Good morning, and welcome to the presentation of Bakkafrost's results for the third quarter. My name is Høgni Dahl Jakobsen, CFO of Bakkafrost. This morning, we will go through the performance of the group, the developments in the salmon market, financial results, the progress we are making in the operation across our regions. We will also be sharing the expectations for the rest of this year and also the plans for next year. As usual, the presentation contains forward-looking statements that are subject to uncertainty, so please refer to the disclaimer in the published presentation.
First, a summary of the quarter. The group delivered an operational EBIT of DKK 128 million in this quarter compared to DKK 22 million in the third quarter last year. Revenues were broadly unchanged at around DKK 1.7 billion. We harvested 27,600 tons in the quarter, around 10% below last year, with lower volumes in both the Faroes and in Scotland. In the Faroe Islands, biological performance remained strong, although we harvested smaller sites, which contributed to higher unit costs. In Scotland, we continue to see improvements in the biology, but low harvest volumes, harvesting smaller fish, and some biological challenges affected also the result in this quarter, especially in July and towards the end of the quarter.
In the FOF segment, we have capitalized on our inventory of fishmeal lying at low cost price, leading to very strong results in the quarter and more than doubling the operational EBIT for that segment compared to last year. Marine sourcing was low, 9,600 tons, significantly lower than the same quarter last year, while feed sales were broadly unchanged. Overall, this quarter was a quarter with improved earnings year-on-year, despite lower harvest volumes, continued pressure on salmon prices in a market with high global supply.
Looking at margin development across the two farming regions, in the Faroes, the integrated value chain generated an operational EBIT of DKK 11.57/kg , up from DKK 8.93/kg last year. In Scotland, we reduced our loss per kilo from DKK 38.72/kg- DKK 30.79kg in this quarter. An improvement, but still far from being satisfactory. At group level, operational EBIT increased from DKK 0.72/kg- DKK 4.61/kg. In other words, improvements in both regions, but very significant differences in operational performance. Moving on to the salmon market, starting with supply and then looking at demand and prices.
According to the latest update from Kontali, global harvest of salmon increased by around 5% in the third quarter, while quantity supplied to the market, if we include inventory movements, increased by almost 7%. Europe was the main driver, with a supply growth of around 8%. Norway continued to benefit from good biological conditions, lower mortality, resulting in substantially higher production and around 9% increase in harvest. In September, Norwegian harvest has partially also been driven by accelerated harvest due to maximum allowed biomass limits. In contrast, supply from Americas declined by 4%, following several quarters with strong growth in the Americas.
Despite increase in global supply, which has been ongoing now for several quarters in a row, the demand for salmon has been remarkably strong. In this quarter, sale to the European market increased by approximately 10%, exceeding the 8% volume growth from Europe. We expect some of this volume to have been absorbed in the European processing industry with some buildup of frozen inventories. In the U.S., demand remains stable while supply from the Americas declined. Asia was more mixed, continued growth in China, while Japan was weaker.
We also saw strong growth in Middle East and Latin America. Hence, salmon demand continues to demonstrate considerable resilience. Even with substantial additional volumes entering the market, consumption has continued to grow across most major regions. Turning to prices, the average reference price for 4 kg-5 kg salmon was NOK 66.87/kg , an increase of 5% year-on-year. Prices were 9% lower compared to previous quarter, reflecting the seasonal pattern and increased supply. Towards the end of the quarter, we saw premium for large fish normalizing.
That has been under pressure during the whole year, but it is now gradually returning to normal levels again. That is important for Bakkafrost as we focus on producing large, high-quality salmon. Looking forward, the supply is becoming more favorable. Global supply is expected to decline in the fourth quarter, followed by very limited supply growth in 2027. Combined with the underlying strong demand that we have seen, this provides a potential for a more balanced market environment going forward. Moving on to the financial results, and starting with the group P&L. The revenues in this quarter were DKK 1,681 million, broadly unchanged from the same quarter last year.
