Marine Harvest ASA (MHG) fell the most in almost three months in Oslo trading after the biggest salmon farmer said fourth-quarter profit will miss analyst estimates because of “very weak market conditions” in Chile and Canada.
Shares in Marine Harvest declined as much as 3.4 percent, the most since Oct. 29, and traded 2 percent lower at 5.055 kroner as of 10:15 a.m. in the Norwegian capital, making it the biggest loser on the Bloomberg Europe 500 Food Index. (BEFOOD) More than 22 million shares have been traded so far today, 36 percent more than the average daily volume during the last three months.
Marine Harvest, based in Oslo, will report fourth-quarter earnings before interest and tax of about 60 million kroner ($10.7 million), down from 403 million kroner a year earlier, it said in a statement today. That compares with the 199.9 million kroner average of 11 analyst estimates compiled by Bloomberg.
While Marine Harvest saw “strongly improved” conditions in Norway in the fourth quarter and into 2013, that performance was offset by weakness in Chile and Canada, it said. Demand in Chile in particular was hit by the discovery of the listeria bacteria by smoked salmon producer Delifish, which resulted in recall costs, the Norwegian group said.
“The results are a mixed bag, with strong earnings and low costs in Norway and weak results in the American market,” Pareto Securities said in an e-mail to clients. “The U.K. also disappointed.”
Marine Harvest’s guidance is 117 million kroner less than Pareto had been expecting, said the broker, which has a buy rating and 12-month price target of 6.3 kroner on the stock.
The weak market conditions in Chile and Canada have continued into the first quarter of 2013, TDN Finans reported, citing Finance Director Ivan Vindheim. Marine Harvest harvested 103,000 metric tons of fish in the fourth quarter, ahead of its own 101,000-ton guidance, it said.
Shares in producers tumbled last year as prices fell 60 percent to 18 kroner a kilogram from April to October amid rising output from Norway and Chile, the world’s largest fish farmers. Prices have since recovered to about 32.12 kroner a kilo, according to the latest available data from NOS Clearing ASA, a clearing house for freight and commodities contracts.
Marine Harvest shares have gained more than 60 percent during the last 12 months, giving it a market value of 18.2 billion kroner. The company will announce its fourth-quarter results on Feb. 6.
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