Operational EBIT of DKK 325 Million for the Third Quarter of 2022

Operational EBIT of DKK 325 Million for the Third Quarter of 2022




(Figures in parenthesis refer to the same period last year unless otherwise specified)

The Bakkafrost Group delivered a total operating EBIT of DKK 325 million (DKK 71 million) in Q3 2022 and made a profit of DKK 249 million (DKK 131 million). The combined FO farming and VAP segments made an operational EBIT of DKK 444 million (DKK 146 million). The FO farming segment made an operational EBIT of DKK 444 million (DKK 135 million). The SCT farming segment made an operational EBIT of DKK -137 million (DKK -81 million). The VAP segment made an operational EBIT of DKK 0 million (DKK 11 million). The EBITDA for the FOF segment was DKK 120 million (DKK 111 million).

Commenting on the result, CEO Regin Jacobsen said:

“Overall, we are satisfied with the results from the Faroe Islands in this quarter, however not with the results from the Scottish farming segment.

We are pleased to see continuing strong biological performance in the Faroe Islands with strong growth, all-time low sea lice levels and increased average harvest weights. We are also pleased with the positive results from the implemented changes in the large-smolt production regime in the Faroe Islands. This has resulted in more robust smolt with better biological performance. Declining mortality levels in the farming operation from the smolt produced after the changes were implemented demonstrate the impact of these changes for our farming operation in general and large-smolt production in the Faroe Islands and Scotland.

We are not satisfied with the biological performance in the Scottish farming segment, where mortality rates have been higher than expected in this quarter. This reminds us, that we still face challenges while we await larger and better quality smolt. In Q2 2023, we will reach an important milestone in Scotland as we expect to release the first batch of large smolt from our Applecross hatchery. In the meanwhile, good biological risk mitigation is important and freshwater treatment capacity plays an important role here. Unfortunately, our new wellboat for Scotland was delayed, but was finally in operation in late September. Hereby we have significantly upscaled our freshwater treatment capacity which is now finally at a sufficient level. The new 4,000m3 well-boat can treat for gill health issues as well as remove sea lice in one gentle treatment and the results so far are promising.    

Regarding the market, Q3 has been a quarter with large variations. The tight supply and high prices in the beginning of the quarter was replaced by significantly higher volumes supplied to the market in the second half of the quarter and at lower prices, however still well above previous years. Despite high inflation on food the demand for salmon is still strong which is reflected in contract prices for next year. Looking ahead into 2023, the supply growth in the salmon market will be tight with low single-digit growth.”


Total harvested volumes for Q3 2022 were 25,000 tonnes gutted weight (21,900 tgw):

  • FO: 16,900 tgw (14,900 tgw),
  • SCT: 8,100 tgw (6,900 tgw).


Total harvested volumes for the first nine months of 2022 were 66,100 tonnes gutted weight (71,100 tgw):

  • FO: 47,400 tgw (46,500 tgw),
  • SCT: 18,700 tgw (24,600 tgw).


In total, 6.6 million (7.0 million) smolts were trans­ferred during Q3 2022:

  • FO: 4.1 million (3.8 million),
  • SCT: 2.4 million (3.3 million).


In total, 17.0 million (16.3 million) smolts were trans­ferred during the first nine months of 2022:

  • FO: 9.4 million (9.4 million),
  • SCT: 7.5 million (6.9 million).


The combined FO farming and VAP segments made an operational EBIT of DKK 444 million (DKK 146 million) in Q3 2022. The operational EBIT per kg in Q3 2022 was DKK 26.36 (DKK 9.79), corresponding to NOK 35.62 (NOK 13.59). The FO Farming segment achieved higher prices in Q3 2022 than in Q3 2021. For the first nine months of 2022, the combined FO farming and VAP segments made an operational EBIT of DKK 1,395 million (DKK 713 million).

The SCT farming segment made an operational EBIT of DKK -137 million (DKK -81 million). In Q3 2022, the SCT farming segment had incident-based costs of DKK 121 million (DKK 69 million). For the first nine months of 2022, the operational EBIT was DKK -149 million (DKK -36 million).

The FOF segment made an 18% (20%) EBITDA margin. Fish feed sales amounted to 37,800 tonnes (45,000 tonnes) in Q3 2022. During Q3 2022, Havsbrún sourced 76,200 tonnes (17,200 tonnes) of raw material. For the first nine months of 2022, the EBITDA was 20% (18%). During the first nine months of 2022, Havsbrún sourced 251,800 tonnes (125,100 tonnes) of raw material.

The net interest-bearing debt amounted to DKK 2,427 million at the end of Q3 2022, compared to DKK 2,126 million at year-end 2021. Undrawn credit facilities amounted to DKK 2,762 million at the end of Q3 2022.

The equity ratio was 64% on 30 Sep 2022, com­pared to 64% at the end of 2021.



Supply increase of 4%

The supply of salmon increased 4.1% in Q3 2022, compared to Q3 2021 incl. inventory movements. Without inventory movements, the supply increase was 6.6%, according to the latest estimate from Kontali Analyse.