Increase in operational EBIT from DKK 22 million- DKK 128 million. Improvement was mainly driven by stronger earnings in the FOF segment, and also reduced losses in Scotland. However, partially offset by weaker contributions from other segments. Fair value adjustments were positive with DKK 231 million. After financial items and taxes, the group reported a net profit of DKK 191 million compared to DKK 77 million in last year. This slide puts the current earnings into a longer-term perspective. For the first nine months of 2026, operational EBIT has reached DKK 944 million, thereby exceeding the DKK 888 million generated through the entire last year.
Adjusted earnings per share was DKK 0.5, bringing the year total to DKK 7.97 per share. Our balance sheet remains solid, with total assets of DKK 19.6 billion at the end of the quarter. Equity amounted to DKK 11.2 billion, corresponding to an equity ratio of 57%, compared to 58% at the end of 2025. Property, plant, and equipment increased moderately to DKK 7.3 billion as we continue investing in our value chain. We also saw an increase in inventory to DKK 1.2 billion and receivables to DKK 835 million, while the carrying value of the biological assets remained broadly unchanged. Cash and cash equivalents increased to DKK 523 million, up from DKK 300 million at year-end.
Overall, we maintain a solid financial position to support the ongoing operations and investment program. Moving to cash flow. Cash flow from operations were DKK 149 million compared with DKK 245 million last year. The first nine months, however, operating cash flow increased significantly to DKK 875 million compared to DKK 631 million in 2025. Investment cash flow was negative with DKK 209 million, and cash flow from financing activities contributed with DKK 255 million during the quarter. Cash at the end of September was DKK 523 million. Our net debt has increased somewhat during the quarter and amounted to DKK 4.1 billion at the end of the quarter.
That reflects ongoing investments, changes in working capital, partly offset by generated cash from operations. We continue to have substantial financial flexibility through our bank facilities, with undrawn credit facilities of approximately DKK 1.3 billion. Our financing arrangements provide a solid foundation for the group's investment program while maintaining a disciplined approach to capital allocation and liquidity management. This concludes the financial review, but before handing over to Regin, I want to point your attention to slide 31 in the presentation. I will leave that for self-study, but we have included it to give more details on eliminations, which can cause some struggle when trying to estimate the results for the group and also how that is split amongst the different segments.
We have three segments generating internal profits, which are eliminated out on the biomass. That is from smolt, it is from feed, and it is from the FSV segment. Those three segments have, to date, primarily been dominated by eliminations from smolt, but with the recent changes in feed prices, feed is picking up and becoming more dominant. Please have a look at slide 31, where we have included more details from the Faroese part of the organization, that can give some better insight in the dynamics of how those eliminations are working and have done so over time. With those words, I will hand over to Regin to go through the operations.
Thank you very much. On this image, we have an overview of the northern east part of Faroe Islands, where we can actually see a lot of our farming sites. In this quarter, we harvested from Árnafjørður, Borðoyarvík, and Lambavík, which is further to west and is not part of the image. Those were the three main sites that we harvested from in this quarter. Let me first start with our fully vertical value chain, which is a very important part of our competitive advantage in Bakkafrost. Challenges seem to change or shift between different parts of the value chain, and our integration gives us greater control and flexibility in these challenges.
A good example now is the raw material market, where we this year experience some of the most challenging conditions we have seen in the history of the industry. Fishing in South Pacific has been exceptionally poor this year, resulting in a significant global shortage of marine raw materials, which has caused increasing prices on these. This is where our integrated value chain makes a real difference. Through Havsbrún, we have control over production of fishmeal, fish oil, and salmon feed. Our strategic inventories of fishmeal cover our expected requirements well into 2027, allowing us to maintain a strong focus on feed quality, fish welfare, and also the salmon nutrition.
We maintain a relatively high proportion of marine ingredients in our feed, supporting fish health, omega-3 content, natural pigmentation, and consistent product quality. Our new feed factory will come into operation in this quarter, adding an important advantage. It provides significant greater flexibility in feed formulation and raw material utilization. This flexibility will help us to manage the risk of persistently high marine raw material prices while maintaining our natural and quality standards. This is the strength of our integrated value chain, giving us greater control, flexibility, and resilience, particularly while market conditions are challenging.
