Grieg Seafood pledges transformation after horror year

Norway's Grieg Seafood has pledged to undergo a transformation of its business after a horrendous year in which profit before tax plummeted from NOK844 million ($75.7 million) to negative NOK2.6 billion (-$233 million).

Compared to the fourth quarter of 2023, Q4 2024 profit before tax slipped from NOK303 million to negative NOK1,590 million.

"While Rogaland continued to deliver strong operational and financial performance, the fourth quarter continued to bring difficult operating conditions and adverse biological events in Finnmark," said CEO Andreas Kvame.

"In Canada, we maintained a cautious approach in British Columbia given the persisting political uncertainty and worked to find a good way forward for our operations in Newfoundland. Due to changes and uncertainty in Canada we have recognized impairment losses of NOK1,737 million.

"Overall, we delivered slightly lower harvest volumes than expected and report an operational EBIT-loss of NOK74 million for the quarter. Operational EBIT for the full year 2024 was NOK8 million, compared with NOK780 million in 2023. That is not satisfactory.

"We have a great asset base but are currently not capturing the full value potential."

Kvame blamed operational and biological challenges on the affected results and cash flow, as well as a capital intensive post-smolt programs to support the company's growth capabilities.

"In combination, this has put strains on our liquidity position and financial flexibility," said Kvame.

"Acknowledging the need for action, we have launched a transformation program to lay the financial and organizational foundation for profitable and sustainable growth going forward.

"This includes reallocating resources towards our strong Norwegian assets base, while maintaining our position in Canada, efforts to secure financial strength, and sharpening of the operational initiatives we are running.

Kvame said the company would be focusing its efforts on sustainable and profitable growth in its Norwegian operations while protecting the value of its Canadian assets.

"This requires a solid balance sheet and strong financial fundament, and we are contemplating issuing a NOK1.5-2.0 billion hybrid bond loan that will add to equity and strengthen financial flexibility," said Kvame.