Good morning, everyone, and welcome to the presentation of SalMar's results for the third quarter of 2026. My name is Frode Arntsen. I am the CEO of SalMar, and together with me today, our CFO, Ulrik Steinvik. It is only 10 weeks ago since we last presented our results at the end of August. Time flies, but a great deal has happened since then. Large volumes have been produced, handled, harvested, transported, and sold to customers around the world. Q3 has indeed been a quarter of record volumes. I would like to extend a big thank to all our employees for their effort during the period. I know that many of you have been working around the clock.
Although we have faced challenges with changes to harvest plans and various situations that needed to be handled, I am simply proud of the work you all do, and proud to lead this fantastic SalMar train as it keeps moving ahead at full steam. Some of what I will take you through today shows just how quickly things can change when working with biology. In fact, the final five weeks of the quarter had quite a significant impact on our results this quarter. Although cost development in Q3 was not quite what we had hoped for, you will see today that a great deal has also gone very well. With the setup we have across our value chain, we are satisfied with how we handled the events towards the end of the quarter.
Today, we are presenting financial results that are significantly improved from last year, driven by higher volume, lower cost, and better price achievement. Today's presentation will follow the same structure as before. I will take you through some highlights as well as the different operating segments before CFO Ulrik walks you through the financial update. To conclude, I will talk about the upgrade of InnovaMar before ending with our volume guidance for 2027. Let us now take a closer look at the third quarter results. In Norway, we harvested 99,900 tonnes at a margin of NOK 16.2/kg . Overall, the Norwegian operations delivered an operational EBIT of NOK 1,620 million. Including Icelandic Salmon and SalMar Ocean, we harvested 105,100 tonnes in the quarter and delivered a result of NOK 1,609 million, corresponding to a margin of NOK 15.3/kg .
Harvest volume in the quarter reached a record high, driven by the strong biological performance we have experienced in 2026. Sales and Industry delivered a very strong result, supported by higher volumes through our facilities, improved operations, and stronger sales performance. Iceland returned to positive results with lower cost driving the improvement. Scottish Sea Farms delivered a significant increase in volume, although results remained weak. At the same time, the cost per kilo of our fish at sea is lower, and we expect a somewhat lower cost level in the fourth quarter. Volume guidance for 2026 is reduced by 3,000 tonnes to 347,000 tonnes due to changes in Iceland and Scotland, while Norway remains unchanged. Looking into 2027, we expect the same volume. I will return to this towards the end of the presentation.
As you have seen, in July, we announced that we had reached an agreement with Heimstø to acquire its 70% shareholding in Måsøval. The process to obtain competition clearance for the Måsøval transaction is progressing according to plan, and we expect that everything will be in place sometime in the new year. To provide a bit more details, let us now move to the operational updates. In Central Norway, we harvested 51,400 tonnes in the quarter and delivered an operational EBIT of NOK 342 million, corresponding to EBIT per kilo of NOK 6.6/kg. This represents a significant improvement in results compared with last year, driven by higher volume, lower cost, and better price achievement. However, we had expected costs in Q3 to be somewhat lower than they actually were.
September brought the five-week period I mentioned earlier, with a number of events involving, among other things, ISA and gill health challenges. These required us to reprioritize which sites we harvested from and meant that the sites did not achieve the expected cost development towards the end of their production cycle. This increased cost by around NOK 2 /kg for Q3 as a whole. Together with mortality costs of NOK 0.5/kg recognized in the period, this meant that the cost reduction was not as large as we had hoped. During the period, we completed harvesting of the spring 2025 generation and continued harvesting the autumn 2025 generation. The underlying biological status in Central Norway remains good. Sea lice pressure, for example, is significantly lower this year than at the same time last year.
However, some of the challenges we experienced in September will continue into Q4, when we will continue harvesting the autumn 2025 generation and start harvesting the spring 26 generation. This will have some impact on cost development, and we therefore expect only a slightly lower cost level in Q4 compared with Q3. We are maintaining our 26 volume guidance at 167,000 tonnes. In Northern Norway, we harvested 48,500 tonnes in the quarter, with an operational EBIT of NOK 790 million and an EBIT per kilo of NOK 16.3/kg. Northern Norway has performed well for a long time, and biological performance continues to be very strong. In Q3, most of the harvest came from spring 2025 generation. Costs remain at the same low level as in Q2 and was somewhat lower than last year. Looking ahead, biological status remains good.
In the fourth quarter, we will continue harvesting the spring 2025 generation and start harvesting the autumn 2025 generation. We expect a somewhat lower cost level in Q4 compared with Q3. We are also maintaining our 2026 volume guidance for Northern Norway at 135,000 tonnes, which means we expect lower volume in Q4 this year in the same quarter as last year. SalMar Ocean delivered an operational EBITDA of NOK - 2 million. As you know, harvesting at Ocean Farm 1 was completed in May, so there was no harvest volume from the segment in Q3. The next production cycle, the sixth generation, started at the unit in September. Although the fish has only been there for a short time, production has been good so far, and we look forward to harvesting towards the summer of next year.