27% higher salmon prices

Salmon spot prices were 27% higher in this quarter compared to Q3 2021. Strong demand for salmon, moderate supply increase and general inflation have contributed to high salmon prices in this quarter.

No growth in 2022

In Q4 2022, the global supply growth is expected to be around 1%. For the full year of 2022, the supply is expected to be on the same level as in 2021, including inventory movements. In H1 2023, zero growth is expected.

Bakkafrost has a strong focus on ensuring a well-balanced flow to the different markets to increase diversification and mitigate market risk. Bakkafrost operates in the main salmon markets, Eu¬rope, the USA, and the Far East. Since the beginning of the war in Ukraine, Bakkafrost has stopped all trading with Russia.


The strong biological performance in the Faroese farming operation seen in previous quarters has continued also in this quarter. Sea lice levels have been maintained at all-time low levels for this quarter and the low mortality rates have also continued in this quarter.

The delivery of Bakkafrost’s new Life Fish Carrier, Bakkafossur, has been delayed until Q4 2022. With its 7,000m3 tank capacity for seawater, 3,000m3 for freshwater and a reverse osmosis system onboard for freshwater generation, Bakkafossur will strengthen Bakkafrost’s capabilities to maintain low biological risk in the Faroe Islands.

The expansions of the hatcheries at Norðtoftir and Glyvradal are progressing well and will start operations in Q4 2022 and Q1 2023 respectively. Combined, these capacity expansions will increase the smolt production capacity in the Faroe Islands with around 6.5 million smolts of 500g and are important milestones to fulfil Bakkafrost’s goal to build an annual smolt production capacity in the Faroe Islands of over 23 million smolts of 500g in 2026.

In Scotland, farming conditions in Q3 2022 have followed the normal seasonal pattern with significant biological challenges and higher mortality. Especially the Loch Fyne and East Lewis & Harris areas have been affected and suffered increased mortality. The negative development in the quarter was a continuation of the increased mortality in late Q2 2022, which in particular affected farming sites with fish previously compromised in H2 2021. The mortality levels in Q3 2022 have been higher than expected and caused by different reasons, such as gill-related issues.

In late September 2022, the new 4,000m3 Life Fish Carrier with freshwater treatment capacity, as well as an innovative in-line freshwater-based sea lice removal system was introduced in the farming operation in Scotland. This vessel can efficiently do dual treatments for gill-related issues as well as sea lice removal in one operation, thereby improving fish welfare while applying minimum stress on the fish. The results have been successful and together with the second Life Fish Carrier in operation, Bakkafrost has secured proficient treatment vessel capacity in Scotland.

The biological risk in Scotland is still higher than in the Faroe Islands but is expected to be transformed with the implementation of Bakkafrost’s large-smolt strategy. As demonstrated in the Faroe Islands, large high-quality and robust smolt will have a lower risk exposure in the marine environment due to shorter production cycles in the sea. This is expected to significantly reduce the biological risk in Scotland and is the cornerstone of the turnaround of the farming operation in Scotland. Therefore, it is Bakkafrost’s topmost priority in Scotland to build new modern hatcheries. The ongoing expansion of the Applecross hatchery is progressing well and will reach an important milestone by the end of this year when the Applecross 4 expansion is expected to be completed. The first batch of large smolt delivered from Applecross 4 is planned for Q2 2023 and will contribute to increasing the mean weights and quality of the smolt stocked in Scotland in 2023.

The full capacity of the Applecross hatchery, including the next expansions, will be in operation in mid-2024 bringing the overall annual production capacity from Applecross to around 10 million high-qualitysmolts of around 500g.

In Q3 2022, the average weight of released smolt in Scotland was 107g, which is 9% higher than in Q3 2021.

Bakkafrost plans to build 3 large hatcheries in Scotland, which will increase the total annual production capacity up to around 18 million smolts of around 500g in 2026.

Smolt release

Bakkafrost expects to release around 14.5 million large smolts in 2022 in the Faroe Islands and around 10.8 million smolts of around 110g in Scotland. The number and the average weight of smolts released are key elements of predicting Bakkafrost’s future production.

Million smolt released





















The average weight of the smolt released in Scotland in 2023 is expected to increase to around 150-175g. In 2023, the number of released smolt will be lower than previous years as the focus is on stabilising the operation before increasing the volume. In this respect, smolt quality is more important than the released volume.

Harvest volumes for 2022 in the Faroe Islands are expected around 68,000 tonnes gutted weight and 25,000 tonnes gutted weight in Scotland, giving a total of 93,000 tonnes gutted weight. The expected harvest in Scotland is due to higher mortalities in Q2 and Q3 2022.

In 2023, Bakkafrost expects to harvest around 68,000 tonnes gutted weight in the Faroe Islands and 30,000 tonnes gutted weight in Scotland, giving a total of around 98,000 tonnes gutted weight.

The estimates for harvest volumes and smolt releases in both geographies are dependent on biological development.

