The seafood company Aker Seafoods is making changes to its activities in order
to achieve more rational operating units and to improve group profitability.
These adjustments include changes to the fleet and at the processing facilities
to ensure a better product mix and to enhance profits.
The Aker Seafoods group achieved operating revenues of NOK 586 million in the
third quarter, when EBITDA was negative at NOK 13 million. That compares with
NOK 427 million and a positive NOK 27 million respectively in the same period
of 2007. Operating revenues and EBITDA for the first nine months were NOK 2 088
million and NOK 121 million, compared with NOK 1 807 million and NOK 176
million respectively in the same period of last year. Third quarter results are
affected by writing down inventories and storage costs for inventory, low
supplies of raw material, and increased fuel prices for the fleet.
- We are finding that European customers are devoting less money in todays
uncertain finance and currency market. The consequances of this is lower demand
from consumers and reduced prices. Aker Seafoods is therefore not achieving its
goals of EBITDA margins of 7.5 to nine percent for this year, says Aker
Seafoods CEO Yngve Myhre.
- Yet, we are seeing that the sum of the macro factors are positive. Our quotas
are increasing considerably in 2009. At the same time, fuel prices are going
down and we have a favourable curency situation, Myhre continues.
For the third quarter isolated, the prices for some products declined while the
inventory went up. Price statistics from the Norwegian Seafood Export Council
support this experience. While prices for frozen cod fillets declined by 11 per
cent from the third quarter of 2007, the corresponding falls for haddock and
saithe were 16 and two per cent respectively. The price of fresh fillets held
up better, with an increase for haddock and saithe but a five per cent decline
for cod. Frozen whitefish products are suffering particularly from rising sales
of cheap substitutes. However, Aker Seafoods has noted that demand and prices
for environmentally certified products are increasing.
Landings of cod during the third quarter were down by 13 per cent from the same
period of 2007, and three per cent for the first nine months. With less saithe
and somewhat less haddock also landed in the first nine months compared with
last year, total landings for the period fell no less than six per cent even
though quotas for these three species have risen.
Norwegian saithe was environmentally certified by the Marine Stewardship
Council (MSC) in June. This is the first fish species to receive such
certification in the Barents Sea, and Aker Seafoods has experienced great
interest, a better product mix and higher market prices for MSC-certified
saithe than other products from this species. Unfortunately, supplies of saithe
were very limited in the third quarter, which means that the volume delivered
to customers was below target.
Primary processing in Denmark has been affected by limited supplies of raw
materials. The decision has accordingly been taken to shut down two small
Danish plants and concentrate all primary processing in one facility. Secondary
processing did well, particularly with sales of consumer-packed fresh products,
and the new Minna concept is working well.
Prices for trout at Aker Seafoods France have been put under pressure by
competing products, not least from Norway. As expected, high temperatures meant
low biomass growth during the summer months. However, production of
consumer-packed products based on fresh raw material from Norway and Denmark is
rising.
For more information, please contact:
Yngve Myhre, CEO, Aker Seafoods ASA. Telephone +47 24 13 01 60
Gunnar Aasbø, CFO, Aker Seafoods ASA. Telephone +47 24 13 01 60
www.akersea.com
