Agribusiness · Aquaculture
EV/kg: Valuing Aquaculture Capacity
Enterprise value per kg of gutted-weight harvest: how to build it, why the harvest basis must match EV, and why it is analyst convention, not a filed metric.
Selborne Research · Aquaculture coverage: 7 guides, 6 company profiles, a primer and Excel model
Educational analysis for professional use. This guide is not investment advice or a recommendation to buy or sell any security, and it is not personalised.
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EV per kg Is a Price per Kilo of Harvest
Salmon farmers are often compared on enterprise value per kilo of annual harvest. It is a price, not a valuation: it says what the market pays for each kilo a farmer produces a year. And it means something only if the harvest counts the same businesses the enterprise value does.
EV/kg = enterprise value ÷ annual harvest in gutted weight
The numerator is market capitalisation plus net interest-bearing debt and minority interests, usually trimmed to the farming business by taking out processing, sales and other non-farming assets. The denominator is the year’s harvest in gutted weight: the fish bled and gutted, head on. No farmer files the figure, so every analyst makes their own choices on both halves.
The Harvest Basis Has to Match the EV
Farmers publish several harvest figures, and each answers a different question.
| Filed FY2025 harvest | What it covers |
|---|---|
| Grieg Seafood 30,462 t | Rogaland only; Finnmark, British Columbia and Newfoundland were sold to Cermaq on 29 December 2025 |
| SalMar 284,500 t / 300,900 t | Consolidated / including companies it part-owns |
| Lerøy 195,555 t | Norway, excluding Scottish Sea Farms, its 50% joint venture |
If the enterprise value includes a business whose tonnes are left out of the harvest, EV per kg is overstated; if the harvest includes tonnes whose value is not in the EV, it is understated. For a company that has just sold regions, only continuing operations match the post-sale enterprise value.
Worked Example: A Fictional Farm
Take a hypothetical Norwegian farm harvesting 150,000 t a year at a farming cost of NOK 60/kg including depreciation. At a long-run salmon price of NOK 68/kg it earns NOK 8/kg of operational EBIT, or NOK 1.2bn a year. It has NOK 1.5bn of net debt, no minorities and 100m shares trading at NOK 70.
| Step | Value |
|---|---|
| Market capitalisation (100m × NOK 70) | NOK 7.0bn |
| Plus net debt | NOK 1.5bn |
| Enterprise value | NOK 8.5bn |
| Harvest | 150,000 t |
| EV per kg | NOK 56.7/kg |
Change only the basis and the figure moves. Add 10,000 t of harvest from an associate the EV does not include and the same farm shows NOK 53.1/kg. Take out NOK 1.0bn of EV for a processing business and the pure-farming figure is NOK 50.0/kg. Nothing about the farm changed.
What the Cash Flow Says the Same Farm Is Worth
At NOK 70 a share, the fictional farm’s price sits close to what a discounted cash-flow valuation says it is worth: NOK 57.4/kg against NOK 56.7/kg. Tax comes first. Since 1 January 2023 farming salmon in the sea in Norway has carried a 25% resource-rent tax on top of 22% corporate tax, a 47% marginal rate on that profit (adopted by Parliament on 31 May 2023; SalMar release of that date). The rent tax is worked out on its own profit measure, which prices the fish at a set market value at the farm. Taking 47% of EBIT is a simplification, and the steps below use it.
| Step (the Excel model’s user farm) | NOK bn |
|---|---|
| Operational EBIT (150,000 t × NOK 8/kg) | 1.200 |
| Less tax at 47% | (0.564) |
| After-tax cash flow a year, with maintenance capex equal to depreciation | 0.636 |
| Present value of years 1-6, harvest flat | 2.92 |
| Year-7 cash flow: 0.636 grown 2%, less NOK 0.075bn for extra fish in the sea | 0.574 |
| Terminal value at year 6, 0.574 ÷ (8.26% − 2%) = 9.17, discounted to the valuation date | 5.69 |
| Enterprise value | 8.61 |
| EV per kg (8.61bn ÷ 150,000 t) | NOK 57.4/kg |
The discount rate is 8.26% and long-run growth 2%. The year-7 deduction pays for growth: 2% more harvest is 3,000 t a year, and to harvest it a farmer has to carry more fish in the sea. The model sets that at NOK 25 per kg of added annual harvest, or NOK 75m a year.
The rent tax alone takes NOK 4.4bn, about NOK 44 a share: that is the present value of its payments in the model.
