Welcome to the Mowi ASA Third Quarter 2019 Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Kim Døsvig. Please go ahead, sir.
Yes, thank you, welcome to the third quarter conference call for Mowi. We announced our quarterly earnings this morning. The webcast is available online. The purpose of this call is to go through the presentation and open up for questions in the end. Going on to page three, highlights. Q3 operational EBIT of NOK 148 million in the quarter. Record high turnover on all-time high volumes in all business areas: feed, farming, and also consumer products. On the back of increased supply by 13% year-over-year, prices declined in the quarter.
We had positive contributions from our contracts, hence the price achievement was above 100% in the quarter. Mentioning the 13% supply increase, if we look at the value of salmon consumed, we see that demand continues to develop good with a 5% growth year-over-year. Farming costs increased in the quarter, driven by biological incidents.
The Scottish feed plant opened successfully. That's in commissioning phase at the moment. We completed the acquisition of K. Strømmen in Norway. They had four licenses in Region Mid, so that was a good addition. The board resolved to pay a dividend of NOK 2.6 per share, which is payable now in the fourth quarter. Page four, key financials. Some of the highlights were more than NOK 1 billion in operational revenue in the quarter, up 3% year-over-year. Operational EBIT declined on the back of reduced prices. Underlying EPS of EUR 0.2 in the quarter.
Net cash flow per share of NOK 0.15, and harvest volumes of 117,000 tons, which is a 6% increase year-over-year. That's a record high volumes for Mowi. Page five, salmon prices declined in the quarter. We have the table in the report and also further back in the presentation with all the percentages. So far in October, because of so far, less supply coming into the market, we have seen somewhat of a price recovery.
Page six. Price achievement was above 100% in all markets where we have a contract share above 0%. You see we have contracts of 34% in Norway, 41% in Scotland, and 33% in Chile. All of those contracts were contributing positively to our price mix in comparison to the spot price. Page seven, operational EBIT bridge.
As we see the farming division, their results was EUR 61 million lower year-over-year, mainly caused by a reduction in price, about three quarters, and about one quarter increase in cost in terms of the deviation year-over-year, but some positive volume effects.
Going into the regions, page eight, Norway. We see that the operational EBIT was NOK 104 million in the quarter on harvest volumes of 63,000 tonnes, slightly down year-over-year. Operational EBIT of NOK 1.6, which is also a reduction year-over-year. The price achievement was good because of the contract sales.
Some comments on the various regions. Region South harvested very low volumes at only 5,000 tonnes, and one site was harvested out early, which meant that the cost for Region South in the quarter was high. We've had good production in sea during the quarter, and we are expecting a sharp volume recovery in the fourth quarter.
In Region Mid, it was a challenging quarter with harvesting smaller-sized fish and some lice harvesting towards the end of the quarter. Sea lice level is a concern, it has improved going into the fourth quarter. Region North, we've had stable and good performance.
Our contracts on page nine. We see that the contracting volumes are more or less the same year-over-year, both in Q4 2019 and also in Q1 2020. The regions I mentioned, I will not repeat. Going on to Scotland on page 11. We see that the contributions have been mostly positive, driven by increased harvesting. We have doubled the harvest volumes year-over-year. However, prices have also declined in the Scottish entity. We've had algae blooms and some fish health issues towards our end quarter, which has impacted the cost performance.
We expect costs to increase in Q4 due to lower harvesting volumes and a continuation of the challenging biological conditions. Results in Canada were close to zero in the quarter. Results were impacted by reduced prices and challenging environmental conditions in the quarter.
We've had a mortality incident on the East Coast, which we reported to the market some weeks ago. We lost 2.6 million fish on the East Coast due to low oxygen levels driven by high seawater temperatures. We had to recognize a loss of EUR 4.6 million in the quarter related to the mortality. We are currently in discussions with the authorities to rectify or to find a good solution for the temporary suspension of 10 licenses on the East Coast. Having said that, costs are expected to remain high for the Canadian entity in the fourth quarter.
In Chile, we have stable results and a good price achievement in the quarter. We harvested more or less the same volumes, 14,000 tons. The reduced spot prices were more or less offset by good contributions from the contracts.
We see that sea lice levels are higher in Chile in the third quarter compared to last year. It has declined slightly towards the end of the quarter. We are working on generally finding or improving our capacity for treating sea lice, both in the short term but also in the long term. Costs are expected to increase in the fourth quarter as we harvest from sites with a higher cost level. Ireland and Faroes on page 14.
Reduced results from Mowi Ireland on higher costs due to biological challenges. We expect that costs will go up further in the fourth quarter as volumes are reduced. Mowi Faroes, they had a good price achievement but were also impacted by reduced prices. Moving on to consumer products on page 15. This was a quarter where we had record high sold volumes.
We see that consumption rates in all of the key markets, France, Germany, U.K., but also in Spain and Italy, have been very good. Volumes in the Americas has increased significantly through our processing plants. We are seeing that margins in the European VAP segment is strong. There's strong competition in Europe. The 2.1% EBIT margin in the quarter, and that's including all the bulk sales as well. If you exclude the bulk sales, the margin was in fact 3.1%.
Many retailers have initiated promotional campaigns in various countries during the quarter, and this should also support the demand going forward. Feed. Because we opened up a new feed plant, or the Scottish feed plant is undergoing commissioning in the quarter. On the back of that, we recorded record high volumes produced and sold for the feed business area.
