Earnings call transcript: Mowi's Q2 2025 sees record revenue and increased guidance

Mowi ASA reported record Q2 2025 revenue of €1,390 million and operational profit of €189 million, driven by robust operational performance and significant cost reductions, with Q2 farming cost per kg falling to €5.39. Despite a temporary 18% industry supply surge pressuring prices, the company raised its 2025 farming volume guidance to 545,000 tonnes and targets 600,000 tonnes in 2026, capitalizing on strong global demand and its vertically integrated model. Mowi remains optimistic about future prospects, anticipating market normalization and continued cost efficiencies, with analysts maintaining a bullish outlook.

Analysis

Mowi ASA demonstrated strong operational resilience in its Q2 2025 results, achieving record revenue of €1,390 million and an operational profit of €189 million despite significant headwinds from depressed salmon prices. The primary driver of this performance was exceptional operational execution, highlighted by a 21% year-over-year increase in harvest volumes and a significant 45% reduction in cost per kilogram to €5.39. This cost discipline is a central pillar of Mowi's strategy, reinforced by a stated goal of achieving €300-400 million in cost savings over the next five years. Management characterized the current market's 18% industry supply growth as a temporary "anomaly," and forecasts a normalization to a modest 1% growth in 2026, which is expected to support a price recovery. The company's vertically integrated model provided a natural hedge, as the Consumer Products division benefited from lower raw material costs, posting a record seasonal profit. Underscoring its confidence, Mowi increased its full-year farming volume guidance to 545,000 tonnes and is targeting 600,000 tonnes for 2026, signaling growth that outpaces the broader industry. This positive outlook is supported by strong global demand, with consumption growing 17%, and a bullish analyst consensus.

Key Decisions for Investors

• Investors should recognize the current weakness in salmon prices as a likely temporary market condition, focusing instead on Mowi's robust operational performance, significant cost reductions, and increased volume guidance which position it for strong earnings growth as supply normalizes.
• It is prudent to closely monitor industry supply data, as the investment thesis is heavily contingent on the forecasted normalization of supply growth from 8% in 2025 to 1% in 2026, which would serve as the primary catalyst for price and margin recovery.
• Given the company's strong fundamentals, raised guidance, and analyst price targets ranging up to $23.99, the current stock price could represent an attractive entry point for those willing to look past the short-term pricing environment.
• Consider the company's vertically integrated business model as a key defensive characteristic, as the profitability of its Consumer Products division provides a partial hedge against low salmon prices impacting the core Farming segment.