Mowi reports record Q3 earnings, Scotland doubles profit

Mowi today unveiled record high 2023 third quarter revenues of €1.36bn (£1.18 bn) with Scotland more than doubling its operational profit or EBIT.

The global operational profit was €203m (£176.5m) of which its Scotland operation contributed €9.2m (£8m) up from €4.2m (£3.6m) a year ago.

The group said the performance during the July to September period was driven by record high volumes, solid demand and favourable salmon prices.

Mowi harvested an all-time high 135,000 tonnes of salmon in the quarter. Full-year harvest volume guidance for 2023 is maintained at a record-high 484,000 tonnes.

Guidance for 2024 of 500,000 tonnes also marks a new record and a milestone achievement for Mowi, said the report, compared with 375,000 tonnes just five years ago.

CEO Ivan Vindheim said: “Volume growth across the value chain is one of Mowi’s strategic pillars. Growth within Mowi Farming has been impressive in recent years where crossing 500 000 tonnes in farming volumes particularly stands out.”

Consumer products delivered another strong quarter operationally and financially, with seasonal record volumes and operational results.

“The strong results were driven by first-rate operational performance, increased volumes and continued good demand for salmon. Despite a challenging economic environment with generally higher cost of living, demand for salmon remained robust,” Vindheim added.

Earnings in the Feed segment were seasonally record-high on strong volumes and solid operational performance. Volumes from the Norwegian plant were record-high on the back of continued strong growth in sea and increased feed requirements in Mowi Farming Norway.

Ivan Vindheim, Mowi CEO

Scotland produced a slightly higher harvest of 14,730 tonnes during the period.

Earnings increased on improved achieved prices, partly offset by higher realised costs, driven by previous inflation, and more challenging environmental conditions, thanks to higher temperatures over time.

The overall price achieved was 27% above the reference price in the quarter (11% above last year).

Contribution from contracts, including contribution from Consumer Products, was positive relative to the reference price in the third quarter of both 2023 and 2022.

The contract share was 49% in the quarter (61%). Harvest volume was stable at 14 730 tonnes gutted weight (14,494 tonnes in the comparable quarter)

The report said: “Released-from-stock costs increased on realisation of previous inflation, mainly related to feed, but also on other items.

“Furthermore, costs were negatively impacted by environmental conditions which have become more challenging over time, compounded by El Niño this year.”

Climate change and jellyfish continue to pose challenging problems.

The report adds: “In the warm sea water conditions micro jellyfish and higher plankton biomass were again evident. Incident-based mortality costs were €7.6m (£6.6m).

“The above-mentioned issues have lingered on in October, and at the time of writing, we expect high biological cost in the fourth quarter. Further to this, the volume guiding for 2023 has been adjusted to 62,000 tonnes from 64,000 tonnes.”

Mowi Ireland turned a loss of €2.6m (£2.2m) in Q3 last year into an operational profit of €1.5m (£1.3m) on a slightly lower harvest of 1,994 tonnes this quarter.

Mowi plans to pay a quarterly dividend totalling NOK 780m (£57m) to shareholders at NOK 1.5 per share.