Highlights in Q2 2021 was, we reached a higher EBIT than in previous quarter, around NOK 13.2. 2019 generation is giving good results and good cost and quality. We harvested 1,090 tons compared to 340 tons the previous year. Our super-hot post-smolt station in Kópasker started the operation in July. We are extremely proud of seeing the smolt swimming in the new tanks. You can see on the right side the picture of the station that was just about to be closed of the house. We have plans that we can deliver smolts out of Kópasker in Q3. That will be big and strong for the winter. The Icelandic Competition Authority approved Mossi ehf. as a new major owner in Ice Fish Farm.
We are exploring now strategic opportunities between Ice Fish Farm and Laxar, which Mossi ehf. is also majority owner in, for the companies to go forward. We had license update of Stöðvarfjörður of application of 7,000 ton. They approved our environmental report, the Planning Agency. We expect to have the license in Q3. Seyðisfjörður 10,000 ton license is following in Q4 2021. The environmental report is finished and being gone through in the Planning Agency. This is on track compared what we announced in previous quarter. Hopefully we will have success and get the licenses and be able to use them next spring. The license update for Berufjörður was also approved. Now we have four farming areas instead of three enables better utilization of the licenses. Big moments upwards on the land-based farming for our smolt. As you see, the 400 ton license for Kópasker.
We have an application for up to 2,700 tons that can be used for phase II in Kópasker. We got increased license in Ístorf our smolt station in Súðavík. That was previously 1,600 tons, now we're moving up to 1,800 tons. This is in line with the strategy in Ístorf to grow bigger smolts and have them go to the sea bigger and also from Kópasker so we can increase the production in sea in shorten period. Iceland in total, just a quick summary. We are located around Iceland, headquarters in Reykjavík and Ístorf smolt station close to Reykjavík. On the east side, right side, we have the fjords. Up on the north side, we have Reykjahlíð and Kópasker. Iceland in total has a capacity of around 132,000 tons. Eastfjords is approximately half of that.
We also have two fjords in process that should be given capacity numbers. We estimate that's around 20,000 tons. Ístorf in total can reach around 82,000 tons of MAB biomass. This could have even more production. For example, Faroe Islands has shown great results over the years and improved volume are around 81,000 tons. Since we are close to the U.S., you can see on the bottom left that we have now shipping line going straight from Iceland to the U.S. and giving us one third of the cost versus air freight and 95% lower CO₂. Finally, we have some advantage on Norway for transport.
Yes. Good afternoon, everyone. My name is Róbert. I'm the CEO of Ice Fish Farm. I'm going to take a quick overview of the financial performance of the second quarter this year. Here you see the financial summary. Like Guðmundur mentioned, the harvested volume has increased compared to last year. The total harvested amount was 1,090 tons this quarter compared to 340 tons of salmon last year. The EBIT of the group is also going up, and revenue as well. The EBIT per kilo for salmon is decreasing due to lower prices and unfavorable currency involvement. Here you can see the consolidated income statement. The revenues are increasing due to almost tripled harvested volume compared to last year. The cost of materials is similar to last year. It's obviously increasing, but the cost of material per kilo is similar.
Employment benefit expenses is decreasing per kilo in the amount of around 36%. Other expenses are also decreasing per kilo. The depreciation is similar to last year, despite heavy investment in the group. This is due to the fact that most of the investment is in relation to our smolt station in Kópasker, which did not start operation until July this year, so no depreciation is calculated or reported before that period. The fair value adjustment of biomass is amounting to ISK 19.2 million in the first half of this year due to increased harvested salmon or harvested biomass. The EBITDA margin is similar compared to last year, 33% compared to 38%. Yes. If you go over to the balance sheet. Here's the consolidated statement of financial position, balance sheet.
