Samherji reports increased revenue, falling profit

Samherji, Iceland’s largest seafood business, saw increased revenue in 2023 but its net earnings fell by 39% thanks to restructuring which saw the disposal of some of its operations.

The Samherji operating profit was €54 million euros or 8.1 billion Icelandic kroner.

The company, which is engaged in both aquaculture and conventional fishing sold its European and North American operations at the start of 2023 to Baldvin Thorsteinsson, the son of the CEO, Thorsteinn Már Baldvinsson.

Overall Samherji said it had a successful year in aquaculture, fishing and processing and products sales. Revenue totalled €419m (£353.4m) in 2023, marking a 10% increase in product sales revenue from the previous year.

EBITDA (earnings before interest, tax, depreciation and amortisation) was up from €69.9m to €74.6m (£63m) for 2023, but net earnings, after adjusting for the loss of discontinued operations, totalled €58.7m (£49.5m), down from €101.2m (£85.3m) in 2022.

“Core operations” were stronger than in 2022, the company said, with increases in revenue and earnings before depreciation and financial items. Considerable changes have been made to the balance sheet in recent years and 2023 was the first full operating year in which the group’s activities spanned only fishing, fish farming, processing and selling marine products.The actual decline in profits year-on-year was partly down to the effects of restructuring in 2022.

The company’s largest investment during the year involved expanding the land-based fish farming facility in Öxarfjördur, north eastern Iceland, through the subsidiary Samherji Fish Farming, which has more than two decades of experience in land-based aquaculture.

The investment for expanding the facility in Öxarfjördur amounted to €27m (£23m). The facility is expected to produce around 3,000 tonnes of salmon annually.

The company said the knowledge and experience gained from operating this facility will be utilised in Samherji Fish Farming’s proposed land-based salmon farm in the Reykjanes Peninsula (in south west Iceland).

CEO Thorsteinn Már Baldvinsson, said: “Samherji’s operations performed well last year, and the company’s finances are strong, as the annual financial statements clearly show.

“During the year, we faced various challenges, and the company’s employees deserve praise for solving them with resourcefulness and diligence.”

Samherji sells almost all its products in foreign markets, where interest rates have spiked due to increased inflation. Wars have also had a major impact on international trade. In such situations, solid business relationships and strong sales networks prove their importance.

He added: “Forces of nature reminded us of their power in the second half of the year when seismic activity began in Reykjanes, forcing the residents of the town of Grindavík to leave their homes.

“This sequence of events had direct and indirect effects on the operations of Samherji Fish Farming. We celebrated Samherji’s 40th anniversary in its current form in 2023, and I can only be optimistic about the future.”