Operational EBIT of DKK 376 Million for the Fourth Quarter of 2022

Operational EBIT of DKK 376 Million for the Fourth Quarter of 2022



Q4 Financial Report:

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

The Bakkafrost Group delivered a total operating EBIT of DKK 376 million (DKK 120 million) in Q4 2022 and made a profit of DKK -154 million (DKK -3 million). The combined FO farming and VAP segments made an operational EBIT of DKK 467 million (DKK 310 million). The FO farming segment made an operational EBIT of DKK 380 million (DKK 282 million). The SCT farming segment made an operational EBIT of DKK -149 million (DKK -214 million). The VAP segment made an operational EBIT of DKK 86 million (DKK 28 million). The EBITDA for the FOF segment was DKK 110 million (DKK 89 million).

Commenting on the result, CEO Regin Jacobsen said:

“Overall, we are satisfied with the results from the Faroe Islands in this quarter. The salmon market has been strong due to low global supply and the biological performance in the Faroe Islands has been strong with all-time low sea lice levels and historically low mortality. Our smolt production in the Faroe Islands receives new production capacity from the hatchery expansions at Norðtoftir and Glyvradal.

Around new year, we received our new wellboat, Bakkafossur, in the Faroe Islands. With a total capacity of 10,000m3, this is one of the biggest wellboats in the world, and also one of the most technologically advanced. It brings new freshwater treatment capabilities to the Faroese farming operation, which will be positive to further improve the biological performance, and it also prepares Bakkafrost for future offshore farming in the Faroe Island.

The biological performance in Scotland is still more challenging than in the Faroe Islands, but we are now much better equipped to tackle the challenges and mitigate biological risks in Scotland, e.g. with the new 4,000m3 wellboat in Scotland with dual treatment and freshwater capabilities. In second half of Q4 2022, the mortality in Scotland reduced significantly and we decided to reduce harvest to let the fish grow and gain weight and value. As a result, we have harvested bigger fish than ever before in January 2023.

We have made good progress with the implementation of our One Company strategy, with which we merge the Faroese and Scottish organisations, building upon the strengths of both. Sharing knowledge and best practice is key to us, especially within the farming operation and large smolt production. The latter is very important as we prepare for the release the first batch of large smolt from our expanded Applecross hatchery in Q2 2023.

The turbulence and uncertainty in the world economy is concerning. It is difficult to predict, how the inflation will impact the demand for salmon. Input costs have increased for the salmon industry, as well as for the other main animal protein sources, such as chicken, pork and beef, we compete with. It is therefore important to maintain a strong focus on costs and competitiveness in the global market. Despite high inflation on food the demand for salmon is still strong which is reflected in contract prices for this year. Looking ahead into 2023, the supply growth in the salmon market will be tight.”


Total harvested volumes for Q4 2022 were 24,500 tonnes gutted weight (25,800 tgw):

  • FO: 19,300 tgw (20,700 tgw),
  • SCT: 5,200 tgw (5,100 tgw).

Total harvested volumes in 2022 were 90,600 tonnes gutted weight (96,900 tgw):

  • FO: 66,700 tgw (67,200 tgw),
  • SCT: 23,900 tgw (29,700 tgw).


In total, 8.5 million (9.2 million) smolts were transferred during Q4 2022:

  • FO: 5.0 million (5.1 million),
  • SCT: 3.5 million (4.2 million).


In 2022, 25.4 million (25.5 million) smolts were transferred: 

  • FO: 14.4 million (14.4 million),
  • SCT: 11.0 million (11.1 million).


The combined FO farming and VAP segments made an operational EBIT of DKK 467 million (DKK 310 million) in Q4 2022. The operational EBIT per kg in Q4 2022 was DKK 24.21 (DKK 15.00), corresponding to NOK 33.81 (NOK 20.11). The FO Farming segment achieved higher prices in Q4 2022 than in Q4 2021. For 2022, the combined FO farming and VAP segments made an operational EBIT of DKK 1,862 million (DKK 1,023 million).


The SCT farming segment made an operational EBIT of DKK -149 million (DKK -214 million). In Q4 2022, the SCT farming segment had incident-based costs of DKK 81 million (DKK 179 million). For 2022, the operational EBIT was DKK -298 million (DKK -249 million).


The FOF segment made a 14.0% (20.6%) EBITDA margin. Fish feed sales amounted to 32,600 tonnes (32,500 tonnes) in Q4 2022. During Q4 2022, Havsbrún sourced 46,100 tonnes (27,300 tonnes) of raw material. For 2022, the EBITDA was 17.9% (18.5%). In 2022, Havsbrún sourced 297,800 tonnes (152,400 tonnes) of raw material.

