Lerøy Seafood Group will cease production at one of its Norwegian facilities by the end of this year.
The Norway-headquartered seafood company plans to close its processing plant in Hestvika, citing “structural market changes that cannot be ignored”.
Roy Eide, managing director of Lerøy Seafood Industri, described the move as “difficult but necessary”.
Located on the island of Hitra, the Hestvika site is ageing and would require “significant” investment in maintenance and modernisation, Lerøy Seafood said.
However, current and anticipated processing volumes do not justify that expenditure. The company said consolidating operations would allow its production capacity to better reflect market demand and improve the efficiency of its seafood supply chain.
Processing currently carried out at Hestvika will be transferred “elsewhere” within Lerøy Seafood’s network. The company did not specify which products are handled at the facility or identify the sites that will receive the work.
Lerøy Seafood, which is listed on the Oslo Stock Exchange, did not disclose how many roles would be affected by the closure.
The group said, however, that every permanent employee at Hestvika would be offered a position at its Jøsnøya facility, approximately ten minutes away. The transition is being managed in consultation with trade union representatives and local management.
Eide said: “Hitra is, and will continue to be, an important area for Lerøy. We have great faith in the people, the expertise, and the opportunities found here.
“By consolidating our operations, we gain a stronger and more robust industrial platform, providing a solid foundation for further developing our business on Hitra and in the region.”
The closure forms part of broader organisational changes at Lerøy Seafood, which are designed to bring primary processing activities together within its Market Operations segment.
At the beginning of the year, processing operations previously included in the Farming segment were moved to Market Operations. In its second-quarter results, the group said the reorganisation was intended to enhance efficiency and lower costs across the business.
For the quarter ending 30 June, Lerøy Seafood recorded group revenue of Nkr7.90bn ($828.8m), representing an 11% decline from the same period last year. Operational EBIT decreased by 16% to Nkr574m.
The company posted a net loss of Nkr240m for the quarter, compared with a profit of Nkr93m in the corresponding period of the previous year.