The Sales and Industry segment delivered an operational EBIT of NOK 526 million. A number of factors contribute to the strong result in the period. We handled record harvest volumes through our facilities. Together with improvements across a number of operational KPIs, this contributed positively to the result. Sales performance was also very strong during the period. The contract share was 29% in the quarter. As expected, fixed price contracts made a greater positive contribution as a result of lower market prices in Q3. Spot sales also made a stronger positive contribution during the period, supported by good sales allocation decisions. As several of you analysts have pointed out, demand for salmon remains very strong. Week after week, record volumes have been sold out from Norway, and we continue to see the same strong interest from customers around the world.
Salmon is and will remain a strategically important product that our customers need. Healthy, nutritious, and sustainable food does not go out of fashion, and people want more of the different salmon products that we can offer. We therefore have a positive view of the market, both in terms of the demand and because low- volume growth into 2027 should support market dynamics and potentially higher prices. In the fourth quarter, the contract share is around 38%. As usual, we are not yet providing guidance of the contract share for 2027, as Q4 is the period when we enter into many of our contracts for the following year. We are seeing good demand for contracts, and currently we have several proposals on the table that we are discussing.
Moving over to the Westfjords in Iceland, where we harvested 5,200 tonnes in the quarter, with an operational EBIT of NOK +15 million and EBIT per kilo of NOK 2.9/kg. It is certainly pleasing to see Iceland return to positive results, and it is encouraging that the improvement is being driven by lower cost for the fish we are now harvesting. Price achievement was also good. With Iceland facing lower tariffs on exports to the U.S., the company benefited from selling a greater share of its volume to the U.S. market during the period. The biological status of the fish we plan to harvest in the coming period is also good. We expect a somewhat lower- cost level in Q4 compared with Q3, as a greater share of volume will come from the site with the lowest cost.
We are reducing 2026 volume guidance by 1,000 tonnes to 20,000 tonnes. We now look into our joint venture in Scotland, Scottish Sea Farms. In the quarter, there were 13,000 tonnes harvested with an operational EBIT of NOK 13 million and EBIT per kilo of NOK 1.0/kg. As expected, harvest volume was significantly higher in the quarter, with most of the 26 volumes scheduled for harvesting in the second half of the year. Unfortunately, results remain weak due to biological challenges at sea. These affected cost levels during the period and will also have an impact in Q4, as harvesting at the affected sites was completed in October. As a result, we are reducing the 2026 volume guidance by 3,000 tonnes to 40,000 tonnes.
With that, I have come to the end of the operational update. I would now like to hand over to Ulrik, who will take you through the financials.
Thank you, Frode, and good morning to all of you. In this financial update, I would like to highlight three areas. First, higher volumes, lower costs, and good price achievement have resulted in a clear improvement in earnings so far this year. Second, we continue to improve how we use our resources. Third, good cash flow has reduced our debt level even after paying NOK 1.4 billion in dividends during the quarter. Overall, this gives us a good financial position for the further development of SalMar. Let us now start with the profit and loss statement. Operational EBIT in the third quarter was NOK 1,609 million , an increase of NOK 372 million compared with the second quarter. As you can see from the bridge in the upper right corner, higher- harvest volume was the main driver behind the improvement, with a positive contribution of NOK 670 million .
Prices had a negative impact of NOK 331 million due to seasonally lower salmon prices. At the same time, our price achievement was good compared with the market development. Our achieved price was down by around NOK 3/kg from the second quarter, while SISALMON was down by around NOK 5/kg . This reflects both our contract share and the performance of our spot sales during the quarter. On costs, the development was somewhat weaker than expected when we presented the second quarter. This was mainly the case in Central Norway, where several biological factors affected costs during the quarter. We had incident-based mortality at two sites, ISA at one site, and some other fish health issues that led us to harvest fish earlier than planned.
Together, this resulted in higher costs on the fish we harvested and meant that we see a smaller cost reduction than we had previously expected. Overall, however, costs were still marginally lower, down NOK 53 million , despite the challenges in Central Norway. Some of these effects will also continue into the fourth quarter. We still expect lower costs in Q4 than in Q3, but the reduction will be somewhat smaller than we expected when we presented the second quarter. The underlying cost trend is still moving in the right direction. For Iceland and Ocean, the net impact compared with the second quarter was NOK - 21 million . This was mainly because Ocean had no harvest volume in the third quarter. In Iceland, we are seeing lower costs at the sites we are currently harvesting from. Then moving down to the profit and loss statement.