We see strong feed sales in this quarter, rising raw material prices. As we now move to Havsbrún, we continue to see strong operations despite an exceptionally challenging market for marine raw materials. In the third quarter, we sourced only 9,587 tons compared to 39,000 tons last year, or close to 40,000 tons, a reduction of 76%. The limited availability of marine raw materials reflects the challenging fishing conditions, including the exceptionally poor fishing in the South Pacific. However, feed sales remain strong. We sold 48,237 tons of feed, which is 2% down from last year.
All feed sales in the quarter were to our own farming operations, and our strategic inventories have allowed us to maintain feed production and high quality despite the limitation of availability of raw materials. External fishmeal sales dropped to 1,206 tons compared with 5,118 last year, down 76%, and external fish oil sale is close to zero, only 6 tons. When we look at the price chart for raw materials, we see that marine ingredients have significantly increased, reflecting the tight market situation. Financially, Havsbrún delivered a strong result, DKK 209 million compared with DKK 91 million last year, an improvement of DKK 118 million, and the margin increased from 12- 24%.
Year- to- date, operational EBIT reached DKK 412 million compared with DKK 244 million last year. Looking ahead, we see a good flexibility with our new feed factory, with a good flexibility also to look into raw materials utilization and feed formulations. Combined with our strategic inventories, this will help us manage the risk of high marine ingredient prices while maintaining our focus on high feed quality, salmon nutrition, and fish welfare. Coming to freshwater in the Faroes, we see continuation of progress in our strategy. We transferred 4.5 million smolt in this quarter with an average weight of 466 g. The average smolt weight increased 9% year-over-year.
The new hatchery in Skálavík is now in operation, and the second batch has entered production. We have increased the 2026 transfer plan to 20.7 million versus 20 million previously. For 2027, we plan approximately 21 million at an average weight of 440 g. The operational EBIT was DKK 68 million compared with DKK 83 million last year, a reduction of DKK 15 million. Per kilo, this was NOK 47.31 compared with NOK 64 last year, and a margin of 30% versus 36%. Year-to-date, we see DKK 240 million in EBIT compared with DKK 225 million. Coming to the farming operation in the Faroe Islands. In this quarter, we harvested smaller sites. As mentioned, Árnafjørður was the weakest site in the quarter. The average weight of the fish in Árnafjørður was 4.5 kg.
4,600 tons out of the 23,000 was from Árnafjørður. 4.5 kg, and the reason for harvesting smaller fish in Árnafjørður was CMS. We had some CMS issues in Árnafjørður, and that's why we harvested early to maintain a high fish welfare. The average harvest size in the quarter was 5 kg for all fish compared with 5.2 kg last year. Ring-side cost in the quarter was 7% up from DKK 29.20- DKK 31.20, DKK 2 higher cost per kilo in this quarter compared with last year. The mix of these sites, smaller sites, contributed to the increase. Firstly, if you look at feed cost in this quarter, feed cost was DKK 16.33/kg , which is 45%. The increase was DKK 0.89 øre per kilo in increase in this quarter compared with last year, up to DKK 16.33. That was 45% of the difference from last year, of the total difference.
Secondly, as we have harvested smaller sites, they are a bit less productive, so we have a bit higher salaries, which is DKK 1.5/kg , and the difference is 30% up. From DKK 1.20- DKK 1.50, something like that. Cost discipline is still a very high focus with Bakkafrost, and we have focused to reduce costs going forward, which is a part of our approach for next year. When you look at the biomass in this quarter, we had approximately 56,200 by the end of the quarter compared with 57,200, 1,000 ton down. A relatively stable biomass position.
Feed consumption was 35,400 ton compared with 38,700 last year. Sea temperature during the quarter was somewhat about the historical average. Farming operation improved 21 million in the quarter from - 29 million to - 8 million. Operational EBIT improved from NOK -178/kg to NOK -0.5/kg . The operational EBIT margin improved from - 3% to - 1%. Although earnings have improved, the farming segment remains slightly negative during the quarter.
