Tough winter for Icelandic salmon farmer Kaldvik

Operating revenues for Iceland salmon farmer Kaldvik rose to €46.8 million (£38.8m) in the final quarter of last year, up from €32.6m in the same period the previous year. However, the operating result before biomass value adjustment and production tax ended at €-18.1, compared to a positive result of €4.6m in the fourth quarter of 2023.

Despite the challenges, adjusted operating profit (adjusted for a one-time write-down of biomass) was €5m, which is an improvement from the previous year, reports Fish Farming Expert's Norwegian sister site, Kyst.no.

Kaldvik, which is majority-owned by Norwegian family-owned salmon farmer Måsøval, has had to book a significant biomass write-down of €23.1m. The company points to high mortality in the 2022 and 2023 generations of fish, winter problems and delays in smolt stocking as the main reasons.

Winter sores

“We experienced challenges with smolt transport and winter-related sores on the fish, caused by lower-than-expected temperatures,” the company writes in its quarterly report.

At the end of the year, there were 1.2 million fewer smolts in the sea than planned.

Kaldvik harvested 6,668 gutted weight tonnes of salmon in Q4, up from 4,202 gwt in the same period the previous year. This brings the total volume for 2024 up to 14,965 gwt, compared to 4,395 gwt in 2023.

The average sales price achieved in Q4 was €6.9 (NOK 79) per kilo, slightly lower than the €7.1 per kilo in Q4 2023. Adjusted for the biomass depreciation, EBIT per kilo was €0.76, compared to €1.09 in Q4 2023.

Harvest forecast lowered

The company has adjusted its 2025 harvest forecast to 21,500 gwt, down 3,500 gwt from previous forecasts. In the first quarter of 2025, a harvest volume of 5,500 gwt is expected.

In 2025, the company plans to release 7.5 million smolts, an increase from 5.6 million in 2024.

To reduce biological risk, Kaldvik has vaccinated all fish in the 2024 and 2025 generations against winter-related wounds and infectious salmon anaemia. The capacity for smolt releases has also been increased to ensure earlier releases.

Acquisition and new licence

Kaldvik has entered into a non-binding agreement to acquire strategic assets, including the one-third of Búlandstindur slaughterhouse that it doesn’t already own, and a packaging factory in Djúpskel. 

The purchase price is estimated at NOK 190m (£13.5m), and the transaction is expected to reduce packaging and production costs by over €3m annually.

The company is also awaiting regulatory approval for a new aquaculture permit in Seyðisfjörður, which could provide 10,000 tonnes of additional capacity. The application is in its final stages of processing, and a decision is expected during the first half of 2025, the company says in its Q4 report.

Refinancing process

Kaldvik has initiated a refinancing process, as the company’s current loan facilities expire in the second quarter of 2026. Net interest-bearing debt increased to €166m in Q4, up from €158m in the previous quarter. The company has received temporary relief from certain loan covenants, including a minimum liquidity requirement of €10m.

“We expect to have the refinancing in place by the end of the second quarter of 2025,” the company states.

A presentation of Kaldvik's Q4 2024 results will be held at 11:00 (CET) / 10:00 Icelandic time (GMT). Chief executive Roy-Tore Rikardsen and chief financial officer Róbert Róbertsson will present the results. 

The session will be held in English and will be held digitally. Watch the live broadcast here: www.kaldvik.is/live