Iceland Seafood International hf

Volatility and unstable environment continued to affect Iceland Seafood's results in Q2 2023 - Seite 2

Sales of the VA S-Europe division were €113.5m in 1H 23, increased by 4% from last year, but the division saw a sales decline of 13% in Q2. The winter season for Argentinean shrimp started at end of June, which was four weeks later than last year, which impacted both sales and profitability in the period. Price decreases have also impacted the margins of IS Ibérica, especially in relation to some shellfish species that have been kept in stock. Although these price decreases have negative impact in the short term, it will help with balancing demand in the longer term. Sales of Ahumados Dominguez were up 13% from 1H 22, driven by price increases. High salmon prices impacted the results of AD in the period, but with prices levelling off in Q3, results have improved, and the outlook is good for the remainder of the year. Normalised PBT for the division was negative by €0.1m in the 1H, down €4.3m from 1H 2022.

As informed previously the VA N-Europe division now consists solely of Oceanpath’s Group operation in Ireland, as Iceland Seafood UK (IS UK) is classified as asset held for sale. Sales in Ireland were €26.4m in 1H 2022, grew slightly from same time 2022. As at Ahumados Dominguez, high salmon prices negatively impacted sales and results in the period. However, the difficult economic situation and diminishing consumer purchasing power seem to have less impact on salmon sales than sales of various other seafood categories. Normalised PBT was at break-even in Ireland for 1H of the year, which was €1.5m improvement from 1H 22. Outlook for the remainder of the year is good, with salmon prices levelling off and Christmas production starting.

The S&D division had an excellent start of the year, helped by strong sales of pelagic out of Iceland and good capelin season. Sales of land-frozen and sea-frozen products also increased from 1H 2022. Although sales slowed down in Q2, they were fully acceptable considering the challenging market situation. Normalised PBT of the year of €1.4m were €0.3m down on 1H 2022, but still the second strongest 1H the division has delivered.

As announced today, Iceland Seafood has agreed sell 100% of the share capital of IS UK to Espersen A/S. As set out in the announcement, impairment of fixed assets of €8.3m is included in the 1H group results; the majority of the negative impact from the divestment is therefore included in the 1H results. The total impact of discontinued operations in the period were €13.9m. Net loss of the Group in 1H 2023 of €15.3m were €12.4m down on 1H 2022.