The largest change is in the property and plant equipment on the non-current asset side of the balance sheet. This is due to heavy investment in our super smolt station in Kópasker. The net interest-bearing debt is also affected by this since we have financed this investment with loans. The cash flow statement shows the same story. The investing activities of around NOK 175 million for the first half of 2021, mainly due to our smolt station in Kópasker. Finally, here you can see the expansion plan. Our current expansion plan, which is for the next three years. The total investment according to this plan amounts to around NOK 200 million. We have already invested NOK 175 million this year. The remainder could increase due to the fact that we are not including phase II, III, and IV in the smolt station.
Phase I was finalized in July. II, III, and IV have not been included. Now, Ice Fish Farm has in operation four sites in the sea. Each site has the capacity of 14 cages. We are planning to build two new sites in 2022 and one in 2023. Below, you can see the pictures from our smolt station in Kópasker, which is already producing 4,300,000 smolt for 2022 and currently holding 4.8 million smolts.
That picture with rain on it was taken in May, and the picture below was taken in end of August. It's been a heavy duty work summer for our guys and the people around Kópasker building up our facility. We have a growth plan and premium build-up plan, and we are on track there. Major developments in Ísþór. We got this bigger license, and we are now installing also heat exchangers and a new house over existing tanks for secured stable water flow for the salmon and also better working conditions for people. We're building 2,000 cubic meter tanks that will be ready in Q4. We are expecting from Ísþór around 5 million smolts that Ice Fish Farm AS receives half of, around 2.5 million. Since we have these bigger tanks, we will have bigger smolts for next spring.
Rifós in Kópasker, we've shown you pictures there, and this is a great success. We've already started filling up the house, and it has almost 5 million smolts in production. We will receive some smolts this autumn from Kópasker the first time, as we've been shipping smolts from Rifós down to Kópasker. Current phase I is estimated that we can reach around 4 million smolts out of Kópasker. With further steps going into phase II, we can add on more houses and increase the volume. First house is the most expensive. Second house should be lower cost as we can utilize the service houses and various entities in the construction. In overview, our value chain, there are big improvements. We've gone over the smolt production, we see that for Q2, we will have more fish and bigger. Kópasker is delivering faster than expected.
For salmon farming, Q2 was difficult, not as difficult as Q1. It was certainly colder than normal, therefore the growth was slower. We are seeing now big changes in middle of August or beginning of August. We had excellent weather and sun and a heat wave. It's been up to around 20 to 30 degrees in the East Coast, later part of the summer. This has given good better results in the sea. For example, in our normal production curve, 75% of our production is happening from July, August until December. These are the months that we produce 75% of our volume. That is a good sign that the temperature is up and the cages are loaded with salmon and been spread also quite well.
We have a good low density so the fish can grow faster, and clean nets and having top-notch ability to grow. We have put up two new sites, one in Fossvogur, one Berufjörður. Both sites have strong big cages and new barges that have hybrid solutions to lower their CO₂, and extremely proud of this equipment. They have shown that the better the equipment is, the better production is, and more safe during the winter time. Processing and distribution, we are working on the box factory, and we still expect to have first cases, boxes for the salmon produced in Q1 2022. Processing has been stable and distribution. We have successful shipments direct to USA and saving cost and also lower CO₂.
The product is fantastic, even though it takes a little bit longer period to transport the fish since we have the super cooling equipment and extremely high-quality salmon. Customer, we are working heavily with our sales partners in Seaport and Utgo to get to know more customers and build up the markets both in Asia, USA, and Europe. We are seeing a high interest for our salmon and people want to have test and get to know our beautiful dark salmon. We have first organic salmon coming into the sea this autumn, and also sterile. These will be highly popular products from us as they are unique, being organic from Iceland and also sterile. That means that this is lower risk for wild salmon and potentially more growth and good summer. The license update, gone through that a little bit before.
The major development there is we have been approved this license in Stöðvarfjörður, and so we hope that we get the license quite soon, and also from Seyðisfjörður, the report has been finalized. Otherwise, we are on track on receiving licenses for future growth. Outlook, we see global harvest increased only 1% in the first half of this year, and there is a strong demand from USA. Both retail and HORECA is opening up, and that means that market has been built during this COVID season, that retailers learned to buy fish in the store and cook it at home. The HORECA is also opening up. This is very positive for the market. Majority of the harvest for 2021 is already contracted, and we have a good opportunity globally for premium salmon.
