August 10, 2009
Cermaq reports Q2 profit up from higher feed and fish prices
Norwegian aquaculture and fish feed company, Cermaq ASA reported a second quarter profit (EBIT pre fair value) of NOK 81.4 million (Norway Kroner) or US$13.35 million due to higher profits in fish feed division.
In the same quarter last year, the company incurred a loss of NOK 31.2 million in the same quarter last year. The profits were achieved in both the fish feed division, EWOSand the salmon farming division, Mainstream.
The improvements in EWOS'' performance were due to to lower raw material costs whereas Mainstream had better results following lower losses in Chile than in 2008 and improved profits in Canada and Norway, due to better sales prices.
Cermaq''s operating revenue for the quarter was NOK 2,170.0 million, almost the same as for the same quarter in 2008. However this came from lower sales volumes of both fish and feed, which was compensated by higher sales prices for both commodities.
A major risk in EWOS in Chile is the possibility of a bad debt. Improvements were made in the quarter with a reduction in total receivable exposure of 20 percent from the end of the first quarter, but there is still a significant risk that a customer defaults in the coming period.
Mainstream''s operating revenue in the second quarter of 2009 were NOK 607.2 million. Volumes were 22 percent lower than the comparable period in 2008 due to lower sales lower sales volumes of coho and trout as a result of selling more in the first quarter in 2009. The reduction in volumes was more than compensated by higher sales prices in both local currency and Norwegian kroner in all the three large farming regions Chile, Norway and Canada. Mainstream''s EBIT pre fair value for the second quarter was a profit of NOK 32.1 million compared to a loss of NOK 54.7 million in the same period in 2008.
US$1 = NOK6.09 (Aug 10)