Year-to-date, harvest volumes in Faroes are around 75,000 ton compared with 60,000 last year, up around 15,000 ton. Operational EBIT increased to 487 million compared with 262 million last year. This reflects significantly stronger performance over the first nine months. Overall, we remain satisfied with the biological development in the Faroe Islands while maintaining strong focus on cost efficiency and harvest performance. Looking at the recent completed production cycles, we still see difference in biological performance in the Faroes.
There are some sites slightly more efficient than others. In particular, we see opportunities to improve growth and reduce mortality going forward. The average full cycle mortality in the Faroes is around 10%. If you calculate the GSI number, we are around 6%. Our aim is to go down to around 4%-5%. Our focus is not only increasing production volumes, but also on improving survival, growth, and feed efficiency through the entire production cycle. Looking at the services in the Faroe Islands, our service activities continues to operate reliable during the quarter.
The segment covers fish transportation and treatments, farming support, harvesting, and packaging, as well as our biogas operation. An important biological indicator is survival during the first 90 days after smolt transfer. In our third quarter numbers, survival was approximately 97.6% in the first 90 days, broadly unchanged from the same quarter last year and slightly improved from the second quarter. The EBIT from this quarter was DKK 28 million compared with DKK 38 million last year. The operational EBIT per kilo was NOK 1.49/kg compared with NOK 1.97/kg last year. The EBIT margin declined from 15%- 12% in this quarter.
However, year-to-date, operational EBIT increased to DKK 105 million compared with DKK 93 million last year. Our focus in this segment remains to focus on efficient operations, fish welfare, and maintaining reliable services capacity through the production cycle, the VAP activity and the growing exposure to the U.S. market. When we look into the sales segment and other, we continue to see strong activity in value-added process and increase in this activity. Volume transferred from Faroese farming into VAP increased 19% in the quarter from 4,823 tons- 5,719 tons in this quarter. This corresponds to approximately 25% of the Faroese sales volumes compared with 19% last year.
At the same time, our sales of whole gutted salmon declined 15% from 25,855 tons- 21,915 tons in this quarter. The sales volumes was 27,634 tons compared with 30,678 tons last year, a reduction of 10%. When we look at the market development, we see a strong increase to the U.S. market. 33% of the Faroese sales went to North America compared with 24% last year. Western Europe accounted for 47% compared with 56% last year. This reflects a changing geographical sales mix and the importance of maintaining access to several attractive market regions.
However, increased global supply continues to put pressure on price premiums in this quarter. The segment operating revenues increased by 7% from DKK 2.462 billion- DKK 2.641 billion. Operating EBIT was DKK 62 million compared with DKK 73 million last year, and per kilogram from NOK 3.75- NOK 3.28 per kilo. The EBIT margin was 2% compared with 3% last year. Year-to-date, operational EBIT reached DKK 224 million compared with DKK 211 million last year. We focus on investment in processing, in value-added products, and also flexibility and access to many markets.
Coming to Scotland, looking into the freshwater segment, we see Applecross is ramping up. We see improvement in production efficiency. Applecross is central to the improvement of the biological and financial performance of our Scottish farming operations. As we have explained previously, the expansion of Applecross was a substantial investment, and the commissioning process have been challenging. Following several technical and biological setbacks, production has become more stable, and we are now seeing a significant increase in production. The average number of fish in Applecross tanks increased by 1.4 million to approximately 12.8 million fish by the end of the third quarter.
Quarterly smolt production increased 74% from 340 tons in the second quarter to 592 tons in this quarter. This is encouraging and demonstrates the progress in scaling up the production. During the third quarter, we transferred 2.9 million smolt compared with 3.6 million last year. Of these, 1.2 million were externally sourced compared to 0.9 million last year. Average smolt weight of all transferred smolt increased 7% from 155 g- 166 g. From Applecross, the average weight of transferred fish was 221 g compared with 229 g last year.
