Greenland state-owned fishing company Royal Greenland had a tumultuous 2024 marked by operational improvements but challenging impairment charges.
Profit before tax was negative DKK196 million (-$29.7 million), while revenue was DKK5.6 billion, reflecting a slight decline in the top line, despite a two per cent increase in volumes sold.
"Our clear goal is to rebuild a healthy business and deliver an EBIT margin of five per cent," said the company. "A profit is expected in 2025."
Primary operations improved by DKK116 million compared to 2023, driven by stronger catches of several core species such as snow crab, cod and cooked and peeled prawns – with the exception of shell prawns.
"2024 has been a year marked by necessary but difficult decisions to ensure a stronger and more robust company in the future. We see this as positive," said Royal Greenland.
"However, operations have not yet returned to previous levels, and combined with the impairment losses made, the result for the year is not satisfactory for Royal Greenland."
The overall cod category is now profitable, supported by trawler fishing in East Greenland and the Barents Sea as well as an increase in the production of Nutaaq cod to 10,000 tonnes.
Greenland halibut experienced strong demand in key markets in China, Japan and Taiwan, and sales to the US market are growing. The cooked and peeled prawn category also showed positive trends, where more efficient production and higher sales prices have made it profitable again.
"I am pleased that we have achieved solid results in both cod, halibut and cooked and peeled prawns," said Preben Sunke, interim CEO of Royal Greenland.
"Our land-based cod production in Greenland is in balance for the first time, and we see stable demand and rising prices across Europe, Asia and North America. This gives us a good starting point for 2025.
“As part of our action plan, we implemented extensive efficiency improvements in 2024, which resulted in savings of DKK52 million, which, together with the improved market conditions, improved operating profit by DKK116 million compared to 2023.
"The effects of the action plan will continue into 2025, and we expect to return to positive earnings in 2025."
Despite the operational improvements, the annual result was negatively impacted by challenges abroad.
"The expected returns from our activities [in Chile] have not materialised, which has led to an impairment of receivables of DKK220 million," said the company. "We are now conducting a thorough evaluation of the future of our Chilean business."
In Norway, a Royal Greenland partner was not given access to the expected crab licenses, which has meant that the partner will not be able to start fishing in 2025. On this basis, the company has written down its receivables by DKK57 million.
In total, these write-downs amount to DKK277 million, which had a significant effect on the annual result, added Preben Sunke.
"During 2024, we reduced our net interest-bearing debt by DKK264 million," said Royal Greenland.
"This means that our financial leverage is now at 7.7 compared to 37.7 last year – a significant step in the right direction.
"With a strengthened core business and a clear strategic direction, we have laid a solid foundation for a positive development for the benefit of Greenlandic society.
"The first months of 2025 show promising development, and we look forward to a year of progress and strengthened competitiveness."