The harvest has been adjusted to the conditions that we have faced in the last six months. Lower growth, and we have been harvesting smaller fish than anticipated. Even though the fish is smaller, we are receiving premium pricing. Now we have relaxed harvest, lower harvest for August and September, as this is the main season for growing, and we can compensate hopefully going forward. We are putting down the outlook as we will get this one and not overestimate. Even for the plans in 2022 and 2023, we have put in a program, colder temperatures. If we see that seasons will be better, we can expect more volume going forward. The cost level is expected to go down with more production. Finance is going well. We have finance and secured loans for our investments, and that allows us to continue our growth plan.
We are in talk with Laxar as strategic possibilities there and synergies that we would gain with controlling the area of Eastfjords. Our mantra, sustainability, responsible farming is always number one. To have a world-class team, we have been grateful of getting new team members on the team, both on land and the land-based facilities and on sea. We've been training them and getting to know more people and building up good morale. Investment in sustainable production, so emphasizes on lowering CO₂ and our certificates and surveillance of the surroundings that we have good facilities to produce. Therefore, we can produce organic and various types of salmon. We are always keeping good eye on what's happening around us.
For example, this year we have ordered new barges for next year that are stronger and more durable in weathers and elements that can be experienced in our fjords. Currently, we have also one concrete barge coming over, which is shown now in Trondheim. You can go and see the new barge. It will be shipped over to Iceland soon after the show, and we can start using it to feed our smolt that is coming in this autumn. This was outlook and our presentation. If you have questions, please fire away.
Here's a question from Terje: Can you elaborate on the strategic discussions with Laxar? What are the main synergies you see, and how will you make sure to protect the interest of the minority shareholders with Mossi ehf. having a seat on both sides of the table?
This is a fantastic opportunity to have a full control of these fjords and many synergies are therefore possible. Even going deeper in planning and organizing and quality systems and making sure we are producing good salmon. In total, both parties will gain on that going forward. To protect the minority and also the majority is responsibility, and that is being worked on, and we see that we have two good companies that can be even better together. It's going to be interesting and a fantastic journey when it goes through, if we reach synergies and possible outcome.
Okay. Here's a question. Let me see. Here we have a question from Audun: Please explain the difference in growth seen between the West Coast farmers and Ice Fish Farm, where the West Coast farmers report good growth in sea while Ice Fish Farm reports lower growth than expected.
Yes, there is a difference on the heat in the sea between Eastfjords and Westfjords. Normal year, we have a higher temperature during winter than Westfjords, and in the summer, they have higher temperature than Eastfjords. On average, this has outcome that it's good growth in winter in the East. This year we had lower temperature than normal, and therefore they were not experiencing good growth during this winter. That explains pretty much the difference on the East and West. That there is normally it's lower temperature in the West during winter and higher in the East.
Audun asks also, what is the expected time in sea for the 300g smolt from Kópasker?
Yeah, we have already delivered from Rifós this year around 600g fish and also 300g fish. We aim to have around 200g fish in Q3 going out. Next year we will have fish up to 600g, down to about 200g, average around 400g.
The expected time in the sea for 300g.
If you have 400g fish going into the sea in June, then it's around 14 months up to about harvesting size. Compared to if you have 100g, then it's four to six months longer period. We are saving four to six months on the bigger smolts. It's even higher on the autumn smolts delivering 3 400g in autumn than that fish. Small size can go up to around 24-26 months, but with the 400g, it's around 18-20 months.
Please quantify the smolt mortality. What is done to reduce the mortality?
Yes. The smolt mortality was higher this year than we expected due to the transport was difficult. It was cold sea, and we suffered higher mortality than expected. With going forward, we can see, for example, in Rifós that we will have a technology there to cool down the smolt before delivery, and therefore opening up a longer period over the year window to put out smolt, and therefore utilize the smolt station better and also the licenses.
