News Industry update
Andfjord Salmon Group secures $33 million for Kvalnes facility expansion

Andfjord Salmon Group AS has reported that its build-out at Kvalnes, Andøya, is progressing as planned. The company also completed an equity raise of NOK 350 million (US$ 33 million), attracting new industrial investors.

Current shareholders in Andfjord Salmon: Jerónimo Martins Agro-Alimentar S.A and Eidsfjord Sjøfarm, invested their respective pro-rata ownership shares in the private placement while High Liner Foods Incorporated, a seafood processor and marketer, invested US$ 10 million in the private placement and is a new shareholder in Andfjord Salmon.

“Our build-out is progressing well. During the first quarter, we identified an additional revenue stream that strengthens our business case. We also received another report confirming strong biological conditions in our first production cycle, which contributed to the success of last week’s equity raise,” said Martin Rasmussen, CEO of Andfjord Salmon.

A science-based approach

In its press release, Andfjord Salmon said it has chosen to take a science-based approach to land-based fish farming and asked Nofima to document biological conditions and fish welfare in the first pool.

Nofima submitted a final documentation report, covering the full production cycle. The examination of biological conditions, fish welfare and fish health states that “Andfjord Salmon applied a very comprehensive welfare and health documentation plan for the first production cycle.”

In this report, Nofima recorded a large number of operational welfare indicators for the salmon, including environmental factors in the pool, fish behaviour, growth and fish health. 

“The fish farming industry is under pressure to improve biological conditions, fish health and welfare. Although we are still only a small player in a large global industry, this report shows that our land-based flow-through system is capable of enabling fish-friendly salmon farming,” said Rasmussen.

Expansion Plans

During the first quarter, Andfjord Salmon announced plans to utilize surplus pool capacity after smolt release to release even more smolt in its land-based pools. This additional smolt will be sold to ocean-based fish farmers in the region after 5-7 months, when the fish weighs 1 kilogram. This strategy is expected to enable 10 per cent higher biomass turnover, which in turn means an estimated 15-25 per cent increase in EBIT. 

In the first build-out phase, the company is completing four new pools, which brings total production capacity to 8,000 tonnes Head on Gutted (HOG) at Kvalnes in 2025. It’s targeting a total production capacity of 40,000 tonnes (HOG) at Kvalnes through gradual volume increases between 2025 and 2030. It is developing waterways and a harbour area, that will support future production capacity.

In January, Andfjord Salmon announced that the excavation of the next 12 pool pits at Kvalnes had been completed ahead of schedule. The facility that will produce concrete elements for pool walls and floors has now been set up and is ready for production. This facility will utilise excavated masses from pool pits as concrete ingredient to reduce costs and environmental footprint.

Since Andfjord Salmon is currently expanding its Kvalnes facility, there’s been no salmon production and only minor revenue in the first quarter of 2024. The company had an operating loss of NOK 17 million in this year’s first quarter, versus a loss of NOK 13.9 million in the same quarter last year. 

“All in all, we are satisfied with the progress we are making, and we are pleased to see that reputable industrial investors recognise this by investing in Andfjord Salmon,” says Martin Rasmussen.