed well in the fourth quarter," said CEOLeif Inge Nordhammer. "SalMar Central Norway improved its margins in both the fish farming and processing activities. The improvements are due to a higher harvest volume, good salmon prices in our core markets and a systematic effort to improve operational efficiency. SalMar Northern Norway also improved its performance compared with the previous quarter. This provides strong motivation to continue working to bring the business unit's results up to the same level as SalMar Central Norway."

Mr Nordhammer also said he was pleased that the company had improved its performance from last quarter. "But we are still working systematically to further enhance our efficiency and increase our competitiveness. A focus on costs and an even stronger focus on the biological aspects of our business is key for us and our future results," he added.

"Demand for salmon in our most important markets is strong, and 2009 has started with higher volumes and better prices than in the corresponding period last year."

The SalMar Group generated gross operating revenues of 556.3 million in the fourth quarter 2008, compared with NOK 454.3 million in the same quarter in 2007. The change can largely be ascribed to a 25 per cent increase in the volume of salmon harvested and sold at somewhat higher prices than in the corresponding quarter in 2007.

The Group made an operating profit before fair value adjustment of the biomass of NOK 134.5 million in the fourth quarter 2008, compared with NOK 68.9 million in the same quarter in 2007. This resulted in an operating profit per kg gutted weight of NOK 8.62 for SalMar Central Norway and NOK 3.44 for SalMar Northern Norway in the fourth quarter 2008.

The board proposes the payment of dividend of NOK 0.40 per share, a total of NOK 41.2 million.

SalMar has a 50 per cent shareholding in Norskott Havbruk AS, which operates fish farming activities on mainland Scotland, the Orkneys and Shetland. The business generated gross operating revenues of NOK 236.2 million in the fourth quarter 2008, and made an operating profit of NOK 10.1 million, compared with NOK 4.8 million in the same quarter the year before.

SalMar's key figure for profit performance under IFRS is EBIT (operating profit) before fair value adjustment of the biomass. Adjustment of the fair value of the biomass results from the requirement to value biological assets (the biomass) at fair value instead of cost price. SalMar reports EBIT before fair value adjustment of the biomass in order to show the underlying performance of its operations during the period.

The SalMar Group, including its 50 per cent shareholding in Norskott Havbruk AS, harvested some 65,100 tonnes gutted weight in 2008 as a whole. This breaks down as follows: 42,300 tonnes in central Norway, 11,400 tonnes in northern Norway and 11,400 tonnes in Scotland/Orkneys/ Shetland.

In 2009 SalMar expects the Group to harvest around 78,000 tonnes gutted weight, with SalMar Central Norway harvesting some 51,000 tonnes, SalMar Northern Norway 14,000 tonnes and Norskott Havbruk 26,000 tonnes, of which SalMar's share is 50 per cent, i.e. 13,000 tonnes.

The price of salmon in the fourth quarter 2008 was approx. NOK 2.3 higher than in the corresponding quarter the year before, but approx. NOK 2.4 lower than in the third quarter 2008. 2009 has started buoyantly, with exports of salmon from Norway around 12 per cent higher in January than in the same period in 2008. The EU market is 14 per cent up on last year, while the increase in exports to Russia continues. Exports to Japan and the rest of Asia, however, are falling. The export price of fresh salmon was considerably higher in January 2009 compared with the same period in 2008, and was also higher than in December 2008.

SalMar expects there to be a relatively even balance between supply and demand for Atlantic salmon in 2009. Despite the continuing turbulence in the global economy, the company therefore expects the price of salmon to remain at a good level in the coming period.