Lerøy Seafood Group ASA: Capital Markets Day 2022 - Continued profitable growth towards 2025
Lerøy Seafood Group (“LSG”) is hosting its inaugural Capital Markets Day today September 22nd, 2022 at Hitra in Norway. The main topic will be LSG group strategy with a particular focus on the farming segment. Financial and operational targets for 2025 will be launched.
20 YEARS OF PROFITABLE GROWTH WHILE DEVELOPING A FULLY INTEGRATED VALUE CHAIN
Over the past 20 years LSG have developed a fully integrated value chain for seafood with an average revenue growth of 12% p.a. and a return on capital employed of 17% p.a.
LSG operates salmon and trout farms across three regions in Norway and has a substantial wild catch operation completing the product offering. The downstream operation in VAP S&D is growing and an increasing share of the groups raw materials is processed through the groups value chain. Our sales and processing operations now span 14 countries.
THE WORLD’S MOST EFFICIENT AND SUSTAINABLE VALUE CHAIN FOR SEAFOOD
Historically, value chains for seafood have been very fragmented and not suited to meet increasingly complex customer requirements. By comparison, LSG’s fully integrated value chain is more reliable, faster and cost efficient. The group’s sustainable value chain supports full traceability, quality assurance and increased value creation through product innovation. This is what our strategic customers expects and what we work for every day. This is our competitive advantage, comments CEO Henning Beltestad.
FINANCIAL AND OPERATIONAL TARGETS FOR 2025 AND BEYOND
Executing on strategy is the key for continued high profitability. Our targets presented at the Capital Markets Day today are:
- Revenues of NOK 50bn by 2030
- Market leading EBIT pr kg for farming and VAP S&D by 2025
- Segment EBIT, VAP S&D: NOK 1.25bn by 2025
- Segment EBIT, wild catch: NOK 500m by 2025
- Farming: Harvest volume (Norway) of 205,000 GWT by 2025
For the farming segment targets for operational efficiency towards 2025 include:
- Production cost reduction of NOK 4.6 pr kg in 2025 (measured in 2021 money)
- Economic feed conversion ratio of 1.19
- 4.5 kg average harvest weight
- 93% of salmon and trout to be superior quality
Like any business today, Lerøy is experiencing cost inflation, however we aim to counterbalance this through operational improvements, says Beltestad.
HOW WE WILL REACH OUR TARGETS
LSG will strengthen and develop our core business by:
- Improving biology, as described below
- Improving sales- and production planning
- Increasing share of volume to strategic customers and attract additional strategic customers
- Increasing the share of raw materials processed through the groups value chain
- Accelerate digital transformation and automation
As regards biology, LSG aims to increase survival rate, increase growth rate, increase utilization of license capacity and improve harvest quality while further strengthening the position as a global climate and environmentally sustainable food producer. Farming volumes have increased by 9% p.a. last three years driven by post-smolt investments. The strategy for post-smolt has proven successful, but there is still untapped potential. COO Farming, Bjarne Reinert will elaborate on this at today’s event.
Our goals are ambitious yet obtainable. The common theme is operational improvements across all our segments. We have clearly defined initiatives to achieve operational excellence which we will demonstrate today. I am confident we are on the right track for continued profitable growth, says Beltestad.
LIVE WEBCAST
The presentations can be followed through a live webcast and the slide deck is available on https://www.leroyseafood.com/en/investor/capital-markets-day-2022/
The agenda and timeline for September 22nd 2022 is as follows:
- 12:00-13:30: LSG group strategy followed by Q&A. Presented by CEO Henning Beltestad
- 13:45-15:30: Farming strategy followed by Q&A. Presented by COO Farming Bjarne Reinert
For participants at the physical event, practical information was distributed through text messages on September 19th.
For further information, please contact:
- CFO Sjur Malm, phone +47 417 72 020
- CEO Henning Beltestad, phone +47 911 43 545
- Head of Treasury and Investor Relations Hans Ljøen, phone +47 481 87 750
ABOUT LERØY SEAFOOD GROUP ASA
Lerøy Seafood Group ASA is a global seafood corporation with its head office in Bergen. The Group’s approx. 5,500 employees process about 400,000 tonnes of seafood every year via our value chain, corresponding to around 5 million meals every day. The Group has a vertically integrated value chain for red fish and whitefish, and significant activities using third-party products.
The Group’s values – open, honest, responsible and creative – shall underpin everything we do, and we work hard to achieve our goal of creating the world’s most efficient and sustainable value chain for seafood. The target for return on capital employed (ROCE) is 18%. The Group has set a number of targets within sustainability, including cutting greenhouse gas emissions by 46% by 2030.
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