Q1 2015 Presentation Oslo - May 8 th , 2015 Trond Williksen, CEO - - PowerPoint PPT Presentation

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Q1 2015 Presentation Oslo - May 8 th , 2015 Trond Williksen, CEO - - PowerPoint PPT Presentation

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Q1 2015 Presentation Oslo - May 8 th , 2015 Trond Williksen, CEO Eirik Brve Monsen, CFO Your Aquaculture Technology and Service Partner Agenda 1 Highlights 2 Financial performance 3 Outlook 4 Q&A Your Aquaculture Technology and

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SLIDE 1

Your Aquaculture Technology and Service Partner

Q1 2015 Presentation

Oslo - May 8th, 2015 Trond Williksen, CEO Eirik Børve Monsen, CFO

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Your Aquaculture Technology and Service Partner

Agenda

Highlights Financial performance Outlook 1 2 3 Q&A 4

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Your Aquaculture Technology and Service Partner 3

Highlights Q1 2015 - by CEO Trond Williksen

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Your Aquaculture Technology and Service Partner

On track - record high order backlog

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  • Overall good performance – on track

‐

Benefitting from being a diversified Group both geographically and product vice

  • Strong first quarter in Chile, Canada and UK
  • A good start for Cage Based segment in Norway, but

‐

with a different product mix compared to Q1 2014, and

‐

some of the deliveries moving in to Q2 2015

  • Slow start for the Land Based segment and for export to

emerging markets

  • High market activity resulting in the best order backlog ever –

547 MNOK

First quarter 2015 – Highlights

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Your Aquaculture Technology and Service Partner

On track - record high order backlog

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+24% +53%

32 27 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 MNOK

EBITDA

310 325 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 MNOK

Revenue

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Your Aquaculture Technology and Service Partner

243 367 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 MNOK

Order Inflow

On track - record high order backlog

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520 452 547 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 MNOK

Order Backlog

+51% +21%

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Your Aquaculture Technology and Service Partner

AKVA group – uniquely positioned for future growth

Cage-based Land-based Software

  • The most recognized

brand in aquaculture technology

  • Leading technology

solutions and service partner to the global aquaculture industry

  • Global presence -

subsidiaries in 8 countries

  • 740 employees
  • Market cap of NOK

~670m and net debt

  • f NOK 82m
  • Plastic and

steel cages Infra- structure Feed systems, sensors and cameras Technology and farming services

  • Land-based

facilities Land-based equipment Software

1 2 4 3

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Your Aquaculture Technology and Service Partner

Presence in all main farming regions

Map of activities Revenue per region, Q1 2015

Nordic Americas Export

Nordic 67 % Americas 21 % Export 12 %

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Your Aquaculture Technology and Service Partner

Strategic priority to increase the proportion of reoccurring revenue

Technology sale vs reoccurring revenue, Q1 2015 Comments

  • Introduction of rental business model in Norway in Q4 2014.

Already successfully introduced in UK and Canada.

  • First installations of rental equipment in Norway done in Q1 2015
  • Rental is an “all inclusive service” providing for instance light or

picture for an agreed period of time (2 to 5 years duration) - reduced CAPEX and reducing operational work for the customer

  • Acquisition of YesMaritime in 2014, a provider of diving, ROV and
  • ther services to the salmon farming sector (Farming services)
  • Development of Farming Services still in an early stage –
  • pportunity for consolidation
  • Aim of increasing relative share of reoccurring revenue through

software and services – by developing software, farming services, technology services and rental further

Technology 72 % Reoccurring 28 %

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Your Aquaculture Technology and Service Partner

Revenue by product groups and species

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  • Cage based technologies = Cages, barges, feed systems and other
  • perational systems for cage based aquaculture
  • Software = Software and software systems
  • Land based technologies = Recirculation systems and technologies for

land based aquaculture

By product groups – Q1 2015 By species – Q1 2015

  • Salmon = Revenue from technology and services sold to production of salmon
  • Other species = Revenue from technology and services sold to production of
  • ther species than salmon
  • Non Seafood = Revenue from technology and services sold non seafood

customers

Salmon 80 % Other Species 9 % Non Seafood 11 % Cage based 80 % Software 9 % Land based 11 %

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Your Aquaculture Technology and Service Partner

Centralized operations and wireless communication in the hotspot

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  • Technology trend aimed at improving farming performance

by enhancing overview, control and specialized feeding competence through centralized control centers

  • AKVA group supports the trend through development of the

new digital wireless communication system and AKVAconnect linking the operations in the farms to a centralized operation centers

  • Trend supports a significant growth in sales for AKVA on

sensors, cameras, control systems and solutions for automation as experienced in 2015

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Your Aquaculture Technology and Service Partner

Contract on land based cleaner-fish facility – new sealice prevention technology

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  • Contract of 23.5 MNOK signed with Namdal Rensefisk AS for

technology to new cleaner-fish production facility – owned and

  • perated by Bjørøya Fiskeoppdrett AS, Aquagen AS, Midt Norsk

Havbruk AS and Nova Sea AS

  • Use of Cleaner-fish at the core of the strategy solving the sealice

challenge facing the salmon industry

  • Namdal Rensefisk AS is in the forefront of developing farming of

cleaner fish as a sustainable way of handling sealice in the Norwegian salmon industry

