Good morning, and welcome to the fourth quarter presentation of Lerøy Seafood Group . With me today I have Sjur Malm, which will take you through the key financial figures. First of all, I will take you through the highlights and quarter, and then I will go through the outlook for supply and demand. First of all, fourth quarter, a g ood quarter with EBIT before fair value adjustment of NOK 777 million, a harvest volume of 42,000 tons. EBIT all inclusive, exclusive EBIT of Havfisk and Lerøy Seafood of NOK 16.5, a contract share of 30%, a net interest-bearing debt of NOK 2.2 billion, a harvest guidance of 169,000 tons, which is increased by 2,000 tons compared to the guidance that we gave in last presentation. Proposed dividend of NOK 1.5 per share.
As you can see from this graph, we are still increasing the total turnover of the group almost up to NOK 20 billion, NOK 18.6 billion in 2017. If we look at the quarterly historic figures also, we see the last couple of years with a very good total EBIT every quarter and also the same for the EBIT per kilo all inclusive. Last quarter of NOK 16.5. I will go shortly through the different segments, the Farming, the Wild Catch, and VAP and Sales and Distribution before Sjur will take you through the key financial figures. If we look at the Farming highlights, we have seen lower prices this quarter than what we normally have seen the last two years. We see a decrease of 25% in Q4 2017 compared to Q4 2016, and that's down NOK 16.
Compared to third quarter, we see a NOK 7 reduction in price. The trout achievement is below the salmon in this quarter, mainly due to quality downgrade for the trout in this quarter with some maturing of the trout. The contract prices is above the spot prices. The cost is down compared to third quarter, and we see an increase in biomass compared to end of 2016 of 4%. More fish available in the sea. The total biomass end of the year is 112,000 ton. If we look at the Farming volumes, the guidance for 2018, we see a small decrease in Lerøy Aurora down to 38,000 ton. We see an increase of 3,500 ton in Lerøy Midt from 64,500 to 68,000 ton. We see Lerøy Sjøtroll with a large increase from 54,000 ton to 63,000 ton.
Total volume from Norway is up to 169,000 tons from about 158,000 tons in 2016. Norskott Havbruk is a little bit down. Total volume is 26,000 tons in 2018, and our share is 13%, so a total of 182,000 tons. The Wild Catch. The fishery has been good even though it's a little bit down in the fourth quarter compared to 2016, but the total volume in the year is up 5%. The prices for cod is up 7% in this quarter, and the haddock is up 17%, and the skate is down by 14%. We see improvement in Lerøy Seafood Group compared to third quarter, but profitability remains at unsatisfactory level still. We are working a lot to improve the situation on the factory side. VAP and Sales and Distribution, good quarter.
We have a strong position as a fully fledged integrated seafood supplier and are building our downstream activity step by step, close cooperation with strategic customers all over Europe and also in Asia and U.S. We see that this is improving step by step even though that fourth quarter is a little bit lower result than in same quarter in 2016. The whole year we see improved result in this segment. Sjur will come back to that now. Sjur .
Yes. Thank you, Henning. I'll walk us through the key highlights of the financial results for the fourth quarter and for 2017. We are quite pleased with the performance in the fourth quarter. You can see the main drivers on the lateral lines. We've harvested 8% more volume, but the EBIT per kilo is less than last year due to lower salmon prices. In sum, this means that our EBIT is down 24% compared to last year, at NOK 777 million. Associate, same level as last year. This includes our operations in the U.K. as well as our operations now in Denmark as the key contributors. Earnings per share at NOK 1.12 compared to NOK 1.45 last year. I'll get more back to the details, but in sum, it was a fairly good quarter for the group.
Looking at annual numbers, this is the best year for our company ever. We have the highest revenue, highest EBITDA, highest EBIT, highest pre-tax profit, and highest EPS in the group's history, and we are pleased with that. I think it's interesting to note that obviously price is part of the factor. As you can see, our EBIT per kilo is up from NOK 18.30- NOK 21.10. You can also see that volume growth is quite important, explaining the increase in operating result. NOK 3.7 billion in operating result, we are pleased with. Looking to our balance sheet, this now compares with the quarter last year, where our Whitefish acquisition was already consolidated. You can see there are no changes in intangible assets. We have invested a lot in smolt facilities as well as harvesting and processing facilities on red fish.
