Good morning, and welcome everyone to the presentation of the first quarter for Nordic Aqua. With us to present today, we have myself, I will start, CEO Ragnar Joensen. I'm calling in from the Faroe Islands. And then from Oslo, we have our new CFO Tom Johan Austrheim. And from China, our new Managing Director Andreas Thorud. So the agenda for today, we are going to give you some highlights. We will give an overview on the biology, the project, and then Andreas will come in and say something about the market. We will go through the financials, and I will end with the outlook and summary.
First to the highlights, but this is a very special moment also for us in the company, because last month, we came to a point that we all have been waiting for three years, and that was the first commercial harvest of fish. A big celebration for that inside of the company since this moment we have been waiting for since we started more than three years ago. Anyways, I will go through the highlights. We have had a good operational and biological performance, showing an overview of all batches. We have very good fish health and welfare, and there are still no signs of maturation.
The biomass production, a little over 1,000 tons, no, a little under 1,000 tons since for the quarter, and now we're just over 2,000 tons by the end of the quarter. In stage two, we have initiated and hatchery is finalized. Start feeding is nearly finalized, and we are continuing also with the other departments of stage two. As you'll see, we are strengthening commercial operational competence. We have liquidity of around EUR 28 million by the end of the quarter, and as I mentioned, the big milestone, first commercial harvest and sales during April. So first to the new recruitments.
First of April, we started with our new managing director in China, Andreas Thorud started, and first of May, Tom Austrheim started as the CFO. We have also recruited a sustainability director in Anna Holden Peters. She has been working with us as a consultant before, and now she has joined the company. Ove Nodland, who was the founder of the company, he has switched roles now. He's entered as a board member, and we also have a new board member in Marit Solberg. And Marit Solberg, who's very known in the industry, fish farming. She has been having top leading roles in Mowi for many years.
Then we will go to the biology part. First, just a brief description of how we are producing. The first batch of eggs came into the facility in March 2022, so just over two years ago. Then every three months, we have had new batches entering the facility. So the number of batches that we have inside now is nine, and we have started to harvest on batch number one. All the facility is in use. We have fish in all departments. If we look at the biology, we have started to harvest on batch number 1, and here you can see an overview of the other batches, batch two, three, four, and five.
The yellow or orange line is the budgeted line, and then the white line is how we are actually performing. As you can see, the white line is over the yellow line or orange line in all batches. So fish have grown somewhat better than expected. And you cannot see that on the graphs, but the mortality has been very low. We have measured mortality from fish are entering 150 gram and onwards. In batch number one, we have had around 2% of mortality, and for the other batches, the mortality, accumulated mortality in numbers, has been below 1.2, or 0.9, and so on.
So and for the biology, everything is going according to plan. And then if we go into the project itself, here's a picture of how our facility looks like now or just a few weeks ago. So the building is finished, and we are working on the greenery. Some of the greenery is finalized already, but we are just about to complete it now. For the processing facility, the processing plant was completed in April, and that's also when we started the first harvest. The initial capacity is around 8,000 tons per year, and when we do some minor adjustments, we can increase the capacity in this processing plant up to 20,000 tons.
So we have a processing plant for what we call stage one, two, and three. If we go to the next stage that we initiated late last year, the hatchery is completed. Start feeding is also completed now. As you can see from the picture on the bottom, there's a big activity next to what we call stage one, where we are doing a lot of piling work, preparing for the construction of the building. We will lay in the first eggs in Q3 this year for stage two. Here's just an overview again of what we are building, and as you can see in the blue, blue is stage one, that is completed.
Dark gray, that is what we have started on constructing now. That will take the production up to 8,000 tons. Then, later this year, we will make a timeline also for when to start with stage three, that could take the production up to 20,000 tons. Here is the plan. As I said, stage one, completed. Stage two, construction has started, and we expect the first harvest to be in Q3 2026. Stage three, we have an optional start next year in Q2. And then the first harvest could be by the end of 2027. But of course, as I said, the final decision on timing of stage three will be.
