Smoked Salmon processing. (Photo: Morpol)

Morpol's Q2 shows slight loss but volume rise

Morpol's consolidated  operating revenue this second quarter reached EUR 113.0 million – a slight drop of EUR 0.7 million year-on-year. Operating EBIT amounted to EUR 6.2 million (5.5 per cent margin), which was EUR 2.4 million lower.

Sales volume rose by 20 per cent overall versus Q2 2011 as a different product mix positively impacted the average sales price. Sales of the principal category, cold smoked salmon, dropped by 1.6 per cent in volume but sales of specialty products had strong growth with a 37.1 per cent increase.

Processing generated an operating EBIT of EUR 5.7 million in Q2 2012 versus EUR 2.4 million year-on-year. The operating EBIT margin jumped to 6.3 per cent compared to 2.7 per cent.

Revenue in salmon farming in Q2 2012 was EUR 37.1 million up from EUR 34.6 million in same period last year. The 27 per cent drop in market prices for salmon was compensated by a 24 per cent climb in volumes sold.

Sales volumes were 6,740 tonnes gutted fish with an EBIT/kg of EUR 0.3.

"We are heading in the right direction," CEO Jerzy Malek stated. "A  demand  surge  for  smoked  salmon  and  Morpol's  strategy of diversifying  our  product  portfolio  will  ensure  continued  growth  for  the company."

Gross profit in Q2 2012 amounted to EUR 21.9 million, EUR 0.8 million lower than in Q2 2011. Gross profit in the processing segment improved by EUR  5.3 million (48 per cent), despite only EUR 1.0 million increase in operating revenue, mainly due to a drop in cost of sales as a result of reduced salmon raw material purchase prices.

In Q2 2012 gross profit in the farming segment amounted to EUR 5.8 million versus EUR 11.7 million in Q2 2011.

The group had a net profit of EUR 9.9 million in Q2 2012 against EUR 3.6 million in Q2 2011.  The lower operating EBIT was positively offset by unrealised fair value adjustment on biomass measured at fair value and lower financial costs.

Raw material prices have plummeted since Q2 2011 but increased versus Q1 and this is stimulating demand.

Increasing raw material prices, lower end product prices, particularly for Morpol’s principal product categories and a changing product mix in Q3 2012 will impact profitability. Still, the company said, solid margins should be expected during Q3 as volume growth partially compensates.

Demand will continue to be tested during the third quarter as global salmon supply is expected to grow by approximately 13 per cent compared to last year, but supply growth is slowing and will continue to slow.

Farming salmon prices have remained fairly strong.

“We expect prices to remain at today’s levels in the short term, increasing in the medium term. However, we believe the current  economic turmoil, especially within EU, has resulted in increased price elasticity,” Morpol added.

Related article:

- Morpol's operating revenue falls in Q1

By Natalia Real
[email protected]
www.seafood.media

Address:	Tjuvholmen Alle 3
City:	Oslo
State/ZIP:	(0252)
Country:	Norway
Phone:	+47 90 24 73 83
More about:

 

 

 

 

 

 

Print