Scotland drags down Bakkafrost 2023 results while American market grows in importance

Editorial Staff

North America now accounts for 25% of the salmon produced by Bakkafrost in the Faroe Islands.

Faroese salmon producer Bakkafrost saw an increase in profits for the final quarter of 2023 despite a significant fall in harvest volumes.

The total combined harvest of the farming segments in the Faroe Islands and Scotland was 17,067 tons gutted weight in Q4 2023, leading to a total harvest of 73,006 tons for the year 2023, down from 91,000 tons for 2022, a 20% decrease.

In the fourth quarter of 2023, Bakkafrost reported revenues of DKK 1,562 million ($225 million), a decrease from DKK 1,940 million ($280 million) in the same quarter of the previous year.

The operational EBIT for this quarter was DKK 356 million ($51 million). For the full year of 2023, the company’s revenues reached DKK 7.1 billion ($1 billion), with an operational EBIT of DKK 1.5 billion ($217 million), and they harvested a total of 73,000 tons.

Regional variations

The performance of the company varied significantly by region.

The company’s farming operations in the Faroe Islands showed strong performance in the fourth quarter, while the Scottish operations faced challenges due to higher seawater temperatures and biological hazards. However, improved biology since mid-September 2023 in Scotland led to lower mortality, according to the company.

In the Faroe Islands, Bakkafrost achieved revenues of DKK 1,478 million ($213 million) and an operational EBIT of DKK 460 million ($66 million).

Meanwhile, in Scotland, the revenues were markedly lower at DKK 84 million ($12 million), with an operational EBIT of DKK -104 million (-$15 million).

The company continues to believe that its so-called large smolt strategy for Scotland will eventually see results more in line with its Faroese operations.

CEO Regin Jacobsen commented on the results, noting the strong performance in the fourth quarter, particularly in terms of operating margin.

“I am proud of the progresses from the high focus on fish health and welfare in the Bakkafrost’s operation in the Faroe Islands, which have resulted in a very robust and strong farming regime,” said Jacobsen.

Looking ahead

Looking ahead, Bakkafrost expects stable supply and prices in the salmon market. For 2024, a 2% growth in global supply is anticipated. The company plans to focus on diversifying and mitigating market risk across its main markets in Europe, the USA, and the Far East.

For 2024, Bakkafrost aims to release approximately 17.8 million large smolts in the Faroe Islands and around 9.3 million smolts in Scotland.

Bakkafrost’s investment plans for 2024-2028, amounting to DKK 6.3 billion, focus on sustainable growth and transforming operations in Scotland and the Faroe Islands. The company expects to increase its total annual harvest volumes to 165,000 tons by 2028.


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