Looking at the first nine months of the year, the improvement in earnings is clear. Operational EBITDA was NOK 5,972 million , and operational EBIT was NOK 4,358 million . Operational EBIT has therefore more than doubled compared with the same period last year. Measured per kilo, the improvement is NOK 7.5 compared with the same period last year. Most of the improvement comes from lower costs, together with better price achievement. This shows the effect of higher volumes, lower costs, better quality of the harvested fish, and good price achievement. Moving further down the profit and loss statement, production tax in Norway and resource tax in Iceland were NOK 277 million in total for the first nine months. Fair value adjustments were positive in the quarter, partly due to higher forward prices and lower expected costs. For the first nine months, the fair value adjustment was stable.
The contribution from associates was positive in the quarter, mainly due to fair value adjustments in Scottish Sea Farms. For the first nine months, the contribution was NOK - 25 million . Net financial items were NOK - 960 million for the first nine months. Interest expenses isolated were NOK 41 million lower than the same period last year, mainly due to lower debt. This brings profit after tax to NOK 2,321 million for the first nine months, with adjusted earnings per share of NOK 16.2 , nearly three times the level of last year. Moving on to the balance sheet. Total assets increased by around NOK 900 million from the second quarter to NOK 57.9 billion . The increase was partly related to the accounting of new wellboat contracts under IFRS 16, as well as higher- fair value of the biomass.
We also had more biomass in sea at the end of the third quarter than both at the end of the second quarter and at the same time last year. This is worth noting after the high- harvest volume in the quarter. The cost per kilo of the standing biomass was stable compared with the second quarter and lower than at the same time last year. As a result of the positive earnings in the period, the equity ratio increased to 36% at the end of the quarter. Net interest-bearing debt was NOK 17.9 billion at the end of the quarter, down around NOK 1.2 billion during the quarter. Compared with our expected harvest volume of 347,000 tonnes this year, this equals around 52/kg . Net interest-bearing debt over EBITDA was 2.1x. Our debt level is therefore back within the range we have communicated over time.
It is worth noting that we reduced debt while also paying around NOK 1.4 billion in dividends to shareholders in July. At the end of the quarter, we had NOK 15.9 billion in available liquidity. Overall, this gives us a good financial position ahead of the planned Måsøval transaction, subject to the necessary regulatory approvals. I would also like to spend some time on the chart at the bottom of the slide. It shows harvest volume per ton of MAB in Norway. For us, this is an important measure of how well we use the MAB we have available over time. SalMar has over time had a high level of MAB utilization compared with the other large producers in the industry. Following the acquisitions of NTS and NRS in 2022, this ratio came down.
The acquisitions increased our MAB immediately, while it naturally takes longer to develop production and realize the full potential of the additional MAB. We are now back at around the level we were at before the acquisitions. I think this illustrates an important point. It takes time to develop production following a large acquisition. The entire value chain needs to develop together, from genetics and smolt to sites and farming to wellboats, harvesting capacity, and sales. Over time, our goal is to achieve as much sustainable and profitable production as possible from the MAB and the other resources we have available. Even though utilization has improved significantly, we still see further potential. This also brings me to a more general point about return on capital. Return on capital is and has always been an important measure for SalMar.
At the same time, returns need to be assessed over a sufficiently long period. In a capital-intensive industry like ours, we need to balance good current returns with investments that can support profitable growth and create more value over time. Following a large acquisition, the capital enters the balance sheet immediately, while it takes time to develop production and realize the full potential. The development of MAB utilization following the acquisitions in 2022 is a good example of this. For us, long-term value creation comes from the combination of operational efficiency, profitable growth, and financial capacity. We believe this is also how we create strong total shareholder returns over time. Let us finish the financial update by looking at the development in net interest-bearing debt during the quarter. We started the quarter with net interest-bearing debt, including leases to financial institutions of NOK 19.4 billion .
Operations generated EBITDA of close to NOK 2.2 billion . Working capital also had a positive impact during the quarter. Net investments were NOK 97 million . Investments in fixed assets were NOK 203 million , mainly related to our farming activities and upgrades at InnovaMar. This was partly offset by sales of smaller assets and dividends received from associate companies. In addition, as mentioned, we paid around NOK 1.4 billion in dividends during the quarter. After interest payments and other changes, net, including leases to financial institutions, ended at NOK 18,143 million at the end of third quarter 2026, down NOK 1,250 million . Overall, the development during the quarter shows a continued reduction in debt, while at the same time paying around NOK` 1.4 billion in dividend to shareholders. That brings us back to the point I made on the previous slide.
Our debt level is again within the range we have communicated over time. To sum up the financial update, higher volumes, lower costs so far this year, and good price achievement have resulted in a clear improvement in earnings. At the same time, we continue to improve our MAB utilization and the capacity across our value chain. Good cash flow has brought our debt level back within our communicated range. This gives us a good financial position for further development of SalMar and for the planned Måsøval transaction. With that, I will hand the floor back to Frode.