  • The land based facility holds new technologies enabling

sustainable land based farming of cleaner fish

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Your Aquaculture Technology and Service Partner 13

Financial performance Q1 2015 – by CFO Eirik Børve Monsen

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Your Aquaculture Technology and Service Partner

Q1 2015 - Financial highlights

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  • Good overall financial performance – taking advantage of the

diversified operations

  • Rental business in Norway with a good start – with P&L impact

from next quarter

  • Strong balance sheet maintained

Revenue

310 301 330 305 325

  • 50

100 150 200 250 300 350 1Q 2Q 3Q 4Q 2012 2013 2014 2015

MNOK

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Your Aquaculture Technology and Service Partner

  • 10
  • 5
  • 5

10 15 20 25 30 35 40 1Q 2Q 3Q 4Q 2012 2013 2014 2015

MNOK

Q1 2015 - Financial highlights, continued

15 EBITDA

  • 4%
  • 2%

0% 2% 4% 6% 8% 10% 12% 1Q 2Q 3Q 4Q 2012 2013 2014 2015

MNOK

EBITDA %

  • Stabilizing on a historical higher EBITDA-level both in NOK and in %
  • Medium term target of 10% EBITDA still valid
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Your Aquaculture Technology and Service Partner

Cage Based Technologies

16 Nordic

  • Good start of the year, but with slightly different product mix YoY

Americas

  • Strong Q1 in Chile - the positive development in this market
  • continues. However we continue to monitor the development

closely

  • Canada continues the good performance from 2014 with the best

Q1 ever Export

  • UK continues the good performance from 2014 with the best Q1

ever

  • Turkey have a profitable Q1 with good sales
  • Low activity in Export to emerging markets YoY

155 156 24 64 62 39 241 259 10,9 % 8,9 %

5% 7% 9% 11% 13% 15% 17% 50 100 150 200 250 300 2014 Q1 2015 Q1

CBT (Revenue & EBITDA %)

Nordic Americas Export EBITDA %

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Your Aquaculture Technology and Service Partner

Software

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  • AKVA group Software AS continues to deliver stable and

high margins – with improved revenue and margins YoY

  • Wise lausnir ehf have a good start of the year – with

improved performance YoY

  • Software continues to invest in new product modules,

which is expected to strengthen the financial performance

  • f the SW segment further

22 25 4 5 1 1 26 31 11,4 % 14,0 %

7% 9% 11% 13% 15% 17% 5 10 15 20 25 30 35 2014 Q1 2015 Q1

SW (Revenue & EBITDA %)

Nordic Americas Export EBITDA %

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Your Aquaculture Technology and Service Partner

Land Based Technologies

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  • Overall a slow start for LBT segment in Q1
  • AKVA group Denmark have a good order backlog,

however delayed start-up and progress in some projects explains the low margin in LBT in Q1

  • Plastsveis is on track with a profitable Q1 and a good
  • rder backlog

41 34 2 1 43 35 5,9 %

  • 1,9 %
  • 6%

4% 14% 24% 5 10 15 20 25 30 35 40 45 50 2014 Q1 2015 Q1

LBT (Revenue & EBITDA %)

Nordic Americas EBITDA %

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Your Aquaculture Technology and Service Partner

P&L 2015 2014 2014

(MNOK)

Q1 Q1 Total OPERATING REVENUES 325,0 310,4 1 246,1 Operating costs ex depreciations 298,4 278,7 1 142,7 EBITDA 26,6 31,7 103,4 Depreciation 10,5 8,3 35,7 EBIT 16,1 23,5 67,6 Net interest expense

  • 1,3
  • 1,5
  • 4,8

Other financial items 1,5

  • 1,4

0,0 Net financial items 0,2

  • 2,9
  • 4,7

EBT 16,3 20,5 62,9 Taxes 4,9 4,9 8,4 NET PROFIT 11,4 15,6 54,5 Net profit (loss) attributable to: Non-controlling interests 0,1 0,1

  • 0,6

Equity holders of AKVA group ASA 11,3 15,5 55,1

Revenue growth 4,7 % 39,7 % 35,6 % EBITDA margin 8,2 % 10,2 % 8,3 % EPS (NOK)

0,44 0,60 2,13

Financials – Detailed P & L

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  • Low interest cost du to low net debt and low

interest rate

  • Mainly currency – considered as acceptable level
  • Minority shareholders (30%) in Plastsveis AS
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Your Aquaculture Technology and Service Partner 63 86 68 96 153 144 183 144 147 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 MNOK

Group financial profile - strong

Available cash ROCE

  • 6 MNOK

8,4 % 8,3 % 15,2 % 14,1 % 12,3 % Q1 - 2014 Q2 - 2014 Q3 - 2014 Q4 - 2014 Q1 - 2015

+3.9 percentage points

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Your Aquaculture Technology and Service Partner