If you look at the cost development of the smolt operation, we are still far behind. It takes time to get the cost down to a reasonable level of transferred fish. We have decreased the cost from DKK 236/kg in the second quarter to DKK 180/kg in the third quarter. This corresponds to NOK 63/kg in the Faroe Islands. Roughly three times higher per kilogram. But I am pretty sure that we will end up more or less in the same position. This is still in the scaling up process. However, we see a significant quarter-on-quarter improvement.
We are in good faith on the expectations. Operational EBIT improved to DKK -14 million compared with DKK -38 million last year. The EBIT margin improved from - 51% to - 22%. We remain on track for approximately 10 million smolt this year, with an average weight of 179 g. For 2027, we plan to transfer 11.5 million smolt, with an average weight of around 222 g, all from own smolt production. This also includes small batch from our own Native Hebridean strain, which is produced for us by Landcatch, which is classified as internal smolt supply then. Increasing production and capacity utilization at Applecross is essential for reducing unit cost and improving the performance of our Scottish farming operation.
We believe that eventually we can, with large smolt from Applecross, we can farm the fish in the marine sites only one year in Scotland. Coming to the farming operation, the marine farming operation in Scotland, biological improvement profitability still remains challenging. The Scottish farming biological and financial performance remains challenging, although we are seeing encouraging developments. We harvested only 4,537 ton in the quarter, compared with 5,286 last year, a reduction of 14%. The average harvest weight was only 3 kg in this quarter, compared with 4.8 kg last year, a reduction of 38%.
This is clearly not satisfactory. We harvested several challenged fish populations during July and September, which affect both harvest weights and financial results. Some of these challenges are also expected to influence the fourth quarter. One encouraging development in Scotland is the reduction of exceptional mortality cost. Although these are still far too high, they have come down. In this quarter, DKK 42 million compared with around DKK 70 million last year. This represents a reduction of approximately 40%.
Also, the survival chart provides an important evidence supporting our larger smolt strategy. After 12 months at sea, we see the larger smolt groups achieving approximately 84% survival, compared with 71% for the smaller groups. This difference of around 13% points is encouraging and supporting our strategy. We want to increase smolt size and reduce the time the fish is in the sea, although performance also depends of other biological and operational factors. The operational and financial performance improved on the EBIT side by DKK 53 million, from DKK -191 million to DKK -138 million. EBIT per kilogram improved from NOK - 57 to NOK -45.
The EBIT margin improved from - 96% to - 73%. However, year-to-date operation remains negative at DKK 340 million, compared with DKK 302 million last year. The ring-side cost, if you look at only the ring-side cost when the fish is ready for harvest in Scotland, increased from DKK 48/kg- DKK 50/kg . That's slightly DKK 20 in difference from the Faroe Islands. Of these DKK 20 in difference, DKK 30-DKK 50, of this DKK 50, around DKK 7 of those are smolt cost, so 1/3, because the utilization of capacity is low. Of course, with the low volume at the moment, as volumes are coming up, the remaining DKK 14, the 2/3, will also be reduced significantly when volumes are increasing.
We are seeing path to better operations in Scotland. Next year, we will slightly increase our volume, but the main thing is that we want to do it safely and move to internal smolt only. One slide more on Scotland, one extra. This illustrates the structural transition now taking place in our Scottish farming operation. Our objective is to replace smaller and externally sourced smolt with larger internal smolt. In 2025, approximately 63% of our smolt transfer were internally produced. During the first nine months of 2026, this year was approximately 61%.
For 2027, our plan is to reach 100% of internally produced smolt, eliminating the needs for external smolt purchases. In both 2025 and the first nine months of 2026, approximately 26% of the transferred smolt were 200 g or larger. For 2027, our aim is to increase this to 75% of large smolt, above 200 g. This represents a substantial change in the quality and the composition of the future smolt transfers. However, the transition in the sea will take a bit more time.
