File photo of Grieg Seafood chief executive Andreas Kvame at the cage edge in Norway. Grieg had a tough Q4 but will see better results this year, Kvame says.

Grieg's profits fall after challenging Q4 

Salmon farmer reports difficulties in Norway and Canada but points to improved fish health in 2024


Norway and Canada salmon farmer Grieg Seafood’s pre-tax profit for 2023 fell by 42% compared to 2022 after what chief executive Andreas Kvame described as a “tough” fourth quarter.

Grieg made an operating loss of NOK 67 million (£5.07m / Can $8.7m) in Q4, due to various factors. This compares to an operating profit of NOK 156m in Q4 2022.

Operating profit for the year was NOK 779.9m, less than half of 2022’s operational EBIT of NOK 1.739.5 billion. Pre-tax profit was NOK 844.2m (NOK 1.447.6bn).

Net profit, which for the first time included provision for Norway’s 25% “resource tax” levied on the salmon sector, was NOK 259.8m in 2023, down from NOK 1.153.8bn in 2022.

Spiro parasite

“Our results in the fourth quarter were impacted by continued weak biological performance in Finnmark,” said Kvame. “The Spiro parasite, winter ulcers and jellyfish have impacted survival rates and operational efficiency in Finnmark and led to reduced volumes, increased handling cost and lower price achievement. I am not satisfied with the results, and we have taken measures to address the challenges both in the short and medium term.

“The Spiro alone is estimated to cause a total loss of NOK 900 million since it was detected in 2022 at our freshwater facility in Finnmark, most of which has previously been realised. We have implemented measures to prevent Spiro from entering our facility again with good results. All fish that were transferred to the ocean farms in 2023 were Spiro free, and we expect impact from Spiro to cease after we have harvested out the last fish groups from the 2022 generation during Q2.

First harvest

“In Newfoundland, we successfully conducted the first harvest with a volume of 3,184 tonnes, a superior share of 97% and favourable reception from the North American market. The seawater production in Newfoundland continues to be strong with a 12-month survival rate of 95%.

“It has been a tough quarter, and my colleagues have worked hard in all regions to implement improvement measures and move forward. I want to thank them all for their efforts. I am confident that we are on the right path and that we will see results during 2024.”

Operating profit for 2023 was NOK 28.3m in Grieg’s Rogaland region (mid Norway), which was slightly higher than the NOK 26.6m made in 2022. But 2023 operating in Finnmark was down from NOK 25.7m in 2022 to NOK 13m.

In Canada, Grieg farms salmon in both British Columbia on the west coast and in Newfoundland on the east, where it has exclusive rights to farm in Placentia Bay. Both operations lost money.

Reduced loss in BC

Grieg Seafood BC harvested 6,038 gutted weight tonnes and made an operating loss of NOK -7.9 per kilo, which was a better result than the NOK -22.9 per kilo operating loss made in Q4 2022, when the harvest was 1,467 gwt. A broad distribution of Grieg’s BC sites means harvest volumes vary substantially year on year.

Farming cost in Q4 was impacted by historical biological issues and write downs. However, seawater performance was good during the quarter, with a 12-month survival rate of 91%.

Grieg BC harvested 17,682 gwt in 2023 (2022: 20,286 gwt) and made an operating loss of NOK -93.9m (Can $12.1m), which worked out at NOK -5.3 per kilo.

Weather delay

In Newfoundland, total harvest volume during the quarter was 3,184 gwt. This was 1,800 tonnes below guidance, with harvesting postponed to 2024 due to weather conditions and positive market expectations. Realised price was NOK 74.0 per kg and the superior share was 97%.

Grieg NL made an operating loss of NOK -88.9m for the quarter, and NOK -146.1m for the year. Operating loss per kilo in Q4 was NOK -27.9.

Grieg harvested 71,200 gwt in Norway and Canada last year and is guiding for 81,000 gwt in 2024, including 15,000 gwt (-15%) in BC and 11,000 gwt (+244%) in Newfoundland.