9 February 2007

HJALTLAND SEAFARMS REPORTS RECORD PROFITS

The largest salmon farming and processing company in Shetland, Hjaltland Seafarms, has reported record profits for 2006 with an operating profit of £11.9 million and a profit, before tax, of £10.9 million.

The company’s managing director, Michael Stark, said:  “2006 has been our best year ever.  We believe the Hjaltland Group achieved amongst the highest operating margins – if not the highest – in the UK and notably better than those of the larger international stock exchange listed companies.

“With an operating margin of 33 per cent for 2006 and a strategy for continued improvement of market and cost position relative to the sector, we feel the future is looking bright for Hjaltland Seafarms.

“We attribute our success to adopting a way of working that integrates our farming, processing, sales and marketing into one very efficient and streamlined system.  The integrated approach allows us to keep a very close eye on our margins.  It also gives us more product diversity and resulting flexibility in the marketplace enabling us to focus completely on market requirements, so we can deliver the right product at the right time.”

Hjaltland Seafarms Group currently produces over one third and processes 50 per cent of Shetland’s total salmon production.  Michael Stark continued: “In 2006 we processed 19,000 tonnes of salmon and sea trout and around 3,000 tonnes of salmon fillets at our processing arm, Lerwick Fish Traders Ltd. 

“Hjaltland Seafarms prides itself on the fact that it is the only company within the European Union that can pack salmon fillets in different trims pre-rigor in less than one hour.

“In 2007, the company is set to increase its farm site production to over 20,000 tonnes – a strong increase from 15,110 tonnes in 2006.

“Our significant growth has been achieved by expanding our farming operation through acquisitions and development of new sites in 2005 and 2006, enabling us to increase our share of the market for superior quality Scottish salmon from Shetland.

“We have achieved such impressive profitability – relative to our peers – through adopting efficiency as an integral part of our work philosophy.  We have managed to reduce our production cost by nine per cent over the last two years despite the sharp increase of 15 per cent in feed costs and, at the same time, enhance our product quality.”

The Hjaltland Group has now started construction of its £3.6 million processing plant in Lerwick where it will start producing smoked and cured salmon as well as other finished or semi-finished products at the end of the year.  The company’s ability to process fish pre-rigor will secure a fresher product with a longer shelf life than its competitors.