GuruFocus - Release Date: November 14, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Austevoll Seafood ASA (ASTVF) reported a strong quarter with significant contributions from the pelagic segment, particularly in Peru and Scottish Seafarms.
- The company achieved an operating revenue of NOK 9.2 billion and an EBIT of NOK 1.2 billion, showcasing solid financial performance.
- Year-to-date revenue reached NOK 26 billion with an EBITDA of NOK 5.9 billion, indicating robust growth.
- The company has a strong balance sheet with total assets of NOK 52 billion and an equity ratio of 53%.
- Austevoll Seafood ASA (ASTVF) expects increased quotas in Peru and Chile, which could lead to higher catch volumes and improved future performance.
- The salmon and whitefish segments experienced a decrease in revenue and earnings due to lower price achievements and increased costs.
- The company faced challenges with high sea-lice pressure, impacting net growth and increasing treatment costs.
- Quota reductions in the wild catch segment have been challenging, leading to lower raw material availability and increased prices.
- Fishmeal and fish oil prices have decreased year-on-year, impacting revenue from these products.
- The company has lowered its expectations for 2024 salmon volumes in Norway, indicating potential challenges in meeting previous targets.
A: Arne Mgster, CEO: The pelagic segment has shown a considerable increase in EBITA, primarily driven by our operations in Peru. The second season started in November with a quota of 2.5 million tons, which is significantly higher than last year. Our quota is 175,000 tons, up from 86,000 tons last year. The biomass is 10% above the average of the last decade, indicating a strong performance in this segment.
Q: How has the salmon segment performed, and what are the expectations for the future?
A: Arne Mgster, CEO: The salmon segment's EBIT is down NOK 200 million, mainly due to lower price achievements and increased costs from sea lice treatments. We expect to harvest 170,000 tons in Norway this year and project 195,000 tons for 2025, including Scottish Seafarms. The market remains volatile, but we anticipate improvements in the coming year.
Q: What challenges are you facing in the wild catch segment, and how are you addressing them?
A: Britt Kathrine Drivenes, CFO: The wild catch segment is facing challenges due to reduced quotas, impacting both fleet and plant operations. While prices have increased, they haven't fully compensated for the lower quotas. Cod prices are up 25%, haddock 52%, and saithe 6%. We expect quotas to continue decreasing next year, which will be challenging.
Q: Can you provide insights into the financial performance and balance sheet strength?
A: Britt Kathrine Drivenes, CFO: Our operating revenue for the quarter is NOK 9.2 billion, with an EBIT of NOK 1.2 billion. Year-to-date revenue is NOK 26 billion, with a strong balance sheet showing total assets of NOK 52 billion and an equity ratio of 53%. Net interest-bearing debt stands at NOK 6.5 billion, indicating a robust financial position.
Q: How is the market outlook for fishmeal and fish oil, and what impact does it have on your operations?
A: Arne Mgster, CEO: Fishmeal production has increased significantly in Peru, leading to a decrease in prices by approximately $200 per ton. Fish oil production is also up, with prices dropping to around $3,000 per ton. This increased production and lower prices are expected to positively impact our operations, particularly in Peru.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.