Bakkafrost sees revenue and EBIT growth in Q1 2024 By Investing.com

Bakkafrost (FO-BAKKA), the Faroe Islands-based seafood company, reported a robust first quarter in 2024, with an 8% increase in revenues to DKK 2.2 billion and operational EBIT rising to DKK 710 million, up from DKK 565 million in the same period last year.

The company’s Faroe Islands operations experienced an increase in harvest volumes, contributing to the positive results, while Scotland faced challenges with lower harvest volumes and increased costs. Despite global harvests dropping by 5%, Bakkafrost managed to slightly increase net supply due to inventory movements. The firm also noted progress in its ESG efforts and provided updates on its operational strategies and market outlook.

Key Takeaways

• Bakkafrost’s revenues rose to DKK 2.2 billion, an 8% increase year-on-year.
• Group operational EBIT reached DKK 710 million, a significant improvement from the previous year’s DKK 565 million.
• Harvest volumes increased in the Faroe Islands but decreased in Scotland.
• Feed sales went up by 21%, while fish oil sales saw a reduction.
• The average price for superior salmon increased by 4% year-on-year.
• Sales to Europe grew by 4%, while sales to the US declined by 2%.
• Inventory movements resulted in a 0.6% net supply increase despite a 5% drop in global harvest.

Company Outlook

• Bakkafrost aims to sustain growth, focusing on increasing smolt production capacity.
• The company is addressing construction delays in Scotland and expects no impact on 2026 capacity from delays in the Faroes.
• Farming guidance remains unchanged, emphasizing sustainable growth.

Bearish Highlights

• Scotland’s performance was weak, with increased costs and a high mortality ratio.
• Lower harvested volumes and operational EBIT were reported in Scotland.
• The fishmeal and oil segment anticipates lower margins compared to 2023.

Bullish Highlights

• Strong performance in the Faroe Islands with higher average weights and increased operational EBIT per kilo.
• Positive cash flow from operations at DKK 676 million.
• Continued growth in sales to Greater China and Latin America.

Misses

• A negative fair value adjustment and tax were noted in the financials.
• Sales to the US market decreased by 2%.

Q&A Highlights

• Bakkafrost addressed the high costs in Scotland, attributing them to low production and compromised biology.
• Feed costs are expected to slightly decrease due to lower raw material costs.
• The company discussed its fishmeal and oil segment expectations, with strong demand but somewhat lower prices than the peak in Q4 2023.

In summary, Bakkafrost’s first quarter of 2024 has been marked by revenue growth and stronger operational EBIT, despite challenges in Scotland and a decrease in global harvest volumes. The company’s strategic focus on sustainability and capacity expansion, alongside its effective management of inventory and market dynamics, has positioned it for continued growth in the seafood industry.

Full transcript – Bakkafrost (BKFKF) Q1 2024:

