Q4 2015 Presentation Oslo - February 19 th , 2016 Trond Williksen, CEO Eirik Børve Monsen, CFO Your Aquaculture Technology and Service Partner
Agenda 1 Highlights 2 Financial performance 3 Outlook 4 Q&A Your Aquaculture Technology and Service Partner
Highlights Q4 2015 - by CEO Trond Williksen Your Aquaculture Technology and Service Partner 3
Best year ever - second year in a row Fourth Quarter 2015 and year end – Highlights 2014 vs 2015 • All business segments with good performance in Q4 – best Q4 ever 1 400 • 10,0 % 9,5 % A broader mix of products and services contributing to revenues in 2015 compared to earlier years – becoming a stronger and more diversified 1 200 8,3 % AKVA group 8,0 % 1 000 • Land based with best quarter ever – becoming an important part of AKVA 6,0 % 800 MNOK • 1 425 Profitable Chile operation in 2015 despite challenging market conditions 1 246 600 4,0 % • Ending the year with the best order backlog ever 400 • 2,0 % Dividend of NOK 1.00 per share paid in November 200 • 135 103 Best year ever financially – growth in revenues and margins 0 0,0 % 2014 2015 Operating revenue EBITDA EBITDA % • Strong financial position Your Aquaculture Technology and Service Partner 4
Best Q4 ever – more diversified - smoothing out some of the seasonality Revenue +13% EBITDA +103% MNOK MNOK 344 305 27 13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 Your Aquaculture Technology and Service Partner 5
Best order backlog ever – higher degree of LBT and OPEX based revenue Order Inflow Order Backlog +152% +29% 505 MNOK MNOK 649 460 504 350 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 Good market activity and sales so far in the new year Your Aquaculture Technology and Service Partner 6
Building a stronger AKVA - step by step Revenue +14% EBITDA +31% MNOK 1 425 MNOK 1 246 135 103 743 -10 2010 2011 2012 2013 2014 2015 2010 2011 2012 2013 2014 2015 Your Aquaculture Technology and Service Partner 7
AKVA group – uniquely positioned for future growth Leading technology solutions and service partner to the global aquaculture industry Global presence - subsidiaries in 8 countries 670 employees Market cap of NOK ~1250m and net debt of NOK 134m Your Aquaculture Technology and Service Partner
Presence in all main farming regions Map of activities Revenue per region, Q4 2015 Export 12 % Americas 15 % Nordic 73 % Nordic Americas Export Your Aquaculture Technology and Service Partner
Strategic priority to increase the proportion of OPEX based revenue OPEX based vs CAPEX based revenue, Q4 2015 Comments • OPEX based revenue defined as our revenue booked as OPEX in our customers P&L • Aim of increasing relative share of OPEX based revenue through software and services – by developing software, farming services, OPEX based technology services and rental further revenue 26 % • Introduction of rental business model in Norway in late 2014. Already successfully introduced in UK and Canada • Rental is an “all inclusive” service providing for instance light or picture for an agreed period of time (2 to 5 years duration) - CAPEX based reducing CAPEX and reducing operational work for the customer revenue 74 % • Acquisition of YesMaritime 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 – opportunities for consolidation Your Aquaculture Technology and Service Partner
Revenue by product groups and species By product groups – Q4 2015 By species – Q4 2015 Land Non based Seafood 25 % 10 % Other Species 12 % Cage based 64 % Salmon Software 11 % 78 % Salmon = Revenue from technology and services sold to production of salmon Cage based technologies = Cages, barges, feed systems and other Other species = Revenue from technology and services sold to production of operational systems for cage based aquaculture other species than salmon Software = Software and software systems Non Seafood = Revenue from technology and services sold to non seafood Land based technologies = Recirculation systems and technologies for customers land based aquaculture Your Aquaculture Technology and Service Partner 11
