Reference is made to the announcement from P/F Bakkafrost on 25 February 2020 in which the Board of Directors proposed dividend payment for 2019.
Due to the uncertainty caused by the ongoing COVID-19 pandemic The Board of Directors of Bakkafrost P/F have today decided to pull back the dividend payment proposition for 2019 and delay the proposition on dividend payment for 2019 until Bakkafrost’s H1 presentation on 25 August 2020, at which time the Board of Directors expect the level of uncertainty to have reduced.
Over the past several weeks the COVID-19 pandemic has spread across the globe and greatly affected the salmon market, disrupted downstream supply channels and logistics. This situation evolves continuously and creates significant uncertainty which will most likely prevail for some time yet. The level of uncertainty has convinced the Board of Directors and the Management of Bakkafrost that it is most responsible to shareholders, employees and the society to postpone the decision regarding the dividend payment for 2019.
It is important to ensure that Bakkafrost maintains the agility and financial strength to be able to continue the many planned investments in the capex program. These investments enable our ambition for future growth as well as being important for the recovery of the economy in the Faroe Islands and Scotland on the other side of the pandemic crisis.
Bakkafrost has a vital role in the society and in ensuring sufficient food production for the world’s population. This role has never been more important than during the difficult times the world is facing at the moment. It is therefore important to secure continued high level of production and Bakkafrost has implemented a range of protective measures to safeguard the health and safety of the workforce.
It is important to stress that Bakkafrost has a very strong balance sheet and good access to capital. In December 2019 Bakkafrost refinanced the group’s bank facilities by ensuring 5-year bank facilities with banking group consisting of Nordea, DnB and Rabobank. The new bank facilities amount to 352 mEUR plus 100 mGBP and Bakkafrost has an additional accordion option for 150 mEUR. By the end of Q4 2019 Bakkafrost’s net interest-bearing debt was 1,019 mDKK and the undrawn credit facilities were 2,470 mDKK (not utilizing the accordion option). The equity ratio was 65% by the end of Q4 2019.
Today’s resolution to postpone the proposition on dividend payment for 2019 does not alter Bakkafrost’s dividend policy which is that 30-50% of earnings per share shall be paid out as dividends.
The AGM will be held on 3 April 2020 as previously announced.