Why Market EV per kg Differs From the Cash-Flow Value
Real farmers often trade at an EV per kg well above what a cash-flow model at a conservative long-run price supports, because the market price carries two things the model may not.
Licence scarcity. Norway caps the weight of fish each licence may hold, and new capacity is scarce and expensive. The government sells 1% growth in its best-rated areas at a fixed price per tonne of permitted biomass: NOK 170,000 in 2024 and NOK 270,000 in the 2026 round (iLaks, 11 September 2026). Licences that cannot be replicated can be worth more than the cash they produce. The licence and MAB guide covers how capacity is added and removed.
The market’s expected salmon price. A long-run assumption of NOK 68/kg is conservative against recent prices: Statistics Norway’s weekly export price for fresh farmed salmon averaged NOK 81.79/kg in 2025 and NOK 94.44/kg in 2024 (table 03024, simple average of 52 weeks). Each NOK 1/kg on 150,000 t is NOK 150m of EBIT before tax, so the price the market has in mind moves EV per kg more than any cost line.
Read a gap between market and model EV per kg as the market’s view on those two things.
Two fictional salmon farmers and a farm you set up yourself, each valued after tax year by year, with EV per kg and an EBIT multiple as cross-checks.
- 15 sections, from how a salmon farmer earns to licence capacity, biological risk and a worked valuation
- 40 pages
- a low-cost scale farmer, a high-cost regional farmer and a farm you set up yourself
- 3 farm engines
- listed salmon farmers across Norway, the Faroes, Scotland and Chile on filed FY2025 figures
- 6-company screen
The Excel model is the primer's farming valuation live across 12 sheets: two hypothetical farmers and a farm you set up yourself, each valued on an after-tax DCF that includes Norway's resource-rent tax on salmon farming, with EV per kg and an EBIT multiple as cross-checks; a valuation summary, an EBIT-per-kg and cost-stack view, capacity against EV per kg, a cycle and biological downturn scenario and a live sensitivity grid of salmon price against farming cost. Change the price, the farming cost or the harvest and the value moves.
See what's in the Aquaculture Sector Primer →£25 PDF · £59 with the Excel model · £159 for all three Agribusiness industries
Frequently Asked Questions
- How do you calculate EV per kg of harvest?
- Enterprise value divided by annual harvest in gutted weight, expressed per kilo. Enterprise value is market capitalisation plus net interest-bearing debt plus minority interests, usually with non-farming assets taken out so that the numerator covers the farming business only. No farmer files it, so each analyst's version depends on the choices made for both halves.
- Why must the harvest basis match the enterprise value?
- Because farmers publish more than one harvest figure. SalMar reported 284,500 t consolidated and 300,900 t including associates for FY2025; Lerøy's 195,555 t excludes its Scottish joint venture; Grieg Seafood's 30,462 t covers Rogaland only after it sold its other regions. If the enterprise value includes a business whose tonnes are left out of the denominator, or the reverse, EV per kg is wrong before any comparison starts.
- Why can market EV per kg sit well above a DCF of the same farm?
- The market price carries things a DCF at a conservative long-run salmon price may not: the scarcity value of Norwegian licences, which cannot be expanded at will, and the salmon price the market expects, which can differ a lot from the long-run assumption. EV per kg is therefore only a cross-check on a cash-flow valuation.
- How does Norway's resource-rent tax affect EV per kg?
- Since 1 January 2023, profit from farming salmon and trout in the sea in Norway has carried a 25% resource-rent tax on top of 22% corporate tax, a 47% marginal rate (SalMar, 31 May 2023). The rent tax is worked out on its own profit measure, which prices the fish at a set market value at the farm, so it is not simply 25% of EBIT. A kilo of harvest in Norway therefore yields less after-tax cash than the same kilo elsewhere, and an EV per kg compared across countries has to allow for it.
Read next
Salmon Farming Economics: Cost per kg
What Mowi's cost in box and Grieg's farming cost include, and why each farmer's EBIT per kg has to be read on its own definition before comparing farmers.
Licence and MAB Capacity Constraints
Maximum allowed biomass and the harvest lag, SalMar 173,118 t vs Lerøy 117,500 t vs Grieg 17,800 t, how Norway adds capacity, and how the Faroes regulate instead.
Operational EBIT vs Reported EBIT in Salmon Farming
How IAS 41 values fish still in the sea at forward prices, what operational EBIT removes, and the FY2025 reconciliations at five salmon farmers.
See it applied
These company profiles apply the concepts from this guide to real public companies.