Hogni Jakobsen: Good morning, and welcome to the presentation of Bakkafrost’s results for the first quarter of 2024. Today, we are webcasting here from our headquarters in the Faroes. My name is Hogni Jakobsen, and I’m joined by our CEO, Regin Jacobsen. And together, we will go through this agenda this morning, first off, the first quarter, and then we look at market and sales, financials and ESG and then an update on operations and the outlook for the time to come before we open up for Q&A. First off, so our revenues in this quarter increased to DKK 2.2 billion, around 8% up from last year. Group operational EBIT in this quarter was DKK 710 million, which is up DKK 565 million in the same quarter last year. In the Faroes, we increased our harvest volumes with 3,300 tonne to around 14,300 tonne. In Scotland, we had lower harvest in this quarter, 800 tonne lower and harvested around 7,300 tonne. Feed sales increased by 21% to 27,000 tonne. Our fish oil and — fish oil sales reduced by 1,500 tonne to around 4,000 tonnes in this quarter. Marine raw material sourcing also was lower than the same quarter last year, 137,000 tonnes in this quarter compared to 156,000 tonnes last quarter — last year. However, we have to remember that last year was an exceptionally high — we had exceptionally high volumes of marine raw material for our fishmeal oil and feed production. Cash flow from operations was positive in this quarter with DKK 676 million. And all segments had positive EBIT except for the Scottish freshwater segment and sales and other segments. On the AGM, that was last week, the proposed dividend of DKK 8.70 was approved and that will be paid out around the 21st of May. Moving on to market and sales. The average price for 4 to 5-kilo superior salmon in the quarter was NOK 108.97 per kilo, which is an increase of 4% compared to the same quarter last year. Quarter-on-quarter, it was an increase of 31%. In euros, year-on-year prices were almost unchanged, slight increase of 0.5%. NOK prices increased through the quarter followed the same path as last year. The market was, in general, affected by a shortage of large superior fish. Hence, we also saw the price difference between small fish and large fees increasing through the quarter. According to the latest update from Kontali on sold quantities to the market, sales to the European market increased by 4% in this quarter in despite of lower European harvest. Demand in Europe has been good. And the biological challenges in Norway has increased the availability of fillets to the European market. Global sales to the U.S. reduced with 2%, showed signs of increased price sensitivity and also there were good availability of substitutes. Sales to Greater China continued the upward trends that we have seen for many quarters. However, at a slower pace of 3%. Latin America had also similar development as China in this quarter, showing a growth of 3%. Sales in Japan and the ASEAN market were affected negatively by continued high airfreight costs and also increased consumer price sensitivity. Global harvest in this quarter dropped by 5%, but this was more than offset by considerable inventory movements in the quarter, resulting in a small net supply increase of 0.6% European harvest dropped 3%, and there was a 10% drop in harvest from the Americas. Norwegian harvest was impacted by the biological challenges, such as (spring) jellyfish and wounds, increased mortality and also we saw an increased share of downgrades in Norway. Chilean harvest was affected by some issues with algae, but also a lower incoming biomass in the beginning of the year due to low smolt release in the previous years. The only region that showed increased harvest weights in the quarter was the Faroes, where harvest weights for the industry increased 12% to 5.27 kilo. Feed sales reduced 9% in Norway and 10% in Chile. And in the Faroes, we had increased feed sales of 13% and 5% to 6% increase in feed sales in Scotland. Canada and Iceland also had increased feed sales in this quarter. If we move on to financials. As mentioned in the summary, revenues in the quarter increased from around DKK 2 billion to DKK 2.2 billion. Revenue — operational EBIT was DKK 710 million. Fair value adjustments were negative in this quarter with DKK 70 million, and revenue tax amounted to minus DKK 112 million compared to minus DKK 38 million in the same quarter last year. Profit after tax was DKK 401 million compared to DKK 467 million last year. Measured in operational EBIT this quarter is the best quarter ever for Bakkafrost. And adjusted earnings per share was DKK 7.66. On the balance sheet, we see that our property, plant and equipment amounted to DKK 6.3 billion at the end of this quarter and biological assets to DKK 3.3 billion. Inventories reduced slightly during the quarter to DKK 1.115 billion, whereas receivables increased by DKK 231 million and amounted to DKK 1.2 billion. Cash and cash equivalents also increased to DKK 572 million from DKK 412 million at the end of previous quarter, and equity ratio increased to 62%. Moving on to cash flow. From operations, as mentioned earlier, positive with DKK 676 million. Cash flow from investments was minus DKK 238 million and from financing minus DKK 278 million. In this quarter, we decreased our net interest-bearing debt with DKK 353 million, and at the end of the quarter, we — our net interest-bearing debt was DKK 3.18 billion. We had undrawn credit facilities of DKK 2.2 billion at the end of the quarter. And then a short ESG update. In March, we published our first integrated annual report where we have merged together our annual report with our sustainability report. And this is an important step for us to align with the CSRE reporting requirements, which will become mandatory from next year and onwards, is a very extensive report. So we have also published a shorter report, a summary report, if you just want to have a short overview of the year in the past. As always, the repos are available on our website. There’s a lot of information that can be read in our integrated report. One important information is how we progress on our targets to reduce our greenhouse gas emissions. We have set ambitious reduction targets for Scope 1, 2 and 3, which we had SBTI approved last year. And if we look at the greenhouse gas emissions per net revenue, we are trending downwards. However, last year, we had a slight tick upwards, which is due to the massively increase in production of fishmeal and oil that we had last year by an equal proportion of increased revenue. All in all, our Scope 1 and 2 emissions last year was 36% higher than our 2020 baseline, measured in absolute numbers. However, if we take into account the increased wallet production volume, the intensity is more or less unchanged. In our Q4 presentation, we disclosed our plans to reduce Scope 1 and 2, primarily by electrifying our fishmeal oil and feed production of Havsbrun, which accounts for the majority of our Scope 1 and 2, and more details will be shared on this in coming quarters. It’s much more challenging to reduce our Scope 3 emission. This accounts for 73% of our total emission. And therefore, it’s also a much more important challenge to succeed on. Our target is a reduction of 52% on intensity, and we are very pleased to see that already by now. We have managed to reduce by 20% on our Scope 3 emission intensity. And with those words, I will leave it over to Regin to go through the operations and outlook.

