Shetland salmon company Grieg Seafood Hjaltland UK has reduced its losses but still failed to meet internal targets as a glut of Chilean salmon on the market reduced prices.

Turnover increased by 2.77% to £41.9m in the year to 31 December 2009. Although the company managed to cut losses after tax by £3.44m from the previous year, it remained in the red with a loss of £705,855. Results had fallen short of expectations because Chile harvested larger-than-usual volumes of salmon last year in response to an outbreak of salmon anaemia virus, the directors said in their report to the accounts.

Grieg's salmon had also grown more slowly than expected as a result of prolonged low sea temperatures. Prices were, however, set to improve as Chilean farmed salmon production was expected to fall significantly in 2010 and for several years after, the directors said.