Thank you for the update, Ulrik. Let us now look at the harvesting and processing part of our value chain in some more details. In the picture behind me, you can see InnovaMar, our headquarters and largest harvesting and processing facility. Although InnovaNor in the northern part of Norway currently has the highest harvesting capacity and the strongest hourly and daily volumes. Together with Vikenco, a little further south in Central Norway, and InnovaNor in Northern Norway, we have three facilities that are on standby 24/7 to harvest and process our fish. Whenever farming needs fish to be harvested, these facilities are ready, regardless of the day, the time, or the volume involved. We have built spare capacity into these facilities to give us the flexibility to handle the fish when they are ready for harvest.
It is difficult to quantify just how much this means for our entire value chain, but there is no doubt that without these facilities, SalMar would not be able to perform as well at sea as we actually do. If you look at the charts on the right, you can see that a number of operational KPIs at the InnovaMar and InnovaNor harvesting facilities have developed positively over the past year. Looking at the year-to-date figures, we have harvested 7% more fish. Efficiency has increased by 25% due to fish per minute, and labor cost has fallen by 27%. This is the result of focused efforts, and at SalMar, we do like improvements. The green lines representing InnovaNor really show what a state-of-the-art facility can deliver. In Q3, they handled record volumes and did so very efficiently.
I think it's difficult to truly understand just how much fish this is and how fast things move when we can harvest and pack 200 big salmons per minute, or more than three big salmons per second, or 1.1 million big salmons in one week. So to everyone in the north, give yourselves a well-deserved pat on the back for a truly impressive achievement. These are industry-leading figures. The blue lines represent InnovaMar at Frøya in the central part of Norway, which has been somewhat behind InnovaNor in recent years. Even so, we can see that the upgrades we carried out this spring also significantly improved efficiency in Q3. It has been a full 16 years, or maybe we should say 32 years, because the facility is open 24/7 for most days since we opened InnovaMar. The facility therefore needs more extensive maintenance and capacity-enhancing upgrades.
We have decided to schedule an extended shutdown in the first half of next year to complete the upgrade of the harvesting part of the facility, from the gutting machines throughout to fish packing area. The budget for this is NOK 350 million. We do not expect the project to change the group's overall CapEx level in 2027 compared with 2026. This will further increase capacity and efficiency at the facility, and perhaps about one year from now, the blue lines will have caught up with and overtaken the green lines at InnovaNor. Who knows? Some healthy competition between our facilities is a good thing. Once InnovaMar has equipment that allows it to compete on equal terms with InnovaNor, it will be exciting to follow the development of their respective KPIs. Let us now turn to the volumes for next year.
2026 has been a very strong biological year for us, with several biological KPIs, including growth and survival, at very high levels compared with previous years. As I have mentioned before, favorable sea temperatures are not the only explanation. We are seeing stronger underlying performance from these fish as a result of genetics, smolt quality, vaccines, and our production strategy, including sea lice management. We have therefore incorporated this experience into our forecasting models, with assumptions for stronger underlying growth and higher survival. Together with our stocking profile and the mix of fish we currently have at sea, this means we expect to harvest 307,000 tonnes in Norway in 2027, same level as 2026. In Iceland, expected harvest volume is 18,000 tonnes, a decrease of 2,000 tonnes compared with this year. In Scotland, we expect 45,000 tonnes, an increase of 5,000 tonnes.
Including our relative share of Scottish Sea Farms, we therefore expect total harvest volume in 2027 to remain at the same level as in 2026, at 348,000 tonnes. Please note that Måsøval is not yet included in these figures, as we need to obtain competition clearance before we can include it. Looking at the chart on the right, we have realized a substantial part of our organic volume potential this year, and there is not much left before we realize what is remaining. Including Måsøval's own stated potential brings the total to 412,000 tonnes, an increase of 64,000 tonnes, or 18%, from the level in 2026 and 2027. There is room for further growth in the years ahead, and we are also preparing for this throughout how we are stocking and how the plans for stocking for 2027 looks. Let us now round off today's presentation.
As mentioned, biological status is good, and we expect somewhat lower cost in the fourth quarter. I have taken you through the guidance for the different segments, which is summarized on the right-hand side of the slide. We expect low global supply growth in 2027, while demand for our products remains strong. The process to obtain competition clearance for the Måsøval transaction is progressing according to plan. To sum up today's presentation, we have a positive view of what lies ahead. That brings us to the end of today's session. Thank you very much for your attention. Our next presentation is in February. Until then, I trust you will all continue to enjoy healthy, nutritious, and sustainable salmon on the menu. Thank you, and all the best from all of us.