Regin Jacobsen: Thank you. Good morning. If you look at the performance per region for the first quarter 2024, we see a strong performance for the group with our combined operational EBIT of DKK 32.92 for the first quarter ’24 versus DKK 29.16 same quarter last year. The operational EBIT for Scotland was DKK 5.39 per kilo versus DKK 19.14 in the same quarter last year. Faroe Islands had an operational EBIT per kilo of DKK 46.91 versus DKK 37.29 in the same quarter last year. Overall, we can say that Faroes Islands delivered a strong result and Scotland, a weak result in this quarter. The FOF segment had a good quarter. The marine raw materials sort was 12% down to 137,000 tonne versus 156,000 tonne in the first quarter last year. Feed sales increased 21% to 27,000 tonne from ’22. External sales of fishmeal decreased 5% and external sales of fish oil decreased 28%. The operational EBIT increased 45% to DKK 177 million from DKK 122 million. The EBIT margin increased 7% to 24% from 17%. Global markets for fishmeal and oil have been all-time high and have declined slightly in the first quarter ’24 versus the fourth quarter last year. The fresh water segment in the Faroes Islands transferred small to marine farms in the third quarter, flat number from last year, DKK 2.1 million. The average weight dropped to 410-gram from 424 gram last year. The operational EBIT dropped 6% to NOK 38.36 per kilo in the first quarter versus NOK 40.75 in the first quarter last year. The operational margin dropped 4% to 24% in the first quarter ’24 from 26% last year. The total capacity of our freshwater segment in Faroes has increased 50% last year, up to 9,000 tonne from 6,000 tonne last year. The production is now being ramped up to deliver robust and larger smolts going forward. This will especially be seen next year, but also a slight ramp-up this year. During this ramp-up operation, there’s a high focus on consistent high-quality and robustness of the smolts. Construction of the new hatchery in Skalavik started in the first quarter. This hatchery will add another 40% capacity on the existing capacity, bringing our capacity in the Faroes up to 12,000 tonne by ’27. In Scotland, we transferred 1.6 million smolts in our fresh water segment versus 1.7 million last year. The average weight was 121 grams versus 111 grams last year. There has unfortunately been some more issues in the first quarter ’24 at Applecross, which has delight — delayed delivery of the larger-sized fish around 6 months. These issues are related to construction issues, which has delayed the use of AP4 more than expected. This means that only from the third quarter ’24, we will see the largest smolts 200-gram plus being transferred from Applecross. Therefore, we have updated the expectations of size on transferred fish down to 111 grams in the second quarter, 168 grams in the third quarter and 200 grams in the fourth quarter this year. The start of AP5 is, however, still expected in the fourth quarter, which will increase the capacity significantly. The development is negatively impacting the financial result and cautious loss related to culling of fish, which impacted the financial result negatively by DKK 14 million in the first quarter 24. Farming in the Faroe Islands, the total harvested volume in the third quarter ’24 is 14,294 tonne versus 11,005 tonne in the same quarter last year. The average weight of harvested fish in the first quarter was 30% up to 5.4 kilos gutted versus 4.4 kilos in the first quarter ’23. This size of harvested fish in the first quarter is all-time high for our first quarter and is really positive and a very important driver to create higher values. The operational EBIT per kilo in the first quarter ’24 increased 65% to NOK 50.56 from NOK 30.56 in the first quarter last year. The operational EBIT margin increased 12% to 40% in the first quarter ’24 from 28% last year. Sales revenue in the first quarter increased 10%. The increase is NOK 11 per kilo for the Faroese farming segment. Cost of farming operation in the first quarter was flattish, around 1% up. Corresponding to NOK 63. The temperature in Faroese farming forge were unchanged in ’24 versus the last 20 years. The breakdown of the Faroese harvested volume in the first quarter was 52% from rest of the total volume, average weight of 5.8 kilo gutted weight. From the North, 32% of the total volume, average weight of 5.3 kilo gutted weight. And from the South, 15% of the total volume, average weight of 4.8 kilo. There was a strong development in KPIs in the first quarter of harvested fish referring to growth weight, feed conversion ratio and KPI in general. Moving to Scotland. The total harvested volume was 10% down to 7,263 tonne versus 8,093 tonne last year. The average weight in the first quarter ’24 was 13% down to 4.7 kilo gutted versus 5.3 kilo gutted last year, which was exceptionally high. The lowest sized fish was from one of our sites in the North division, with average weight of 3.8 kilos. As this volume was 30% of the total harvest in the first quarter for Scotland, it impacted the total average weight and the operations significantly. The operational EBIT was 77% down to NOK 5.13 per kilo versus NOK 22.33 last year. The drop was NOK 17.20 per kilo. The operational margin dropped 14% to 5% in the first quarter ’24 versus 19% last year. If you look at the breakdown behind the numbers, we see that the sales revenue per kilo in Scotland dropped 4%, which corresponds to NOK 4.81 per kilo. If you look at the cost of our farming operations in Scotland, we see an increase of the cost of the farmed salmon