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UPDATE 1-Fish farmer Grieg Seafood sees strong market; investments to jump
February 16, 2017 / 5:23 AM / 10 months ago

UPDATE 1-Fish farmer Grieg Seafood sees strong market; investments to jump

(Adds investment level, more on outlook)

Feb 16 (Reuters) - Grieg Seafood Asa

* Grieg seafood q4 ebit before adjustment nok 456 million (Reuters poll nok 450 million)

* Grieg seafood plans dividend of nok 3 per share

* Says strong market expected ahead

* Says 2017 investments to rise to NOK 600 million from less than NOK 300 million in 2016

* To invest NOK 100 million in Rogaland smolt plant expansion, NOK 100 million in Finnmark smolt plan expansion, NOK 200 million in new sites and NOK 200 million in maintenance

* Grieg seafood q4 revenue nok 2,069 million (Reuters poll nok 2.0 billion)

* Overall EBIT per kilo was NOK 21.80 in Q4

* Norway EBIT per kilo was NOK 27.9 in Q4, Shetland had NOK 8.8 per kilo, BC had NOK 7 per kilo

* Grieg seafood 2017 harvest guidance 70,000 tonnes versus 70,000 tonnes seen in January (Reuters poll 69,600 tonnes)

* Harvest forecast for 2017 was cut in January by 3,000 tonnes due to an outbreak of ISA in Finnmark

* Harvest volume in q1 2017 is likely to be 8,400 tons, down from Q4 harvest of 20,917 tons

* A stated goal is to reduce cost level to industry average, or lower. Company will also be aiming to increase production by 10% annually in period 2018-2020

* In a global perspective, there are expectations of limited supply-side growth in salmon market. There is strong underlying demand for salmon and good prices are therefore expected in 2017

* All employees will receive an extra bonus on top of existing bonus agreements. This cost is included in q4 figures

* Salmon sold on fixed price contracts stood at 32% in q4 2016, and this was a factor which reduced level of realised prices. This proportion is expected to be around 60% in q1 2017

* Increase in proportion of fixed price contracts must be considered in light of a low harvest volume in q1

* Global fish farming industry supply of salmon seen rising by about 2 pct in 2017 from 2016 after falling by around 6 pct year/year in 2015 Source text for Eikon: Further company coverage: (Reporting By Terje Solsvik)

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