ATLANTIS SUBSEA FARMING AS • Established in partnership with the companies Sinkaberg-Hansen AS and Egersund Net AS – 33.3% of the shares each • Purpose of developing submersible fish-farming facilities for salmon on an industrial scale • Has applied for six development licences to enable large-scale development and testing of the new technology and operational concept • Through its innovative development work, ATLANTIS aims both to contribute to better and more sustainable use of current farming sites as well as to enable use of more exposed sites than is currently possible. The goal is to achieve production gains and improve fish welfare by submerging the facilities, as they will be far less exposed to the environmental and physical conditions than in a surface position • Although ATLANTIS represents a significant leap forward in terms of innovation, it is also an objective for the concept to keep costs at a level that helps strengthen the industry's competitive position. The aim is also that the technology and operating methods developed through ATLANTIS can be made available and adopted by the industry relatively quickly Your Aquaculture Technology and Service Partner 12
Minor adjustment in dividend policy • Change of timing for the half yearly dividend policy to be based on 1 st and 2 nd half of the year (instead of Q4 – Q1 and Q2 – Q3) • Rationale: ‐ Gives a more intuitive division of the year with 2 nd half dividend being announced in connection with the Annual General Meeting ‐ Evens out more of the seasonality's in cash flow during the year • Next possible dividend pay out will be after 1st half 2016, i.e. will be announced together with the 2016 Q2 financials Your Aquaculture Technology and Service Partner 13
Financial performance Q4 2015 – by CFO Eirik Børve Monsen Your Aquaculture Technology and Service Partner 14
Q4 2015 - Financial highlights Revenue • MNOK Good overall financial performance continues – taking advantage of the diversified operations 450 400 • Land based on track after first quarter with Aquatec Solutions included 350 • Profitable operation in Chile in 2015 despite challenging market conditions – due to 300 2012 higher level of service and tight cost control 250 2013 • 200 WiseDynamics in Canada divested in November 2015 – marginal impact on Group 2014 financials 150 2015 • 100 Share buyback program finalized in November 2015 – Shares awarded to employees in January 2016 according to the announced incentive scheme to employees 50 - • Dividend – NOK 1 per share paid in November 2015 1Q 2Q 3Q 4Q Your Aquaculture Technology and Service Partner 15
Q4 2015 - Financial highlights , continued EBITDA EBITDA % MNOK 45 14% 40 12% 35 10% 30 8% 2012 2012 25 6% 20 2013 2013 15 4% 2014 2014 10 2% 5 2015 2015 0% - -2% - 5 -4% - 10 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q Stabilizing on a historical higher EBITDA-level both in NOK and in % Getting close to the medium term target of 10% EBITDA on a annual basis Your Aquaculture Technology and Service Partner 16
Cage Based Technologies Nordic CBT (Revenue & EBITDA %) ● Decent performance in Q4, which traditionally is a low season 250 5% quarter in Nordic CBT 4,4 % 4,6 % ● 223 220 5% Good performance continued with a slightly different product mix compared to 2014 - a wider range of products contribute to 33 revenue and profit in 2015 vs 2014 200 40 4% 4% Americas ● 50 Chile delivering one of the best years ever margin wise due to 44 150 3% reduced cost base and higher level of service ● 3% Canada with a great Q4 and ending the best year ever. Lean and efficient operation 100 2% ● Australia small but profitable operation – best year ever 2% 141 136 Export ● 50 1% UK also ended their best year ever with high level of OPEX based revenue 1% ● Turkey – best year ever – experiencing increased activity in the Sea 0 0% Bass and Sea Bream industry 2014 Q4 2015 Q4 ● Nordic Americas Export EBITDA % Export to emerging markets – slow, but some activity - Iran Your Aquaculture Technology and Service Partner 17
Software SW (Revenue & EBITDA %) 45 25% 40 38 22,4 % 1 20% 3 35 ● AKVA group Software AS continues to deliver stable and 30 high margins – with improved revenue and margins YoY 30 0 5 15% ● Wise lausnir ehf – with improved performance YoY 25 14,1 % ● WiseDynamnics in Canada, a subsidiary of Wise ehf was 20 divested in November 2015. Marginal numbers for the 10% 34 group and gave a marginal gain of MNOK 1.5 in Q4 EBITDA 15 ● 25 Software continues to invest in new product modules, 10 which is expected to strengthen the financial performance 5% of the SW segment further 5 0 0% 2014 Q4 2015 Q4 Nordic Americas Export EBITDA % Your Aquaculture Technology and Service Partner 18
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