Q3 2019 Presentation Oslo – 1 November 2019 Hallvard Muri, CEO Simon Nyquist Martinsen, CFO
Agenda Highlights Financial performance Outlook Q&A
Highlights Q3 2019 – by CEO Hallvard Muri
Solid order intake Order intake • Order intake of 778 MNOK* +74% 1 107 • 3 year service agreement signed with Mowi for the Norwegian 44 997 marine services 46 300 760 • Chile agreed significant barge contract with Australis Mar of 12.6 218 778 SW 38 MUSD with estimated delivery in Q3/Q4 2020 639 33 50 45 77 LBT • Barge Supply and Sales Contract signed with Grieg NL Seafarms Ltd 557 448 in Q3 2018, first barge included in order backlog 51 53 471 38 33 43 • Co-operation agreement signed with Cooke Aquaculture in August, 34 87 762 732 695 CBT with potential for delivery of several larger land based smolt 644 543 projects 471 376 342 • Last twelve months order intake of 3,586 MNOK, compared to 2,555 MNOK full year 2018 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q 19 *Wise order backlog as of the sale, 55 MNOK will be accounted for as reduction in order intake, adjusted here.
Activity level remains high Revenue • 21% increase in revenue compared to Q3 2018 +21% • Egersund Net group of companies included from 1 September 2018 18 • Americas another positive quarter with revenue of 155 MNOK, up from 139 MNOK in Q3 2018 852 798 753 726 • Nordic CBT increase of 23 % compared to same quarter 637 627 589 557 last year • A decrease in land based revenue compared to Q3 2018 due to phasing of projects 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 Gain sale Wise
EBITDA development • EBITDA of 115 MNOK in the quarter, including 15 MNOK in effect EBITDA of reclassification due to IFRS 16 (leases) +62% • Sale of Wise with impact of 18 MNOK in net gain 115 101 18 97 • Americas stabilized on a higher level due to improved margins, 7 7 7 8 EBITDA of 14 MNOK compared to 10 MNOK in Q3 2019 8 8 71 61 60 59 • Nordic CBT segment 6 % increase in EBITDA YoY, with strong 57 52 contributions by AKVA Marine Services and AKVA group ASA 86 82 82 71 61 60 • 59 57 Egersund Net companies contributing strong with EBITDA of 42 52 MNOK • The effect of IFRS 16 is 15 MNOK in the quarter, mainly related to 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 property rental agreements. YTD effect of 44 MNOK Gain sale Wise IFRS 16 - EN IFRS 16 - AKVA
Continued high order backlog Order backlog • Third quarter 2019 – Highlights – Order backlog at end of September of 1.5 BNOK +41% 1 611 – 1 572 Signed 4 barges with Chilean customer September of 12.6 1 524 1 430 1 380 1 381 1 356 MUSD 1 274 629 611 569 479 1 085 – 448 Won Land Based tender with Russian Sea of 11.9 MEUR in 537 629 449 359 June, not yet in backlog – Continued positive development in net sales and service 982 961 951 955 908 844 825 – 751 Divestment of Wise lausnir ehf finalized, order backlog 726 reduced with 55 MNOK 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 Land Based
Key financial metrics Revenue EBITDA EPS +110% +158% +112% 0,47 0,32 0,27 2 422 312 0,27 3,01 2,80 1 854 2,66 1 531 182 180 1 155 1,37 121 Q3 16 Q3 17 Q3 18 Q3 19 Q3 16 Q3 17 Q3 18 Q3 19 Q3 16 Q3 17 Q3 18 Q3 19 YTD YTD YTD Amortization from intangible assets related to acquisitions In August 2018, number of shares increased from 25 834 303 to 33 334 303. When calculating the EPS the monthly average shares outstanding has been used.