That's why tangible fixed asset is up. You can see biological asset. Henning has already commented that biological asset is 4% higher than last year. Cost-wise, they're at the same cost point, meaning that the cost per kilo at the fish in sea is less than last year, indicating potential for cost reductions into next year. Inventory is a bit up, and we have more inventory with our acquired whitefish business than we used to have. Receivables lower than last year due to less volume in December and lower price. Good cash position and equity ratio of 56%. Net interest-bearing debt is NOK 2.2 billion, and we are pleased with the cash flow generation of 2017. Just showing this slide to show you that we have a balanced amortization schedule. We are well within our covenants. I think on cash flow, focusing on the year is the most representative.
We have NOK 4.3 billion in EBITDA. We paid tax based on results in 2016. We built some working capital where inventory is part of the picture. We have cash from operating activities of close to NOK 3.7 billion. We have invested NOK 1.5 billion in what already is mentioned, received dividends, particularly from Norskott Havbruk operation in Scotland. We made an acquisition in Denmark, part of the transaction, which is part of the NOK 104 million in change of non-current asset. In sum, we paid a dividend of above NOK 800 million. After NOK 500 million in tax, after NOK 1.5 million in CapEx, after NOK 800 million in dividends, we have still reduced our net interest-bearing debt by NOK 1.2 billion. A very strong cash flow in 2017. Lerøy was listed in 2002. The aim was to have an 18% return on capital employed.
Since then, interest levels have reached a completely different level, but we're still able to be at that level and the average in this time shown here is above 18%. In 2016, 2017, this includes the largest acquisition ever into whitefish, which is not currently generating the return on capital employed at these levels. We hope it will get there. Some comment on the dividend. This slide to the left is showing absolute dividend payments in the blue one. You can see that there is a stability and an increase in dividends. Lerøy has in modern times always paid a dividend, will always pay a dividend. Dividend policy is stayed at 30%-40%, but continuity is also very important. In some downward years, historically, the dividend ratio has been above 100%. This shows development in market cap and development in volumes of salmon, trout, and now also whitefish.
We are with own catch, own harvest, close to 240,000 tons in 2018. Beyond this, we buy significant volumes of third-party fish in Lerøy Norway Seafoods, of whitefish, as well as other producers of salmon and trout and other species. In 2018, Lerøy will sell probably around 350,000 tons of seafood equivalents tons. That makes us the largest seafood exporter out of Norway. We are among the larger in Europe and also in the world. As this slide is starting to show, we are much, much more than just a salmon producer today. This shows segments compared to last year. Key change is profits in farming, which is down due to price. Some comments on different regions. Aurora is, I think, its lowest cost producer of salmon in the world today. If it's not the lowest, at least it's among the lowest. We are very pleased.
We've been able to grow volumes by 10,000 tonnes in 2017. Costs are down in the last two quarters, we expect to continue the industry-leading cost for 2018. We made investments to invest at NOK 230 million in larger smolts and are in a recirculating site of around 2,000 tonnes biomass production. Good performance, strong results, very happy with the operations. Lerøy Midt has seen some challenging years, particularly 2015, 2016. 2017 has been quite the turnaround year in operations. We have long lead times in production, so it takes time to see the results. Gradually, over the last two quarters, there's been a significant fall in release from stock cost. The trend is falling. We expect significantly lower cost into 2018 and production is good. That's also shown in a 12,000 tonnes increase in production compared to last year.
Two good regions and then one region with challenges. This is Hordaland. This is where we have seen challenges for many years also this quarter. We had quite acute challenge in Q3 at some sites that impacted volume Q4, amount of fixed cost Q4, and we're not pleased at all with the results second half in Lerøy Sjøtroll . I think the potential in Hordaland is huge, both when it comes to volumes and when it comes to cost, but we're not still been able to utilize it. We are seeing that larger smolt, that investment where we contain the fish in the early life phase is giving good success stories. We have high expectations for our new smolt facility, which will be finalized first in 2019. We put in the first eggs now in May, and we'll see first release in 2019.
We think that will give us a good improvement in this region. Wild Catch Henning has already touched upon. Havfisk, strong performance, high catch efficiencies, little bit lower volumes than last year. Higher prices but good profitability. The land-based industry, Lerøy Norway Seafoods, is a challenge. It's been a challenge for the previous owner and every owner the last 10 years, and there isn't much fill at the industry in Norway at all on whitefish due to the fact that it's challenging. We're doing everything we can. We're taking significant measures and we believe step by step, this will improve in the coming years. Scottish Sea Farms, our joint venture in the U.K., excellent 2017 with some challenges toward the end of the year with gill health issues at some sites that led to accelerated harvesting, lower average harvest weight, higher cost, and higher volume than in 2017.