and of the harvested fish in the first quarter. And this increase was 5%, corresponding to NOK 4.17 per kilo hog in the first quarter ’24. Comparing first quarter ’24 to first quarter ’23, the margin is NOK 16 negatively impacted whereof NOK 5 reduced value per kilo caused by smaller sizes and reduced achieved average selling price. NOK 4 is because of increased farming cost. And NOK 4 is because of exceptional mortality, which was DKK 18 million, primarily attributed from jellyfish-related incident on the one farming location North, which resulted in compromised fish health and elevated mortality rates. NOK 3 per kilo relates to additional provision of DKK 13 million, which have been accounted for in the quarter for other expenses. Our derisking plans in Scotland will end the second quarter — second — so coming quarter focus to reduce the risk into the third quarter. In April, average weight in Scotland of harvested fish was 4.5 kilo hog versus 4.8 kilo in April ’23. In April, we harvested 3,909 tonne, whereof 264 tonne were harvested from one farm in the North with average weight of 2.1, the rest of harvested fish was in good market size. In May and June, average weight will come lower, probably somewhere between 3 and 4 kilos as precaution measures will lead to harvesting of smaller batches to reduce risk in the third quarter. This approach will reduce the biomass at risk in the third quarter and result in increased harvest volume during the first half of the year. Moving to the Service segment. The operational EBIT amounted to NOK 1.87 per kilo in the first quarter, up from NOK 0.66 per quarter per kilo in the first quarter last year. The operational margin was 10% in the first quarter versus 4% last year. Low sea lice numbers across both Faroes and Scottish farming sites are the result of a good operation. Bakkafrost has good capacity with gentle high effective treatment capabilities. Moving to sales and other, which includes the VAP segment, where we reduced our volumes in this quarter by 35% versus last year to 3,296 tonnes versus 5,098 tonne last year. The segment also includes all sales, marketing logistics of salmon in general. Margin for sales and other dropped in the first quarter to minus NOK 0.16 per kilo from NOK 1.25 in the same quarter last year. The VAP share was 23% of the volume in the first quarter, down from 46% last year. The contracts have been reduced significantly to only 9% of the whole volume for the full year. This relates mainly to the new tax regime in the Faroes Islands. Looking at the market breakdown, which we see on this page. We see that from the Faroe Islands, the EU market dropped 11% market share to 57% of the total sales from the Faroe Islands. The U.S. market increased their market share, 9% from 17% to 26% of the total sales from the Faroes Islands. From Scotland, we see that EU and U.K. increased 19% market share to 76% of total value sold. And the U.S. market dropped from 17% to 10% market share. So coming to outlook for the sector or for the market place, there is a low supply — should be supply growth to be expected. The trend continues with lower productivity than expected, especially from European harvest. But also, Americas are affected, where harvest is adjusted somewhat down from the first half of ’24. So this development seems to continue with downwards adjustments. Main reason for lower productivity are biological challenges in most regions, causing production yield to drop. The first quarter ’24 showed a global drop of supply of salmon of 5%. The low single-digit growth will continue from Europe because of the uncertainty in biology, especially in Norway for the time being. The global market is therefore expected to see reduced harvest in the first half of ’24 and only 1% growth for ’24 as a whole, which will lead to continued tight markets. And finally, coming to the outlook. Our farming guidance is unchanged, 91,000 tonne for ’24. However, there are some twists of breakdown between quarters. While the second quarter is reduced slightly in Faroes from 16.5 to 12.5, both because of higher harvest in the first quarter and some other changes. Scotland is expected to increase slightly in the second quarter versus original plan from 11,000 tonne to 12,000 tonne, mainly driven by better growth. Page 2 reduced with the same volume, which, therefore, all in all brings our guidance unchanged. Looking at the fresh water, there are slightly negative revisions in both regions. Faroes Islands from 17.8 to 17.0, driven by slightly later ramping up speed on the hatcheries than expected. Similar development in Scotland with 6 months set back in timing. Therefore, taking a smolts transfer guiding from 9.3 million to 8.2 million. On the contracts, no change, low contract exposure only 9% of expected harvest volumes for the full year. And for the FOF segment, we see continued high production volumes of fishmeal, but expect normalization of fish oil production to lower levels than last year. However, we expect increased feed sales on feed production this year, as biomass is expected to grow. Coming to strategy. Our Capital Market Day last year, we focused on our organic growth strategy to grow capacity to 200,000 tonne and actual production to 165,000 tonne by ’28, focusing on sustainable growth. Our focus is to grow sustainably with a high focus to utilize our competitive advantage in the value chain and especially to differentiate ourselves in the marketplace focusing on the world’s best salmon. That was our presentation, and we will open up for questions if there are any questions. Nodrby go ahead.