We will come back to that later this year. So, now I will give the word to Andreas, who will take us through market. Please, Andreas.
Thank you for that, Ragnar. As introduced, I am the new managing director for Nordic Aqua Ningbo. I joined the company a little bit more than a month ago, and it's been joining in a very exciting time for the company, given that, as Ragnar just described, we've reached a very significant milestone of the first commercial harvest that was done in April. My background has been to work, live in China for approximately 18 years. Prior to this job, I was the country director for the Norwegian Seafood Council for almost three years.
Prior to this position, I was 10 years at Aker BioMarine, the world-leading krill harvesting company, managing the Chinese market, as well as some other Asian markets. Now, I'm obviously very excited and happy to be part of Nordic Aqua, basically be at the cutting-edge forefront of Atlantic farming, not only in China, but also on a global scale, and lead the China operations of China's at least first ever scaled up commercially RAS facilities. I believe the Chinese market has lots of potential for growth. Although salmon has been imported into the local market here for around 30 years, in some ways, the market is just getting started.
By that, I mean, there is a high awareness of salmon among Chinese consumers, but there's still lots of room for higher penetration. So hence, China being the largest seafood market in the world, and perhaps also one of the most exciting growth markets when it comes to seafood and also be it Atlantic salmon, it is a very exciting times and exciting tasks ahead of us. To look at a little bit of a look back and looking at some numbers on what is the Chinese market today when it comes to imports of fresh Atlantic salmon, HOG.
We saw that, leading up to 2019, there was a growth in the market. We saw that the pandemic struck and came in, in 2020, and it has deeply impacted the local market when it comes to local restrictions that came along with COVID-19 policies in China, as well as there were stringent temporary regulatory and import procedures that complicated getting product to the Chinese market, also distributing it. What was encouraging was that once China, at the end of 2022, went out of their COVID-19 restriction regime and opened up the society, and the growth in the Chinese market in 2023 was sort of back on track.
And it had, for the whole year, last year in whole fresh Atlantic salmon, around 80,000 metric tons, and then surpassing the 2019 levels. This tone that was set in 2023, being a record year, was then transferred into 2024, if you will, with a record quarter of imported Atlantic salmon into the market of around 22,500 metric tons. That is 16.5% year-on-year growth when it comes to import volume to the Chinese market, and it's never, never been that high. If you look at the Chinese market itself, it's quite a fascinating market for Atlantic salmon, and it has some unique features that we do not see necessarily in other neighboring Asian markets.
One of them would be that it's the variety of country of origins trying to grow and increase their market share in this local market. Norway has for many years been a dominant leader, a market leader, but you also have Chilean salmon here. You have Australian salmon. You have Faroe Islands salmon. You have some Scottish, you even have some Canadian, Icelandic salmon. So, compared to other Asian markets where maybe Norwegian salmon or fresh whole or fresh Atlantic salmon will be 85%, 90%, even higher, in the local Chinese market is a different dynamic.
What we witnessed, especially here when we look at the Q1s, since 2021, is that the Norwegian market share has gone down. I think what we saw during the Corona years were that Norway had the strong capacity to deliver in challenging times into the Chinese market, and that was appreciated by the market and become a preferred country of origin. But we also see that now, once we are out of this Corona situation for more than a year, that the market is coming a bit back to the market share that we saw before Corona.
Meaning that the Norwegian has gone down 10%, 10 percentage points, since the quarter last year, while Chile has come back again. We also know that Chile has a longer distance to fly fresh Atlantic salmon to the Chinese market, and also that Australia remains a dominant player, while also the Faroe Islands had a strong performance year-on-year in terms of import volumes. If you look at pricing and what this import prices particularly, we try to illustrate a little bit the dynamic of the Chinese market when it comes to, shall we call it, more European origins, meaning mainly Norwegian, and you have Faroe Islands and Scottish.