The net interest-bearing debt amounted to DKK 2,664 million at the end of Q4 2022, compared to DKK 2,126 million at year-end 2021. Undrawn credit facilities amounted to DKK 2,542 million at the end of Q4 2022.

The long-term goal of the Board of Directors is that 30-50% of earnings per share shall be paid out as dividend. Bakkafrost’s financial position is strong with a solid balance sheet, a competitive operation and available credit facilities. The Board of Directors proposes to the Annual General Meeting that DKK 10.00 (NOK 14.53*) per share shall be paid out as dividend. The Annual General Meeting will be convened on Friday the 28th of April 2023.


The equity ratio was 62% on 31 December 2022, compared to 64% at the end of 2021.


* The dividend per share in NOK is subject to changes depending on the exchange rate between NOK and DKK, which will be announced after the Annual General Meeting.



Supply decreased in Q4 2022

The supply of salmon decreased by 0.3% in Q4 2022 compared to Q4 2021, incl. inventory movements. Without inventory movements, the supply decrease was 2.2%, according to the latest estimate from Kontali Analyse.

22% higher salmon prices

Salmon spot prices were 22% higher this quarter compared to Q4 2021. Strong demand for salmon, low supply increase and general inflation have contributed to high salmon prices this quarter.

Low growth in 2023

In H1 2023, the global supply is expected to be on the same level as in H1 2022. In H2 2023, the global supply is expected to grow around 4-5%. For the full year 2023, the global supply growth is expected to be around 2%, excluding inventory movements.

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, Europe, 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 this quarter. Sea lice levels have been maintained at all-time low this quarter, and the low mortality rates have continued this quarter.

Bakkafrost’s new 10,000m3 Live Fish Carrier, Bakkafossur, arrived in the Faroe Islands at the beginning of January 2023 and will play an important role in strengthening Bakkafrost’s capabilities to maintain low biological risk in the Faroe Islands. Also, the vessel is designed to support future off-shore farming in the Faroe Islands.

The Norðtoftir hatchery is now in operation and has successfully released the first batch of large smolt since the expansion. The hatchery expansion at Glyvradal is about to be finished and will start operation in Q1 2023. Combined, these capacity expansions will increase the smolt production capacity in the Faroe Islands with around 6.5 million smolts of 500g. These 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 Q4 2022 have followed the normal seasonal pattern with more biological challenges compared to the first half of the year in particular. However, the biological situation improved considerably in the second half of Q4, and Bakkafrost decided to slow down harvest to let the fish continue growing and gain weight. This reduced the harvest volume in Q4 2022 but will increase value with harvesting larger fish in Q1 2023. Overall, the mortality in Q4 2022 was lower than the year before, and from the beginning of December 2022, mortality levels have been at the same level as normally found in the first half of the year.

One contributing factor to the improved biological development in late Q4 in Scotland was the arrival of the new 4,000m3 Live Fish Carrier in late September 2022. Equipped with freshwater treatment capacity as well as an innovative in-line freshwater-based sea lice removal system this vessel can efficiently do dual treatments for gill-related issues as well as sea lice removal in one operation. The operation has proven to be efficient and Bakkafrost has decided to implement the same systems on the second Live Fish Carrier in Scotland as well as on the new Live Fish Carrier in the Faroe Islands, Bakkafossur.

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 fundamental to the turnaround of the farming operation. 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 the Applecross 4 expansion is expected to be operational with fish in the tanks in March 2023. 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-quality smolts of around 500g.

In Q4 2022, the average weight of released smolt in Scotland was 115g, which is 10% higher than in Q4 2021.

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

Smolt release

Bakkafrost expects to release around 16 million large smolts in 2023 in the Faroe Islands and around 9.6 million smolts 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 in 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 were 66.7 thousand tonnes gutted weight and 23.9 thousand tonnes gutted weight in Scotland, giving a total of 90.6 thousand tonnes gutted weight.

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 6 to 12 months.

For 2023, Bakkafrost has signed contracts covering around 23% of the expected harvest volumes in the Faroe Islands and Scotland combined.

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 was 128,000 tonnes, and is expected to increase up to around 130,000 tonnes in 2023.

The major market for Havsbrún’s fish feed are the internal Faroese and Scottish Farming segments.

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 a 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 a 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.

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 plus an extension of one year. 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 Q4 2022 report and the Q4 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), Boulogne-Sur-Mer (France), New Jersey (US) and Munkebo (DK). The Bakkafrost Group has 1,778 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