SALMAR ASA Nordic Credit Rating (NCR) said today that it had assigned a 'A-' long-term issuer rating to
Rationale
The ratings reflect the company's strong profitability relative to its peer group, which is due to its cost-efficient production and excellent farming locations. The rating further reflects the company's strong cash flow and moderate financial leverage. We believe that the current owner-manager structure will keep
The rating is constrained by the sector's historical earnings volatility due to unstable prices as a result of variable supply. Moreover, we take into account environmental challenges and disease problems in our assessment of the operating environment. Positively, we note that salmon is a healthy food product, with a lower environmental footprint than other sources of protein.
Stable outlook
The outlook is stable, reflecting our view that profitability will remain strong in the years ahead. We anticipate that a bounce-back of demand after the COVID-19 pandemic and lower supplies from Chilean producers will support prices over the next three years. Accordingly, we expect
| Rating list | Rating |
| Long-term issuer credit rating: | A- |
| Outlook: | Stable |
| Short-term issuer credit rating: | N-1+ |
| Senior unsecured issue rating: | BBB+ |
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The methodology documents used for this rating are NCR's Corporate Methodology published on
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