VAP (Value Added Products)

Bakkafrost’s highly flexible value chain includes a state-of-the-art VAP factory with high capacity. This enables Bakkafrost to adapt well to the rapidly changing mar­ket situations.

Bakkafrost’s long-term strategy is to sell around 40% of the harvested volumes of salmon as VAP products on contracts. The contracts are at fixed prices with a duration of between 6 to 12 months.

For 2022 Bakkafrost has signed contracts covering around 33% of the expected harvest volumes in the Faroe Islands and Scotland combined. Contracts for 2023 are mainly negotiated in November and December, and so far 22% of the harvest 2023 volume has been contracted.


FOF (Fishmeal, Oil and Feed)

The outlook of fishmeal and fish oil production is dependent on the availability of raw materials.

The ICES 2023 recommendation for blue whit­ing is 1,360 thousand tonnes, which is an 81% increase from the recommendation for 2022.

In 2023 Bakkafrost expects similar production volumes of fishmeal and fish oil as in 2022.

Havsbrún’s sales of fish feed in 2022 is expected to be around 125,000 tonnes and to increase up to around 130,000 tonnes in 2023.

The major market for Havsbrún’s fish feed is the local Faroese market, primarily Bakkafrost FO’s internal use of fish feed, and the feed used in the Scottish farming operation.

Lately, the prices on vegetable raw materials have increased significantly. This affects the whole animal protein market as well as other food producers. Bakkafrost is in a relatively good competitive position due to the low inclusion of vegetable ingredients in the feed combined with low feed conversion ratio and good access to marine raw materials.



On the Capital Markets Day on 14-15 September 2021, Bakkafrost announced a 6.2bn DKK investment plan for 2022-2026. The investments will enable transformation of the operation in Scotland and provide sustainable growth in the Faroe Islands as well as Scotland.

The main purpose of the investments in Scotland is to replicate Bakkafrost’s successful operation in the Faroe Islands. Bakkafrost will build 3 large energy-efficient hatcheries in Scotland, enabling the implementation of Bakkafrost’s large smolt strategy and giving an annual production capacity above 18 million smolts at 500g. Having large smolt in Scotland will transform the performance, lower the biological risk and increase harvest volumes. In addition to building hatchery capacity, Bakkafrost plans to build a new processing plant to strengthen processing capabilities and increase flexibility in operation. Bakkafrost will also invest in more service vessel capacity to improve the mitigation of biological risk. Further, Bakkafrost will make investments in marine site development.

The investments in the Faroe Islands include increasing annual hatchery production capacity to around 23 million smolts at 500g, investments in a brood stock facility and expansion of feed production capacity.

With the investment plan, Bakkafrost expects to sustainably grow the total annual harvest volumes to 150,000 tonnes in 2026. Over the same period, the total annual production capacity in Bakkafrost’s value chain will reach 180,000 tonnes gutted weight.

Capital Market Day in Scotland in 2023

Bakkafrost’s next Capital Markets Day will be on 6-7 June 2023 and will be held in Scotland.


The long-term market balance in the global market for salmon products will most likely remain favourable for Bakkafrost. Bakkafrost has a long val­ue chain and a cost-efficient production of high-qual­ity salmon products and will likely maintain finan­cial flexibility going forward.

In March 2022, Bakkafrost finalized a new sustainability-linked 700 mEUR multicurrency revolving credit facility agreement with an additional accordion option of 150 mEUR. The facility has a tenor of five years. In combination with Bakkafrost’s high equity ratio, the facility gives the necessary financial strength and flexibility for the Group’s investment plans aimed at significant organic growth and structural cost reductions in Scotland. It will also enable M&A’s and further organic growth opportunities as well as support an un­changed dividend policy in the future.

Please find the Company’s Q3 2022 report and the Q3 2022 presentation enclosed.


Regin Jacobsen, CEO of P/F Bakkafrost: +298 235001 (mobile)

Høgni Dahl Jakobsen, CFO of P/F Bakkafrost: +298 235060 (mobile)

This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.

About Bakkafrost:

Bakkafrost is the largest salmon farmer in the Faroe Islands and the second largest salmon farmer in Scotland. The Group is fully integrated from feed production to smolt, farming, VAP and sales. The Group has production of fishmeal, fish oil and salmon feed in the Faroe Islands and primary and secondary processing in the Faroe Islands, Scotland and Denmark. The Group operates sea farming and  broodstock operations in both the Faroe Islands and Scotland. The Group has built a biogas plant in the Faroe Islands. The headquarter is located in the Faroe Islands, and the Group has sales and administration offices in Grimsby (UK), Edinburgh (Scotland),  New Jersey (US) and Munkebo (DK). The Bakkafrost Group has 1,644 employees (full-time equivalents).


This press release does not constitute or form part of an offer or solicitation to purchase or subscribe for securities. The securities referred to herein may not be offered or sold in the United States absent registration or an exemption from registration as provided in the U.S. Securities Act of 1933, as amended. Copies of this announcement are not being made and may not be distributed or sent into the United States, Australia, Canada or Japan.

Press Contacts:
Regin Jacobsen CEO
+298 23 50 01