Our current forecast indicates that the share of biomass originating from large smolt in the sea will increase from approximately 22% in the first quarter of 2027 to around 70% by the fourth quarter of 2028. Over the same period, the proportion of biomass originating from internally produced smolt is expected to increase to 100%. We expect that this should improve survival and growth and reduce the duration of marine production cycles. During shorter cycles, we should see improvement of biology. Okay. That concludes our review of the operational performance.
In the Faroe Islands, we continue to operate from strong biological and operational platform, although costs and performance vary between farming sites. In Scotland, we are progressing with a strong or with a structural change required to improve biological performance and operational efficiency. Let's now look at the outlooks. We see a limited supply growth in front of us. We have, as discussed earlier, we expect global increase by approximately 5% in the third quarter, or we saw around 5% in the third quarter, while volumes supplied to the market increased by almost 7%, including the inventory movements.
Europe was the main driver with growth of approximately 8%. In the fourth quarter of 2026, this quarter where we are now, we expect global harvest to decline by approximately 3% compared with the same quarter last year. In the Americas, harvests are expected to decline by approximately 13%. European production is expected to remain broadly stable with a growth of around 1%. In 2027, we expect very limited global supply growth. European harvest volumes is expected broadly unchanged, and global supply growth is expected at approximately 1% for the year, with somewhat higher growth in the Americas.
This represents a significant change from a very strong supply growth experienced in 2025 and most of 2026. Demand has remained resilient despite the significant increase in available volumes. We therefore expect a more balanced supply environment going forward, although actual prices will depend on demand, development, inventory movements, and market conditions. As we saw on some of the pictures, salmon is at the moment one of the cheapest alternatives in the protein market. That's a bit uncommon. When we look at our own numbers, we maintain our guidance for 2026 at 117,000 ton. Faroes could deliver more.
We will see how it goes by the end of the year, but we remain the number in our guidance of 97,000 ton and 20,000 ton for Scotland. For 2027, next year, we increase to 125,000 ton. We maintain 97,000 ton for Faroe Islands. Despite that, as you know, we have increased our stocking, so we should have a stronger base. In Scotland, we lift our guidance to 28,000 ton. We have also a stronger base to achieve this in Scotland with the increased number of smolt that we have transferred this year. The planned increase for the group harvest will, therefore, as you see, mainly come from Scotland. Our quarterly plan indicates stronger volumes, especially from the second half of 2027, particularly in Scotland.
On the smolt transfer, we expect to increase from 30.7 million to 32.5 million, so 1.8 million up from this year. In the Faroe Islands, the plan is to increase from 20.7 million- 21 million. In Scotland, from 10 million- 11.5 million. When we look at fishmeal, oil, and feed, we expect higher production volumes of fishmeal and oil compared with 2026. The blue whiting quota was reduced in 2026, which limited raw material availability for Havsbrún. However, the coastal states have now agreed on a total blue whiting quota of approximately 1,064,000 tons for 2027, which is an increase of 25%.
This is encouraging for Havsbrún and should improve raw material availability, providing catches and landings as we expect. We expect feed production to increase from 175,000 tons this year to 185,000 next year. On the contract side, we intend to enter into sales contracts covering approximately 15%-25% of our expected harvest volumes. We are going to make a bit more contracts again. Our priorities remain sustainable production growth, improved biological performance, and efficient utilization of our integrated value chain.
So slide, just to remind you on our graph from the Capital Markets Day, which we have updated just with the new numbers for next year, DKK 5 billion investments over five years is included maintenance investments. This is intended to support our sustainable growth with improving efficiency and reducing biological risk. We invest in the Faroe Islands to increase freshwater capacity, and our Skálavík is ramping up, being finished built next year. In Scotland, main priorities is the utilization of existing infrastructure, but we need also some development of farming sites and also slightly better processing site capacity, especially harvest.
We still expect to reach our 162,000 ton target by 2030, whereof 112,000 ton is planned for Faroes and 50,000 ton in Scotland. Still, we are focusing very much on cost discipline. We have special programs to reduce costs and target cost reduction. This will be a high priority now for the time going forward. Also when we come to capital expenditures, some of the investments have been postponed slightly, but we still expect to reach our targets. The investment plan indicates a reduction from approximately NOK 8.6/kg in CapEx to around NOK 5.5/kg in 2030.