Q – Christian Nordby: Yes. Thank you. On the cost side in Scotland — can you give an indication on what to expect on farming costs and then potential provisions in Scotland in Q2 compared to the first quarter?

Regin Jacobsen: Yes. I gave you some numbers on the cost. So what I said was that there’s a 5% increase in Scotland in the first quarter in our costs compared with the first quarter last year. And that this 5% increase cost corresponded to NOK 4.17 per kilo hog. So this is only the farming costs. We also have, of course, harvesting and well boats in relation to harvest, which are also high compared to our high per kilo, and this relates very much on a low production. So we are focusing at the moment on how we can manage — better manage our costs compared to the actual production, which is quite low for the time being in Scotland.

Christian Nordby: From Q1 to Q2, do you see the same type of cost level? Or do you see that with higher volumes?

Regin Jacobsen: One of the driver for the relatively high cost base in Scotland is the biology. The biology is compromised in Scotland general. The mortality ratio is far too high. And therefore, our strategy on the short term has been to reduce the biomass to get more effective, productive operation. And when we have more effective and productive operation, then we will scale up. And that’s why the large smolt is very, very essential. And unfortunately, this has now been delayed 6 months, which means that the scaling up will be also delay 6 months. So bringing better biology in place in Scotland will be the biggest driver to reduce costs, a lot of the costs are also related to volume. So getting a better size will be important, but that’s important to have the good biology first. When it comes to feed costs, I can say, which I indicated that there are lower costs of raw material now, which is an indication that feed cost is coming slightly down, not very much, slightly down, which will have a positive impact on the feed costs, both in Paris and Scotland. Regarding the one-off, which you also asked on, this relates to the feed part that went down last year, where we have now the details on these numbers, which we have put a provision on. And is that okay?

Christian Nordby: That’s fine. Thank you very much.

Regin Jacobsen: Alexander Jones, go ahead. Alex, I cannot hear you. Can you try again? Okay. Maybe we try (Indiscernible) first, then we can try Alex again, if it works for you after.

Unidentified Analyst: Sure. Just help me understand with this new reporting segments, the operational EBIT from eliminations has been very volatile. And this quarter, it’s positive. So could you help us explain the volatility? And should we expect sort of positive eliminations in the first half of the year or negative in the second half? Or is there some other reasons for this volatility?

Regin Jacobsen: (Indiscernible) have a good answer on the eliminations. Eliminations is — so one of the driver for the eliminations is, of course, the internal margin, which is eliminated in each quarter. And that goes a bit up and down with the biomass if the biomass increases or reduces that the feed costs, where there is a large margin, both on the fishmeal oil and the feed itself because when the fish is harvested, that’s only when we will take the profit. So the whole value chain has eliminations except from that. Is there anything else, (Indiscernible) in the eliminations? (Indiscernible) be. Yes, yes, the whole value chain. So that refers both to the smolts, the feed, fishmeal oil. And now, of course, other services, which are on biomass in the water. I’m not sure Alexander, is there any special…

Unidentified Analyst: I can give a call afterwards if we can discuss it in a bit more detail.

