Amidst political tensions, BC farms led Mowi’s earnings recovery in Canada

One seldom hears “fantastic” and “a hot potato” in the same breath but these were what Mowi CEO Ivan Vindheim called the group’s British Columbia operations during the announcement of Q2 results on Wednesday.

It is fantastic indeed because BC led the turnaround in the fortunes of the Canadian operations. At the same time, losses in Newfoundland due to ISA have somewhat abated.

Earnings have significantly improved for the Canadian operations in Q2 2022, spurred by western Canada which posted an all-time-high operational EBIT of €38.3 million (US$38.1 million) in the quarter.

This amounted to €3.87 per kg due to this year’s strong prices, up from negative €0.51 per kg in Q2 last year.

Read also: Mowi CEO: “It has been a bad summer for people, but a good summer for the salmon”

Harvest volume in British Columbia was 9,921 tonnes, up from 7,687 tonnes in the comparable quarter on the back of higher biomass going into the quarter.

The combined harvest volumes of the two Canadian operations (East and West) was however down from a year earlier to 10,413 tonnes (GWT), due mainly to the limited growth in Newfoundland.

Biological challenges in the Atlantic province led to a meagre harvest of 492 tonnes for Mowi Canada East, a dramatic 90-percent decline from Q2 last year.

In March, the detection of ISA virus led to the culling of almost 190,000 fish weighing 1.5 kg. ISA outbreaks were seen also this past July and early this August.

“In Canada East, incident based mortality losses amounting to €2.9 million had a negative cost impact. This was mainly related to culling related to ISA (€8.9 million in the comparable quarter),” the Norwegian parent company said on Wednesday.

But aside from the mortalities, the small harvest isn’t surprising as Mowi in January said it was purposely pausing growth in Newfoundland as it deals with the issues.

Now Mowi says Newfoundland farming operations will commence harvesting in Q4 of this year under the watch of the newly appointed managing director, Jason Pringle.

And why is BC “a hot potato”? One can safely say it’s due to the drama around the plan to transition the province away from salmon farming in the ocean. And until a transition plan is in place, Mowi can carry on farming in BC for another two years.

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