What is the current transport cost? You report revenues kilo, but how has the cost of transport evolved over the past quarters, and how do you anticipate the transportation cost will evolve going forward?
Yeah. The transport cost has been going up, especially on the air freight. We've been managing to lower that cost now with using the boat to U.S.A. as majority of our fish is sold in U.S.A. We are selling the salmon in duty paid. Our partner, Seaborn and Ulco, they have control on the cost of transport. We are having the benefits of scale there as they are both huge buyer of transport for salmon in the world selling over 70,000, 80,000 tons a year. We are grateful on that cooperation. In general, transport cost has been going up. For Ice, moving more fish with the container ships to U.S., we are looking at lower cost per kilo.
Karl Emil asks, how will the split in harvest volumes be between Q3 and Q4 as shown in 2021?
Yeah. We have not that number. We will not give that number up. It will depends on how the growth is now. As soon as the fish has reached good size, then we increase the harvest. It can fluctuate between quarter three and quarter four when we harvest fish that we have aim to finish this year.
Okay. Ulf asks, what is the main reason for lowering 2023 production guidance, and what risks do you see for lowering the estimate further?
Yes. The explanation on that is that we have put in our growth model colder year than we had before. I personally don't estimate that we will have a cold year-over-year. For safety concerns and be able to produce more than maybe we are guiding, we have decided to stick to this volume. Therefore, I'm very convinced that we will reach the outlook we are looking at the moment and even outperform that going forward. The growth in the smolt station is going well currently. We can see big benefits out of Kópasker coming for next spring.
Yes. I don't think that there are any more questions. Hoping that I haven't skipped anyone. Here is Patrick. He asks, "How do you expect the remaining production volumes of 6,000 this year to be distributed?" You already answered that. "How do you view implications for sterile license in Iceland and further conversions after recent developments on similar production in Norway?" He refers to the news related to the Norway Royal Salmon licenses.
Yes, the strategy for sterile salmon is that we will have bigger smolts than normal for sterile. Therefore, we are looking at having the sterile salmon only one year in the sea instead of having two winters. Condition in Iceland is different from Norway as we have no sea lice, so handling is not necessary. With our low density strategy, I have a great belief that this will be a success, and the fish can grow well in Icelandic conditions. We are looking closely on all possibilities to make this a success. We will put out the first fish now in the autumn, and we will see going forward. The recent development on the last risk assessment was a good step forward as we gained quite a lot more fertile salmon than we had before. Ice Fish farm doubled the volume of fertile versus sterile.
In about one and a half years, we will have a new risk assessment. With the equipment and the safety and the responsibility farming we are doing with the low escapes and not seeing much of fish that shouldn't be in some places. With time, we gain trust and reliability. That's a key factor here, that we are building up a new salmon region with the latest equipment, the best people, and therefore we can hopefully see more of salmon farming in Iceland. I have also great relief on sterile that, for example, our main customer is looking forward to receive the salmon as this is more environmentally friendly, and we can gain higher prices for this type of salmon.
Terje asks, "What is the likely timeline for the discussions with Laxar?
We have not decided anything on that. We will inform the market if something happens in this process, and we cannot comment on that at the moment.
Martin asks, "How do you plan the smolt release for 2023 harvest, both in number, weight, and timing? Are you keeping some smolt on land over winter?
Yeah, we are of course planning now for 2021 autumn. There's quite a lot of smolt coming out in autumn this year. We are fully stocked Reykjahlíð and Kópasker and Eastfjords for next year. That will continue on to 2023. We'll have a lot of smolt coming in in bigger sizes.
Yes. I don't think there are any more questions. Please, you can also just unmute and ask if I think this is everything here, at least in the meeting chat.
I would say that we are doing our best to produce good salmon, and the whole team in Iceland is motivated and excited for the future and growth. We are benefiting a lot of places in Iceland that don't have many other opportunities, and we are going to do great things. Thank you for staying with us, and hopefully we'll see you again soon. Thank you.
Thank you.