Our presence AKVA group Agents and distributors
Revenue in geographical regions AKVA group’s geographical regions – absolute and relative 852 798 771 726 637 627 589 557 61% 63% 66% 68% 70% 70% 633 74% 74% 541 603 506 392 412 372 379 22% 19% 20% 139 23% 20% 113 125 155 24% 17% 17% 145 177 136 128 18% 17% 14% 106 105 90 10% 74 76 9% 9% 9% 59 49 6% 42 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 Q3 19 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 Q3 19 Nordic Americas EME
Development in OPEX based revenue • Egersund Net contributing 104 MNOK in the quarter 33,8% 300 35 32,3% 31,2% 234 257 • 28,2% 245 30 Stable development for the rental business (Scotland and 27,5% 250 26,1% Norway) in 2019 25 22,5% 22,1% 112 200 94 90 104 • Service in ASA Nordic continued to deliver high revenue and 20 31 margins 150 15 • 100 AKVA group Software with revenue increase of 14 % compared to 10 Q3 last year, and increased margins 151 149 145 144 146 141 136 130 50 5 • High activity level in the Norwegian marine service business with improved margins 2019 compared to Q3 2018, and with strong 0 0 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 order backlog % of total revenue OPEX Based revenue • Wise lausnir ehf excluded from 1 September 2019 Egersund Net
Revenue by product group and species By product groups – Q3 2019 By species – Q3 2019 798 852 852 798 13 44 56 771 771 1 23 39 726 726 66 0 28 118 0 68 95 44 92 74 35 637 1 637 627 627 42 589 589 40 129 47 42 557 1 55 189 557 1 Software 47 52 51 218 Non seafood 46 212 1 46 124 54 116 34 0 LBT S&AS 108 32 Other species 201 124 98 LBT 140 82 774 719 99 CBT S&AS 669 610 539 526 500 503 Salmon 471 446 439 370 351 352 334 CBT 287 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 Salmon = Revenue from technology and services sold to production of salmon Cage Based Technology = Cages, barges, feed systems, nets and other operational systems for cage based aquaculture Other species = Revenue from technology and services sold to production of other species than salmon S&AS Cage Based = Service and after sales for cage based aquaculture Non Seafood = Revenue from technology and services sold to non seafood Software = Software and software systems customers Land Based Technology = Recirculation systems and technologies for land based aquaculture S&AS Land Based = Service and after sales for land based aquaculture
Q3 – Operational Highlights • Wise lausnir ehf an Icelandic subsidiary was sold in Q3 • “First” barge contract signed in Chile, delivery from new partner in Vietnam • Co-operation agreement for Land Based projects entered into with Cooke Aquaculture • 3 years frame agreement signed for Norwegian marine services • Good progress made on establishing service business on New Foundland • Good progress made of renewal of Fishtalk and AKVAconnect platforms, further contracts with Observe AI (intelligent feeding) agreed • Continued solid performance in net and net service business and progress made of exploring net service business in Chile • New products launched at Aqua Nor, new cage concept and waterborne feeding
1. Atlantis Subsea Farming AS applied for 6 development licenses the 29th of January 2016 2. The Norwegian Directorate of Fisheries have informed the company that the company’s concept has progressed another step further in the process to get awarded development licenses. 3. The Directorate will go ahead with processing the application limited to 2 licenses, but have rejected the application in terms of the other 4 permits applied for. Risk management 4. On May 9th 2017 the company appealed the decision of rejecting the 4 permits. 5. On June 16th 2017 the Directorate forwarded the appeal to the Norwegian Ministry of Trade, Industry and Fisheries, for their final decision. On December 18 th 2017 The Ministry rejected the appeal. The decision is final and 6. cannot be appealed. On February 22 nd 2018, The Directorate announced that the Company has been 7. granted one license. 8. Atlantis Subsea Farming AS is now in a technology testing phase with regards to Submerge and raise the cage – safe and remote execution of the project. Underwater feeding Fish health operations Daily operations (dead fish removal, surveillance, cleaning, etc) Air to the salmon Artificial air space
Financial performance Q3 2019 – by CFO Simon Nyquist Martinsen
Q3 2019 – Financial highlights Revenue • Last twelve months order intake and revenue now at 852 798 3,586 MNOK and 3,148 MNOK respectively 771 726 • 637 The order book has decreased to 1,524 MNOK at the end of 627 589 Q3 2019, sale of Wise impacts decrease with MNOK 55 557 537 510 484 449 • Strong growth in the Nordic and Americas region, decline 408 393 354 in EME and Land Based (due to phasing of orders) • Egersund Net with an 18% increase in year to date revenue compared to 2018 (pro forma compared to last year) • Net gain from sale of Wise included with 18 MNOK in Q3 Q1 Q2 Q3 Q4 2016 2017 2018 2019
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