And then on the other hand, you have Australian and Chilean. Now, why do we make that distinction? We see that China is mainly traditionally been a market where with a big size preference, a 6+ kilo preference, or sometimes five to six as well. These, these kind of volumes go to a, to one distribution channel, which is usually more for food service and, and Japanese, restaurants, but there is a dynamic in that distribution channel. The other country origins, such as Chile and Australia, has traditionally delivered more of a four to five kilo fish into the market.
But on top of that, they have also enjoyed free trade agreements with China. So they have 0 import duties on all of their salmon, on the Atlantic salmon coming into the Chinese market. While as countries like Norway, Faroe Islands, Scotland, have to pay a 7% import duties. These, these prices we see are here are, including, that. In addition, we see that year-on-year, from Q1 last year and Q1 this year, there is an average decrease in pricing of around 16%, although the volume has gone up.
So this is important to keep in mind when we look at the Chinese market, there is a variety of country origins, and there's also exist different pricing mechanisms, depending on what kind of market or distribution channel you are targeting in the local market. But now we are here, and I'm very pleased and proud of what has been done by this team over these years and actually being able to, as Ragnar pointed out, achieve this historical milestone in last month with the commercial harvest. And right now, the production is scaling up.
It's going increasing now through May, and it will be at full scale towards end of June. We also, as communicated to market last Friday, have processed 92 metric tons that have been sold to the local market, as well as with good and strong performance when it comes to delivering quality, be it here, for instance, a superior rate of 99%, and we also have an average rate of approximately 6.1 kilos live weight for that, which we are very proud of. This leads us to having a foundation to establishing ourselves in the local market as a premium player.
We have four areas of unique selling points and unique positioning opportunities that we see can constitute a compelling value proposition. First of all, we have unparalleled freshness, given our proximity to the larger Shanghai area within five hours, and to the rest of China, approximately in 24 hours. We have a very strong safety profile on our salmon. We do, we farm it in a controlled environment. We do not use any antibiotics, medicines, or have issues with parasites and those sorts of things. So we have a strong safety profile, which we know is important for the local market.
Thirdly, sustainability is a key aspect for us. We believe sustainability is going to increase even more in China in terms of importance. We also know that the general trend of being able to show a local consumer that we take these matters seriously, that we have in China, for China approach in terms of delivering a high quality Atlantic salmon, is something that will resonate throughout the distribution channels. And fourthly, we have flexibility, being agile in terms of delivering fresh Atlantic salmon to the local market throughout the year.
So we have a great predictability. We can give our customers a great predictability in terms of how we can deliver and supply our supply throughout the year. And that constitutes some of the key pillars we have behind our Nordic Pure Atlantic, to which we are focusing now, as communicated, with a selected set of partners to get distribution into channels such as retail and online in China, which we believe will increase, as well as position our product into food service, which is a more traditional channel to which salmon is being consumed in the Chinese market.
So we are very excited to drive those three distribution channels forward with what we can offer as a unique product into the market. But we need also to invest to make that happens, and we have a stated goal of being a taking a premium position. And this is just to illustrate some of the activities we are doing in that regard. We are conducting chef engagements. We have done tasting panels with high-end chefs in Shanghai to measure our performance with regards to freshness, quality, condition factor, taste, and so on, also doing blind tests.
These are giving us a lot of encouraging feedback of a very high quality that has been appreciated by the market. So we are using this to further educate and promote other products towards food service and also get the chef recognition. Secondly, we are doing market activities, marketing activities towards more end users, to also show the market how we feel this, and we have a belief in how we can position this market, given that we are in China producing an Atlantic salmon, which has not been seen in the local market before in terms of freshness, in preference of, in terms of being able to deliver, and how we can position that in the local market.
So we are conducting consumer, or should I say, toward end-user type of activities. T hirdly, we have done PR events, which have been well-received in the local market, especially even with national media, and also local media, which raises our profile of being a player and a company that is set out to deliver a high-quality product to the local market, and to which we think what we have seen, it's getting a good feedback. And given the whole set of our superior rate of 99%, our ability to deliver, we think this lays a foundation for a good premium product position in China. Thank you.
