SalMar ASA

Earnings Release • Feb 15, 2018

SalMar - Fourth quarter 2017 results

SalMar - Fourth quarter 2017 results

OPERATIONAL PERFORMANCE IMPROVES FOR FOURTH SUCCESSIVE QUARTER

SalMar has improved its underlying operational performance and reduced costs for

the fourth quarter in a row. The Group's Operational EBIT in the period came to

NOK 707.2 million, up from NOK 557.0 million in the fourth quarter 2016. The

improvement is largely attributable to a higher harvested volume, combined with

improved underlying operations and enhanced biological control.

"A higher harvested volume, an improved biological situation and efficient

operations have helped SalMar to post yet another strong financial result," says

CEO Trond Williksen. "The improvement in underlying operations for the fourth

quarter in a row is the result of investments in competence and capacity over

time. And these investments will continue. Our ambition to be the lowest-cost

producer remains in place, and we will carry on striving to improve our

performance in all areas of our business. SalMar remains determined to increase

its production volume, and is therefore working actively along several lines to

realise this objective. In the long term, this will contribute to continued

sustainable growth for SalMar."

SalMar generated gross operating revenues of NOK 2.8 billion in the fourth

quarter 2017, up from NOK 2.5 billion in the corresponding period in 2016. The

Group harvested 39,900 tonnes in the quarter, compared with 26,500 tonnes in the

same quarter the year before. EBIT per kg came to NOK 17.70, down from NOK

20.98 per kg in the fourth quarter 2016. The average spot price in the same

period fell by NOK 17.74 per kg.

The Fish Farming Central Norway segment continues to improve its biological

situation. A steady decline in lice numbers helped to reduce costs. This

positive trend, which is expected to continue in the first quarter 2018, is the

result of systematic efforts to strengthen the segment's preparedness, capacity

and competence to deal with biological challenges. Despite the improvement,

however, the company will continue to maintain a high level of preparedness,

which will also affect costs in the coming quarters as well.

The Fish Farming Northern Norway segment has experienced a rise in lice numbers

in certain areas, which negatively impacts the segment's costs. This applies, in

particular, to fish transferred to sea farms in the autumn of 2016. The

increased delousing treatments needed by these fish will also push up costs in

the coming quarters. SalMar is well equipped to deal with the segment's lice

situation in the future.

The Sales and Processing segment posted an Operational EBIT of NOK 175.5 million

in the quarter, compared with a corresponding loss of NOK 180.5 million the year

before. The strong result is attributable to improved operational performance,

and to the fact that 44 per cent of the volume was sold under contract at prices

in excess of the average spot price for the period. In addition, higher harvest

volumes contributed to increased capacity utilisation and greater operating

efficiency in the harvesting and secondary processing activities. As at mid-

February, the contract rate stands at around 48 per cent for the first quarter

2018 and at around 26 per cent for 2018 as a whole.

Based on estimates of the standing biomass at the close of 2017, the global

supply of Atlantic salmon is expected to increase by 6 per cent in 2018.

Combined with expectations of continued strong and stable demand, this indicates

a balanced salmon market, with the outlook for continued strong earnings in the

time ahead.

In 2018 as a whole, SalMar expects to harvest around 143,000 tonnes in Norway

(96,000 tonnes in Central Norway and 47,000 tonnes in Northern Norway). Norskott

Havbruk (Scottish Seafarms) expects to harvest approx. 26,000 tonnes in 2018,

while Arnarlax expects to harvest some 11,000 tonnes.

Based on the financial results for 2017, SalMar's board of directors is

proposing a dividend of NOK 19 per share.

The full report for the fourth quarter 2017 is attached.

For further information, please contact:

CEO Trond Williksen

Tel: + 47 916 30 173

Email: trond.williksen@salmar.no

CFO Trond Tuvstein

Tel: + 47 918 53 139

Email: trond.tuvstein@salmar.no

See www.salmar.no for more information about the company

This information is subject to the disclosure requirements stipulated in section

5-12 of the Norwegian Securities Trading Act