EBITDA ratio doubled from last year
Loss 11.4 million for the year 2006
Restructuring cost expensed 20 million for the year 2006
Fourth quarter
" Sales amounted to 358.3 million, up 18.5% from the preceding year
" EBITDA for the quarter amounted to 2.0 million
" Cost of plant closure in the USA expensed during the quarter amounted to 12.7 million
" Increase in the cost of merging Icelandic Germany and Pickenpack H&H amounted to 2.1 million
" EBIT for the quarter amounted to 14.5 million
" Net loss amounted to 14.7 million
2006
" Sales amounted to 1,471.3 million
" Increase in income was 22.6%, of which all was external growth
" EBITDA for the year amounted to 36.9 million
" Earnings before interest and taxes (EBIT) amounted to 5.5 million
" Net loss amounted to 11.4 million
" Cash used in operating activities before taxes and interest amounted to 17.4 million
" Total assets amounted to 906.8 million - equity ratio 19.4%
" Return on equity was negative by 5.7%
" Cost of restructuring at Coldwater Seafood UK was 1.6 million
" Cost of restructuring in France was 2.8 million
" Total cost of restructuring during the year 20 million
Björgólfur Jóhannsson, CEO of Icelandic Group: "We have been improving a number of operating units during the year that have not been showing acceptable results. The cost of these measures has been considerable, amounting to a total of 20 million. The largest single item was the expensing in Icelandic USA, amounting to a total of 12.7 million. In addition, the entire cost of closing the Company's plant in Cambridge, scheduled for 2007, has already been expensed in the accounts. The restructuring work at Coldwater Seafood UK has taken longer than estimated, as we have pointed out before. The relocation of the UK production to France has also taken longer than expected, but will be completed in the first half of 2007. It is the assessment of the management that the Company is now well placed to return good results in 2007. A number of companies within the Group performed well during the year, such as Icelandic Iberica, Jeka Fish, Icelandic Asia, Seachill, Icelandic UK, Icelandic Norway and Fiskval.
The price of raw material continued to rise throughout the year, which cut into the gross margin of the Group's manufacturing units.
Significant changes have been made in the operation of Icelandic France with the appointment of a new CEO at mid-year. Inventory has been reduced by over a half, from 23 million around mid-August to just short of 11 million at the end of the year. A decision has also been made to relocate all of the company's operations in Paris and to close two offices; one has already been closed. The cost of these measures has been expensed in 2006 together with the inventory write-down and the separation cost of the former CEO at total of 2.8 million.
Extensive work has been done on taking the Coldwater Seafood UK plants out of the production of frozen products and into the production of chilled and ready meals, incurring an expense over the year of 1.6 million. The Company management is optimistic as regards these changes and we anticipate that the changes will start to pay off as early as the first half of this year.
At Icelandic USA we are working according to a plan which provides for acceptable results in 2007; the final stage of the plan was presented last December, when the Company announced the sale of the Icelandic USA plant in Cambridge, Maryland, in 2007. The entire cost of the closure is expensed in 2006, including depreciation of fixed assets in the amount of 9.5 million and projected separation costs amounting to 3.2 million.
The results returned by Pickenpack H&H over the year were disappointing and far short of projections.
The third quarter report revealed that the fourth quarter was an important period for the company's results. Sales were projected at 400 million, and there were anticipations of an EBITDA ratio of 4.5%. Sales during the quarter fell short of budget projections by 40 million, and the EBITDA ratio was rather far short of the expected figure. The discrepancy is a result of closure costs and the longer duration of the restructuring process than expected, in addition to the fact that the turnaround of the production units was less than anticipated.