Regin Jacobsen: Yes.

Unidentified Analyst: And just a follow-up question on a different matter on the Applecross 5 and 6. Is there any reason to suspect you’ll have the same construction issues there as you had in AP4?

Regin Jacobsen: That’s a good question. I believe not. My best answer, Alex, is that we should not expect the same issues. We hope that — I mean there seem to be new things coming up. But on this side in Scotland, these issues now in the first quarter relates to the cooling system and seawater, and that’s for the whole site, which now should be fixed. So that — that’s failure, which have been discovered now, but that seems also to be — haven’t been the driver for the issues we saw in the fourth quarter, but this was discovered now only in the first quarter. So this has been resolved. There have been massive investigation during the last 6 months, but only now this problem difficult to find was realized. So I don’t expect this to continue from Alexander. Okay. Christian?

Unidentified Analyst: So you previously guided on 95,000 tonne from the Faroes in 2026. How do you see this figure now that you’re somewhat delayed in the Faroes on the smolts facilities?

Regin Jacobsen: Not necessarily because of this delay, not necessarily, a bit difficult for me. We have not guided yet on ’25 and ’26. But I would say we have all the capacity in place. So there might be a short delay in ’25, but not necessarily in ’26 I don’t think that relates to ’26. Alexander?

Unidentified Analyst: Yes. Thank you. Two questions on the FOF segment. The first is your expectation on prices maybe a primary on fish oil with fisheries in Peru now back with a good quarter. And the second question on whether we should expect a continued strong margin in the segment? Or if that should trend somewhat downwards into the rest of ’24?

Regin Jacobsen: Yes. We have said for a long time that ’23 was an exceptional year for our fishmeal and oil segment. We don’t expect that to continue. So — but it looks like the blue whiting quotas are good. So we expect a relatively high fishmeal operation, but lower fish oil operation. On the prices, I mean if the prices are high, it’s good for our margin in the FOF’s prices are low, it’s good for our cost price in the farming. So that’s a balance. We expect the prices to be somewhat lower than on the peak in the fourth quarter, but not necessarily. I don’t know very much about that, but not necessarily to collapse. That’s not where we expect the prices to go. There is a strong demand for fishmeal and oil. So yes, I cannot give you much more details on that. As you said, there are more catches now in Peru show we catches, but that’s not — it’s in line with what you have seen in previous years. Last year was an exception in Peru, where there was an all-time low quota on the first half of the year, and that’s now more or less back in normal conditions.

Unidentified Analyst: Okay. Thank you.

Regin Jacobsen: (Indiscernible)

Unidentified Analyst: Just a quick question of course, been a fair increase in average weight in the Faroes. Just wanted to ask how you see this going forward?

Regin Jacobsen: Yes. As said, in the first quarter, this was all-time high average weight for our first quarter. So that’s very good. We have — this is very much driven by a very strong biological development. And we see also that we control very much now — we are masters of our fish farming and not the biology as we have seen very often. So therefore, we have a better possibility to keep the fish in the water until they have the right market size. So that’s what we will focus on going forward. And that’s also why we keep some of the fish longer now, plan to keep it longer now in the second quarter than originally planned. So the idea is to be on the right size of 5 kilos, but not necessarily 5.5 kilos. So somewhere between those two numbers.

Unidentified Analyst: Also just a quick question, what is the reason for the slower ramp-up in smolt release in the Faroes that you guide for ’24?

Regin Jacobsen: So this is very much driven by the ramp-up of capacity of our hatcheries in the Faroes. So last year, we increased the capacity by 50%. So we are in a ramping up period of the freshwater operation. And ramping up is always a bit risky. And we have seen that we are a bit delayed compared with the original plan. So that’s why we see that some of these fish that were expected to go into the water in the fourth quarter. Most likely, as we see it right now, will be better to keep two months longer on the hatcheries where we now have plenty of available volume. I then release them in February, last quarter instead when the temperatures are ticking upwards instead of taking downwards in November, December. So that will give us a better harvest, both in ’25 and also in ’26. So that’s slow — a slower ramp-up than originally expected.

Unidentified Analyst: Thank you.

Regin Jacobsen: Okay. I see no further questions. So — but you’re always welcome to give a call if there are any further questions. Thank you very much.

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