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Icelandic Salmon Q1 2024: Volume guiding for 2024 unchanged despite challenging first quarter

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Bíldudalur, 14th of May 2024

Icelandic Salmon is the parent company of Arnarlax, and other subsidiaries involved in salmon farming and processing in Iceland. The companies are collectively referred to as “Icelandic Salmon” or the “Group”.

Operations

In the first quarter 2024, Icelandic Salmon harvested 2,769 tonnes compared to 6,572 tonnes in the same quarter last year. The lower volume follows months of extraordinary harvesting at the end of last year, when biological challenges prompted the company to harvest early for animal welfare reasons.

There was biological challenges in the first quarter this year. Mortality rate in the 2023 generation in the sea and at one of the smolt facilities was unusually high, resulting in one-off costs of EUR 3.6 million in the period.

“During this winter, our team has had to face a series of quite unusual operational challenges. We have been reminded that in our industry, we must be able to adapt and quickly adjust our plans. In order to do so, we need robust companies with highly skilled and resourceful people, which we are fortunate to have,” said Bjørn Hembre, CEO of Icelandic Salmon.

The group reported revenues of EUR 27.5 million in the first quarter 2024, compared to 68.9 million in the first quarter 2023. The EBIT for the quarter was negative EUR 0.5 million, which includes the one-off cost mentioned above. Operational EBIT/kg was negative EUR 0.20. Adjusted for one-offs EBIT/kg was EUR 1.1.

Market and strategic milestones

Icelandic Salmon continues to see strong interest for its products. The company benefitted from high average weight on fish sold.

Icelandic Salmon holds licenses for 23,700 tonnes maximum allowed biomass (MAB) in the Icelandic Westfjords. The company expects to be awarded another 10,000 tonnes MAB license shortly, for sterile salmon at three more sites in Ísafjörður.

Outlook

For the year 2024 as a whole, Icelandic Salmon maintains that it expects to harvest 15,000 tonnes. The spring 2022 generation is performing well and shows significant improvements on key parameters.

For the longer-term, we see a potential for growth up to 26,000 tonnes on existing licenses, and based on the results we see of quality on smolt and the performance of our spring 2022 generation, we expect to get there soon. We are a committed team with strong company culture, and with a value chain which is well prepared to handle higher volumes,” said Bjørn Hembre, before concluding:

As a leading producer of salmon, we are concerned that the uncertainty of the process with implementing new aquaculture law has introduced could be making it more difficult for Iceland to build further on this new pillar of our economy where competitiveness is of key importance in the global markets. We remain committed, however, to work with policy makers and other stakeholders to establish a balanced, competitive and predictable legal and fiscal framework going forward.

Presentation details

Attached is the presentation for the first quarter 2024.

The company’s CEO Bjørn Hembre and CFO Jónas Heiðar Birgisson will be presenting the company’s results at 9:00 Icelandic time (11:00 CEST). The presentation will be held in English via webcast, please copy and paste the following link into your browser: www.arnarlax.webcast.is.

There will be a Q&A session after the presentations so you can send in questions during the presentation to questions@arnarlax.is

A recording of the presentation will be made available on the company’s website.

After the presentation there is an opportunity to book one-on-one meeting either at our office in Reykjavík (Borgartún 18) or on Teams between 10:15 – 15:00 Icelandic time, if interested, please send an email to hjortur@arnarlax.is

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