The Scottish feed plant is in the commissioning phase. We included a picture here on the right-hand side. The official opening of the pier took place on the August 28th. Mowi Feed had a good quarter, good operations, and a 7% EBIT margin. Now we are approaching self-sufficiency in our feed requirements in Europe for next year. Moving on to the financial section on page 18, profit and loss. As I mentioned, more than NOK 1 billion in revenue for the quarter. Negative fair value adjustment of NOK 215 million because of reduced prices.
This is mark-to-market valuation of our biomass in sea, for the most part. We have income from associated companies of NOK 12.7 million. This is Nova Sea. They delivered an EBIT of NOK 2.13 per kilo in the quarter on 17,500 tonnes. Another good quarter for Nova Sea.
I've mentioned already some of the other key figures. 17% return on capital employed in the quarter. Year-to-date, 20%. Moving on to the financial position on page 19. Our total assets have increased by some NOK 700 million year-over-year, driven by the leases IFRS 16, the acquisition of the four licenses in Region Mid, CapEx, and also increased the biomass in sea. We have 12,000 tonnes of more biomass in sea, which is also driving our inventory levels higher.
The equity ratio of 53%, so it's good. The cash flow on the next page. Starting net interest-bearing debt of NOK 1.1 billion and then ending net interest-bearing debt of NOK 1.23 billion. This is more or less as guided. The working capital, we're tying more capital as we're growing our biomass in sea. CapEx is slightly lower than guided.
There's some potential delays on some projects which might impact the full year guidance, although we have kept it unchanged for now. Moving on to page 21, cash flow guidance. Working capital is unchanged. The CapEx I mentioned, potentially some delays, hence there's some risk that that number might be lower. The other items are unchanged. The financing on page 22 is the same. Bank financing, secured bond financing, the unsecured Schuldschein loan, and our long-term net debt target is unchanged at NOK 1.4 billion.
On the market side, on supply, as already mentioned, supply was significantly higher than the guided range of 3%-7%. Supply ended up at 13% in the quarter. More supply out of all of the key regions, Norway, Scotland and also Chile. The Norwegian supply was higher because growth in sea was very good.
It's been a good growth conditions in fact for Norway throughout the year with warmer winter temperatures, and in fact lower summer temperatures in sea. The growth conditions have been good. Feed sales have been high, and consequently harvesting has also been high. The increased harvesting was driven by both good growth, but also because of sea lice pressure. We see that in some areas, the harvest rates were low. It was a combination of both of those two factors.
The same in Scotland, more growth than guided because of increased growth in sea, but also some sea lice problems towards the end, which forced some farmers to harvest the fish early. Chile also harvested more than guided. This of course put pressure on salmon prices, and we see that on the next page, on page 24.
On the following page, we see that the market has consumed more or less the same in percentage terms. 13% higher consumption rates year-over-year, which is on par with the supply increase. Notwithstanding the lower spot prices, we see that contract prices have contributed positively. Hence the demand growth in the quarter measured in euro terms has increased by approximately 5%, according to our estimates. Good demand continues globally. In fact, in all of the key European markets have grown double digits. France, Germany, U.K. and Spain in the quarter.
U.S. grew by some 12% in the quarter. China 12%, and Asia 14%. A good development. Asia is growing and China in particular, once they have access to the right sizes. Asia is generally a big fish market, and we had access to big fish in the third quarter.
Okay, moving on to page 26. The supply outlook for Q4 is 0%-5%. For 2020, the midpoint is 3%-4% globally. This is typically supportive for prices. Supply has been high in Q3, and we expect the supply growth to come down, but still to remain positive going forward. These supply figures are also supported by the biomass figures we see.
Over to our own volume guidance in Mowi. We are maintaining 430,000 tons in the quarter. Next year, in 2020, we are projecting to grow to 450,000 tons. To grow by some 20,000 tons. In 2019, we recover from 375 tons, so growth of 55,000 tons, which is a recovery year for us, and then we continue to improve in 2020.
In Norway, we have good growth, some growth in Scotland, a reduction in Canada because of East Canada, mainly. In Chile, it's more or less the same, and that's the same in Ireland and Faroes. The outlook. Sector fundamentals remain strong on good demand. We have seen good demand response in all of the key markets, as I mentioned. We also gain more confidence as the retailers are running more promotions now than what they did previously. Significant harvest volumes we've had in Q3 has reduced the potential growth going forward to more in this mid-single-digit growth range.
The forward price remains at NOK 5.8, which is good. The record-high third quarter biomass from Mowi supports the volume guidance we published this morning. We have about, as I mentioned, 12,000 tonnes more of biomass in sea compared to the same quarter last year.
The feed plant is finalizing commissioning. The dividend payment in the fourth quarter will be NOK 2.6 per share. That concludes the Q3 presentation. Operator, if there's any questions, please address those. Thank you.
Thank you. If you would like to ask a question, please signal by pressing star one on your telephone keypad. If you're using a speakerphone, please make sure your mute function is turned off to allow your signal to reach our equipment. Again, press star one to ask a question. We'll pause for just a moment to allow everyone an opportunity to signal for questions. Once again, if you'd like to ask a question, you can signal by pressing star one. There are no questions over the audio at this time.
Okay. Well, in that case, I think this concludes the third quarter results. We're looking forward to seeing many of you on the road in the coming days. Thanks for participating.
This concludes today's call. Thank you for your participation. You may now disconnect.