Thank you so much, Andreas. And we will continue with going through the financials, and that is with our new CFO, Tom Austrheim. Please, Tom.
Thank you, Ragnar, and good morning, everyone. Yeah, my name is Tom Austrheim. I started with Nordic Aqua at the beginning of this month. My background is a CFO for several companies within the maritime industry, and I can echo Andreas's excitement to join Nordic Aqua now at this really pivotal stage of the company. Looking at some financials and the highlights for Q1. The financial performance has been in line with the plans. The biomass is just over 2,000 tons at the end of the quarter, with a value of EUR 16.4 million, including fair value adjustments
Looking at the CapEx for stage one and dividing that into three categories, for the farming technology, EUR 52.1 million of the EUR 53 million has been incurred at the end of the quarter. There will be leasehold improvements of EUR 3.5 million, and for the processing plant, EUR 1.9 million of the EUR 4.5 million has been incurred. For stage two, the farming technology is projected at EUR 63 million, whereof EUR 7.4 million has been incurred as of Q1. Looking at the profit and loss and keeping in mind that the commercial harvest was in Q2 April, started in Q2, there is no revenue.
The increase in the purchase of goods and operating expenses is driven by increased production. So the operating EBIT is close to -EUR 2.1 million. The P&L effect of the fair value adjustments, positive EUR 2.4 million for an EBIT of EUR 351 thousand. The financial expenses comprise interest expense, interest income, and currency gains at a net cost of EUR 374 thousand, giving a loss for the period at EUR 23 thousand. So looking at the balance sheet, the financial position at 31st of March showing total assets of EUR 113 million.
The increase in the total assets is mainly from investments in property, plant, and equipment and biomass. You see a recognition of the right of use assets, land, and building, of EUR 18.6 million, as the facility has been handed over during the quarter. The biomass, EUR 16.4 million, as mentioned, including value adjustments of EUR 4.3 million, representing the 2,046 tons. Cash and cash equivalents, EUR 13.2 million. Equity, EUR 73.5 million, approximately 65%. And the non-current liabilities comprise both leasing obligations and debt finance.
So looking at the cash flow, and again reflecting the zero income for this particular quarter for the last time, the net cash flow for the quarter was EUR 10.2 million. The ending cash, EUR 13 million, and including undrawn credit facilities at EUR 28 million. Looking at the CapEx and the production cost breakdown, some of you might have seen this table before. Three columns, stage one in the 2024 column, stage one and two combined, and one, two, and three to the far right. The numbers are in EUR per kilo head on gutted.
And you see the CapEx for the RAS at 13.3, leasing 4.8. The farming cost, five point four, and adding the harvesting up to 5.8. Ninety cent for the general and admin for an EBIT cost of 6.7. Then adding some front-loaded company expansion costs of 0.8, for a full EBIT of 7.5 EUR. I won't go through the numbers for the rest of the columns, but you see that decreasing from the 7.5 EUR down to 6.7 EUR when stage two is in production, and down to 5.5 EUR when all three stages are in production, obviously, at the back of economies of scale. All right. Yeah. So thank you.
Thank you very much, Tom. Then we will just conclude with the summary and some outlook. So, what we presented was that we have had very good biological performance and excellent fish health. We have produced nearly 1,000 tons of biomass, so the total biomass has now just exceeded 2,000 tons. We have started on stage two, and stage three is still in planning. We have strengthened the competence within the company, and we also mentioned that we have had the first harvest and sales in April. And the guiding for Q2 is that we expect to harvest between 500 and 600 tons during Q2.
For the year, the guiding is still at 3,400 tons. And then I'll just remind everyone that we will have a capital market day in China at Gaotang Island on September third this year, and of course, everyone is welcome to join us. Thank you very much. And then we are ready to go to question. And as you understand, it is possible to write down question in the program that you're joining at. And so far, there are no questions that have arrived. We can wait a minute or so if anyone wants to raise a question. Okay, then we will just complete the presentation with this. Thank you so much for joining.