This will bring lower volume 2018, down to 26,000 tonnes, and net interest-bearing debt of NOK 181 million in 2017. 2017 was a great year for this operation. Henning has already touched upon value-added processing, sales, and distribution. I think this has been a very important year for Lerøy in this segment. We have truly repositioned the company as an integrated player in whitefish, as well as redfish. We are good, and we believe we are in a unique position to solve many of our key customers and strategic customers their needs. We've taken clear steps with larger strategic customers in 2017, at least in my view, than any year before. The future for this segment is very interesting. We have a unique position, and we look forward to continue to grow that in the future. Outlook, Henning? .
Thank you very much. First of all, we're going to look at the supply side for 2018. What we see now is that the global growth will be around 5%. Norway up to 7.5%, U.K. down 9%, and Chile is up about 5%. This estimate is lower than what we saw in January. This estimate is updated 16th of February. If we look at the quarterly prices, we see that fourth quarter 2017 was at NOK 49. We see that first half of first quarter, we have the NSI pric e achievement of NOK 54.
We see in the spot market, the weekly prices now is improving a lot. This week we see prices between NOK 65 and NOK 70. A strong increase in the prices week- by- week, the last couple of weeks. We now have the period going forward, up against Easter. We also expect that the price level will be above what we have seen so far in the quarter. If we look at the volumes last year, this is the weekly volumes. This is one of the reasons for the price decrease in the end of the year and with the extremely high growth in the month of December 2017. We also see that the trend continued into January, where we also had a huge volume increase, up 21% in Norway. We see 9% in February and 0% growth in March.
We also see that the volume, the first seven months, is very stable, level around 90,000 and 100,000 tons in Norway on a monthly level, which will give about the export volumes out of Norway 20,000 to 23,000 tons on weekly numbers. We see that the second quarter estimates is taken down compared to earlier reports from Kontali. We have expectation that second quarter also, we will see fairly good prices. If we look at Europe, it's a very similar picture. Chile, it's increased the first six, seven months, and then we'll see a flat growth or zero growth in the end of the year. If we look at the worldwide picture, so in total, this is up 5%. The highest growth is behind us, and that was January. The second highest month is February. Yeah.
We are in, already in a couple of days, we are into March. We have taken the highest growth month is. Yeah. That's behind us now. We look at the consumption of Atlantic salmon, we see the total consumption numbers for the year. We see that EU is down at 2%. U.S. is up 4%. Other markets is up 8%. At the high price level, we see that the other markets is the markets that is really driving the demand for salmon. We look at the third quarter, we see then the prices is down. I think in this quarter, we had a price level of about NOK 57. We see when the price comes down, we see that EU is now flat, 0% growth, U.S. up 8%, a nd we see that other markets is increasing by 16%.
If you look at the Q4, where the prices is down to NOK 49, we see that the demand in EU is increasing, up 7%, U.S. up 17%, you see other markets up 19%. You see that the market is really reacting on the lower price levels. We look at the other markets, the largest market in other markets is China, or a combination of China, Hong Kong, and Vietnam. Most of this fish from Vietnam is going into China. We see Brazil is down and we see a lot of other intermediate size markets is increasing a lot. This one is the smaller markets, we also see a very positive growth in all the smaller markets. If you look at fourth quarter, we see a very strong growth in China. We see also a strong growth in Brazil.
Especially Brazil is reacting on lower price level, especially from Chile. The good thing is the situation with China. We also see more and more direct exports from Norway directly into China now. I think in January, we had about 2,500 tons export to China. We see that the volumes is, on a weekly volume, between 400-700 tons, is stabilizing the export to China. This will be positive going forward, and we think that China will be one of the major markets for Atlantic salmon going forward. To summarize, we see we have a positive outlook for both whitefish prices. We also see that the salmon prices will be at a strong level, even though it will be some fluctuations, and at least the first six, seven months, it will be a good price level.
We expect a contract share of 25% in first quarter, and we see a significant potential in the whitefish. 2017 was the first year, and we are improving all steps in the value chain also for the whitefish, and step by step improving this operation going forward. It's been a exciting year with the whitefish, but also a lot of new challenges for us within this area. We are positive on the things going forward. From this quarter, we will also start reporting volumes for both catch volumes and the harvest volume of salmon and trout beginning in the start in the quarter right after each quarter. That's what we had today. Thank you very much.