Our main focus remains disciplined capital allocation, ensuring that investments support biological performance, operating efficiency, and long-term shareholder value. This concludes our operational review and outlook. We have included additional information in the appendix covering our segment results, biological performance, market development, investment plans, and as Høgni mentioned, some insight into our eliminations. Thank you for your attention. Now we are happy to take your questions.
Hi, Alex Aukner from DNB Carnegie. Could you talk a little bit about the lost certification on blue whiting, how that is going to impact you in 2027? You also state that you plan to sell more external volumes in 2027. This year volumes are down 40%, next year it will be up 25%, but that is still down 25% versus 2025 level. Help us connect the dots there, please.
Well, as we talked a bit about also on the last quarterly presentation, we are in an unprecedented situation when it comes to marine ingredients and especially the price situation. We need to take this into consideration. We still want to be mainly focused on marine ingredients in the Faroe Islands. We still want to be known as a high-quality salmon producer with local raw materials. We think that our value chain gives us a special advantage in this area where we have access to raw materials, both from fisheries, but also on off-cuts from pelagic operations.
We want to continue with our ASC-certified salmon, which is the highest certification that we can have. All our operations in the Faroe Islands, 100% are ASC certified. 100% is ASC certified also in Scotland, and also our feed mill is ASC certified. We want to remain with all of this. At the same time, we need to have flexibility, so we already have amended some recipes in the feed, but we are committed to a high proportion of marine ingredients.
That is the short answer. When it comes to the blue whiting quota, the blue whiting quota, as I mentioned, is 25% up, which should give us a very good position to source more marine raw material next year to Havsbrún. We are, as said, committed to the certification. We believe that we will manage this with our flexibility, because also, as I said, we have more or less a full mountain of fishmeal. Was there another question also, Alexander, which I did not answer?
No, I think.
Okay.
Henrik Knutsen, Pareto Securities. Could you give some color on cost in the Faroe Islands going into Q4?
I knew you had some extra question. Well, the costs have gone slightly up. The fourth quarter, do you have a better answer on fourth quarter than me?
I think the sharpest increase is what we have seen.
The sharpest increase is what we have seen. Yeah. Yeah. I guess that's a good answer.
Well, okay. Second, could you elaborate a bit further on the sales and other segment, why it is down as much as it is quarter-over-quarter?
Yeah, I mentioned, I gave you some insights to the numbers, on the cost side especially. I also mentioned Árnafjørður , which also had some weak performance. Our strong side in Bakkafrost is not selling small fish. Our strong side is to sell large fish. Árnafjørður was emptied in the third quarter. I think we will see better margins going forward, and better also premiums. So, yeah.
Thank you.
Christian Nordby, Arctic Securities. We see that you sold a lot more to the U.S. this quarter, from 24%- 33%. I guess because you got no tariffs from the Faroe Islands to the U.S., but we don't really see it impacting your profitability. Is that right, or is it something we don't see in the numbers?
Well, I think that especially during the first two months in the quarter, there was a very big pressure on the prices. I think that's been coming slightly up by the end of the quarter.
Okay, but the tariffs were cut in July, weren't they? Do you see an improvement today based on that, or not really?
We see a stronger market in the U.S. in general. There is a very high demand in the U.S., and I think that will be positive going forward.
Okay, thank you.
Herman Dahl, Nordea. On the feed side, could you say something about the very strong results there? How much is raw material or inventory tailwinds, and what is other effects, and how should we think about that for the coming quarters?
Well, as I mentioned, the sourcing in the quarter was very low. Was it 9,000 ton or something? One digit at least. And still, our sales of feed was more or less flat from last year. So, a lot of the raw materials were from inventories which were produced earlier in the year. So, that reflects that the raw material price changes are the biggest driver for this.
Thanks.
Okay. Thank you very much.