Company presentation March 2015 Your Aquaculture Technology and Service Partner
Important Information About this Company Presentation This Company Presentation has been prepared by AKVA group ASA ("AKVA group" or the "Company") for information purposes only, and does not constitute investment advice or an offer to sell or a solicitation of an offer to buy any securities in any jurisdiction to any person. Any recipient or reader of this Company Presentation contemplating to make an investment in the Company must rely on their own examination of the Issuer, including the merits and risks involved. Each recipient and reader of this Company Presentation should consult with its own legal, credit, business or tax adviser as to legal, credit, business and tax advice. By receiving or accessing this Company Presentation you acknowledge that you will be solely responsible for your own assessment of the market and the market position of the Company and that you will conduct your own analysis and are solely responsible for forming your own opinion of the potential future performance of the Company’s business. The information contained in this Company Presentation has not been independently verified. No representation or warranty (express or implied) is made as to the accuracy or completeness of any information contained herein, or any oral information provided in connection therewith, and it should not be relied upon as such. The Company accepts no liability whatsoever arising directly or indirectly from the use of this Company Presentation. This Company Presentation is current as of 14 November 2014. Nothing herein shall create any implication that there has been no change in the affairs of AKVA group since such date. This Company Presentation contains forward-looking statements relating to the Company's business, the Company's prospects and other forward-looking statements. Forward-looking statements concern future circumstances and results and other statements that are not historical facts, sometimes identified by the words "believes", "expects", "predicts", "intends", "projects", "plans", "estimates", "aims", "foresees", "anticipates", "targets", and similar expressions. The forward-looking statements contained in this Company Presentation, including assumptions, opinions and views of the Company or cited from third party sources, are solely opinions and forecasts which are subject to risks, uncertainties and other factors that may cause actual events to differ materially from any anticipated development. Your Aquaculture Technology and Service Partner
AKVA group highlights Undisputed #1 supplier of technology and services to the aquaculture sector • Salmon farming is driven by high demand, high prices and increased • technological sophistication New salmon farming growth to come from land-based and more exposed • locations with higher technological requirements AKVA group is well positioned for continued growth and margin • improvement – new dividend policy introduced in 2014 Your Aquaculture Technology and Service Partner
Agenda 1 Company 2 Market 3 Financials Your Aquaculture Technology and Service Partner
AKVA group – uniquely positioned for future growth 1 2 4 Cage-based Land-based Software The most recognized • brand in aquaculture technology Plastic and Land-based • • Software steel cages facilities Leading technology • solutions and service partner to the global Infra- Land-based aquaculture industry structure equipment Global presence - • subsidiaries in 8 Feed countries systems, sensors 726 employees and • cameras Market cap of NOK • 3 Technology ~700m and net debt and of NOK 88m farming services Your Aquaculture Technology and Service Partner
1 Cage-based technology Overview of AKVA group deliveries Comments • Complete range of technologies to operate any cage based aquaculture system in sea and lakes • Most technologies are in-house developed – AKVA has partnerships on nets, mooring and larger boats • Solution can be configured according to variation in customer needs • Trend towards enlargement and complete system deliveries • Complete site investment in developed salmon industry costs NOK 25-40m per site and is growing • Delivery time for a complete site is 6-8 months • Significant installed technology base – foundation for ongoing buildup of technology services Your Aquaculture Technology and Service Partner
2 Land-based technology Overview of AKVA group deliveries Comments • Complete range of technologies to operate land based aquaculture systems. Most technologies are in-house developed. AKVA also holds installation capability • Solutions can be configured according to variation in customer needs • Trend towards enlargement and complete system deliveries • Complete site investment in developed salmon industry range from NOK 200 – 400m for a complete facility. Farming technology constitutes 30-50% of total investment • Delivery time for a complete site is 6- 18 months • Growing installed technology base – foundation for ongoing buildup of technology services Your Aquaculture Technology and Service Partner
3 Technology and farming services Illustration of technology and farming services Comments • Building reoccurring technology services based on large installed technology base • Utilizing size of AKVA and the most developed infrastructure established in all salmon producing regions. • Service agreements secure entry to customers, revenues for reoccurring maintenance and upgrades as well as customer satisfaction • Introduction of equipment rental bundled with services represents the next step in development, utilizing existing service infrastructure and shifting revenue streams from customer CAPEX to customer OPEX Your Aquaculture Technology and Service Partner
4 Software Illustration of software offering Comments • Clear #1 supplier of best of breed software for management, monitoring and control of fish farming operations (Fishtalk) as well as operational software running and automating farming operations (AKVA control and AKVAconnect). • Clear #1 player in the salmon industry, however systems are applicable for multiple species • Reoccurring business model – licensing right to use – prepaid. Pricing linked to volume of production and inflation • Developing and launching new modules with similar revenue potentials and business model as existing modules in place. Your Aquaculture Technology and Service Partner
Presence in all main farming regions Map of activities Revenue per region, 2014 Export 13 % Americas 16 % Nordic Nordic Americas Export 71 % Your Aquaculture Technology and Service Partner
Strategic priority to increase the proportion of software and service-related revenue Revenue reoccurring vs technology, 2014 Comments • Introduction of rental business model in Norway. Already successfully introduced in UK and Canada • Rental is an “all inclusive service” providing for instance light Reoccurring or picture for an agreed period of time (2 to 5 years duration) 24 % - reduced CAPEX and reducing operational work from the customer • Acquisition of Yes Maritime in 2014, a provider of diving, ROV and other services to the salmon farming sector (Farming services) • Development of Farming Services still in an early stage – opportunity for consolidation Technology 76 % • Aim of delivering more than 30% of revenue through software and services – by developing software, farming services, technology services and rental further Your Aquaculture Technology and Service Partner
AKVA group’s values Your Aquaculture Technology and Service Partner Your Aquaculture Technology and Service Partner
AKVA group serves all salmon farmers in the World Customer examples Revenue per customer, 2014 Customer 1 10% Customer 2 6% Customer 3 5% 79% Other Your Aquaculture Technology and Service Partner
40 years of history – significant operational improvements undertaken in recent years 2014 Introduction 2014 of new Acquisition of 2013 dividend YesMaritime AS policy Acquisition of 2012 Plastsveis AS Sale of the 2011 Maritech Share issue 2007/2008 operation in Norway UNIAqua / 2007 Idema Aqua Acquisition of 2006 Maritech Listed on OSE 2000s International Acquisitions 1990s Profitable growth International 1980s expansion Steel cages 1980s Focus on: Feed system 1974 - Customer satisfaction Plastic cages - Profitable growth Founder-driven growth - Controlled cost - Sound financial position Your Aquaculture Technology and Service Partner
Agenda 1 Company 2 Market 3 Financials Your Aquaculture Technology and Service Partner
Strong demand for salmon - analysts expect high and stable salmon prices going forward Annual harvest volumes of Atlantic salmon Salmon price history and forecast, NOK/kg Million tonnes 41 41 40 2.5 39 38 2.0 26 +9% 1.5 1.0 0.5 0.0 2015e 1) 2016e 1) Long-term 2) 1995 2000 2005 2010 2014 Avg 1996- 2013 2014 2012 Source: Fish Pool, broker research reports, Arctic Securities Notes: 1) Average across Fish Pool and 6 broker estimates 2) Average across 2 broker estimates – others do not provide long-term forecasts Your Aquaculture Technology and Service Partner
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