338 342 342 339 347 365 375 389 403

44,3 % 44,4 % 42,8 %

38% 40% 42% 44% 46% 48% 50% 52% 300 320 340 360 380 400 420 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 MNOK Total Equity Equity Ratio

Group financial profile – strong, continued

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Working capital Equity

  • Good nominal increase in equity YoY due to profitable operation
  • Note: Dividend payment of 25.8 MNOK in Q4 2014
  • Overall low working capital level – despite record high activity
  • Due to strong capital discipline
  • Increased activity in Chile gives WC-intensive growth

+56 MNOK

162 116 126 137

20,0 % 11,5 % 10,1 % 10,8 %

0 % 5 % 10 % 15 % 20 % 25 % 20 40 60 80 100 120 140 160 180 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 MNOK

MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK MNOK

0.7 percentage point improvement

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Your Aquaculture Technology and Service Partner

122 94 108 75 70 92 44 89 82 4,3 2,4 3,2 1,6 1,0 1,3 0,4 0,9 0,8

  • 1,0

2,0 3,0 4,0 5,0

  • 30

60 90 120 150 Q1 - 2013 Q2 - 2013 Q3 - 2013 Q4 - 2013 Q1 - 2014 Q2 - 2014 Q3 - 2014 Q4 - 2014 Q1 - 2015 Net interest bearing debt NIBD/EBITDA(12months rolling)

Net debt/EBITDA of 0.8x

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Change in net debt (TNOK) Net debt (MNOK) and net debt/EBITDA

  • No dividend disbursement in Q2. Next possible dividend pay-out will according to the new dividend policy be in Q4 – based on the cash flow in Q2 and Q3

Net debt 31.12.2014 88 511 EBITDA

  • 26 610

Income taxes paid

  • 32

Net interest paid 1 309 Capex paid 10 994 Paid dividend

  • Sale of fixed assets
  • 698

Currency effects

  • 1 841

Other changes in working capital 10 784 Net change

  • 6 095

Net debt 31.03.2015 82 416

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Your Aquaculture Technology and Service Partner

Balance sheet

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BALANCE SHEET 2015 2014 (MNOK) 31.03 31.03

ASSETS 942 782 Intangible non-current assets 274 245 Tangible non-current assets 76 56 Financial non-current assets 2 2 Inventory 183 151 Receivables 349 266 Cash and cash equivalents 57 62 LIABILITIES AND EQUITY 942 782 Equity 402 344 Minority interest 2 2 Long-term interest bearing debt 126 122 Short-term interest bearing debt 14 10 Non-interest bearing liabilities 398 303

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Your Aquaculture Technology and Service Partner

CAPEX

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6 138 15 621 8 628 12 266 10 982 9 133 11 017 18 633 10 994 3% 6% 5% 5% 4% 3% 3% 6% 3%

0% 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% 2 000 4 000 6 000 8 000 10 000 12 000 14 000 16 000 18 000 20 000 Q1 - 2013 Q2 - 2013 Q3 - 2013 Q4 - 2013 Q1 - 2014 Q2 - 2014 Q3 - 2014 Q4 - 2014 Q1 - 2015

Capex (TNOK) and capex / sales (%)

8 898 2 096

CAPEX breakdown Q1 2015 (TNOK)

Ordinary CAPEX including rental Capitalized R&D expenses

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Your Aquaculture Technology and Service Partner 25

Outlooks – by CEO Trond Williksen

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Your Aquaculture Technology and Service Partner

520 452 504 547

  • 100

200 300 400 500 600 1Q 2Q 3Q 4Q 2012 2013 2014 2015

MNOK

Order backlog and inflow – Highest order backlog ever

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Order backlog Order inflow

467 243 460 367

  • 50

100 150 200 250 300 350 400 450 500 1Q 2Q 3Q 4Q 2012 2013 2014 2015

MNOK

  • Highest order backlog ever
  • The good market activity continues
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Your Aquaculture Technology and Service Partner

Maintaining positive outlook

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  • Strong overall short term outlook due to high market activity and order backlog. Our target is to outperform 2014
  • Strong demand in the Nordic market is expected to continue
  • Positive operational development in the Chilean market is expected to continue in the next quarters due to a solid
  • rder backlog. However, our Chilean customer’s struggle with low earnings brings some uncertainty to

investments in the medium term. The Volcano eruption in Chile might have a small impact short term on CBT investments, but pose an opportunity for LBT. We are monitoring the Chilean market closely and will adjust our

  • peration according to the development
  • UK and Canada are expected to continue to perform well in the next quarters with a significant order backlog and

a large portion of reoccurring business

  • Land based is expected to have a positive development with a growing order backlog and prospect mass.

Historically high market interest for LBT

  • Exports to emerging markets will continue to fluctuate short term, but represents a large potential over time. New

geographical regions continuously emerge as markets for our technology

  • We continue our effort to build service and after sales as a key business element in all markets and segments
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Your Aquaculture Technology and Service Partner 28

Q & A

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Your Aquaculture Technology and Service Partner