A strong pound and the one-off costs of upgrading a fish processing plant in Rosyth meant that Marine Harvest’s Scottish operations were effectively run at a loss in the last quarter of 2015.
The Norwegian aquaculture giant’s fourth quarter results, posted Wednesday, revealed that the company lost 2.1 Norwegian kroners (17p) on each kilo of the 14,000 tonnes of salmon produced in Scotland during the three-month period.
This was in contrast to its Norwegian-produced salmon where operational earnings before interest and tax (EBIT) were 12.14 kroners (99p) per kilo.
Globally, despite operational revenues rising in the last quarter of 2015 to 8.06 billion kroners (£658m) from 6.86bn kroners (£560m) the previous year, earnings for the world’s largest producer of farmed salmon were down 19 per cent to 837m kroners (£68m) compared with the last quarter of 2014.
The company said it had experienced increased production costs in all its regions apart from Canada. The company’s Chilean operations did particularly badly, with continuing problems with sea lice infestations leading to losses of 12.28 kroners (£1) per kilo, a “challenging” situation that the company expects to persist in 2016.
The last quarter of 2015 was the only quarter of the year in which Marine Harvest’s Scottish produced salmon was loss-making. Between the first and third quarter earnings per kilo of Scottish salmon were in positive territory, rising from 2.7 kroners (22p) to 6.14 kroners (50p).
“Start-up costs at the Rosyth processing plant in Scotland have been higher than previously expected and have as such impacted results negatively by approximately NOK 70m (£5.7m) in Q4 2015,” Marine Harvest said in a trading update.
A spokesman for Bergen-based Marine Harvest said that the high value of the pound had also impacted exports of its Scottish-produced salmon.
In June last year the Oslo-listed company announced it would create 260 new jobs at its Rosyth processing plant after winning a major contract to supply fresh and smoked salmon to Sainsbury’s, taking over a contract previously held by Young’s Seafood.
Young’s Seafood cut 650 jobs in Fraserburgh and Grantown on Spey after losing the Sainsbury’s contract.
Marine Harvest’s Fife plant previously employed 90 staff but this is set to rise to around 350 as volumes increase five-fold.
Last month Marine Harvest announced it would cut 100 jobs at its Scottish operations, following a drop in production, a profit warning and a need to “make the business more efficient and sustainable”.
The company currently employs 658 people at more than 50 sites around Scotland, which include 48 sea farms, five freshwater loch sites and four hatcheries. The farms are situated across Skye, the Western Isles, Lochaber, Wester Ross and Argyll.
Marine Harvest’s last full year results, for the year to December 2014, showed turnover on its global operations of 25,531.3m kroners (£2.08bn) and profits of 939.5m kroners (£76.5m).
The firm expects to harvest 436,000 tonnes of salmon worldwide in 2016, up from 420,149 tonnes in 2015.
During the 2014 calendar year Marine Harvest (Scotland) Ltd reported a turnover rise of 4.4 per cent to £218.6m while pre-tax profits fell 35 per cent to £40.4m.
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