Aker Biomarine Asa · OSL:AKBM

Aker Biomarine Asa — Q3 2020 Earnings Presentation

29 slides from Aker Biomarine Asa's earnings presentation, Oct 30, 2020

  1. Slide 1: Q3 2020 Presentation

    Q3 PRESENTATION 30 OCTOBER 2020 Q3 2020 PRESENTATION Matts Johansen, CEO Katrine Klaveness, CFO 30 OCTOBER 2020 1

  2. Slide 2: Important Notice

    Important Notice This presentation has been prepared by Aker BioMarine AS (the "Company"). The presentation does not constitute or form part of, and should not be construed as, an offer, solicitation or invitation to subscribe for, underwrite or otherwise acquire, any securities of the Company or an

  3. Slide 3: Third quarter 2020 highlights

    Third quarter 2020 highlights  Adjusted EBITDA of USD 27m  Revenue in the quarter impacted by shortfall in Qrill sales as a result of lower krill harvesting  Qrill Aqua demand healthy with all-time high monthly sales in September with close to 5,000 MT  Solid margin uplift driven by strong onsho

  4. Slide 4: Revenue and Adjusted EBITDA

    Revenue and Adjusted EBITDA REVENUE DEVELOPMENT ADJUSTED EBITDA DEVELOPMENT USDm USDm +22% +27% 213 57 174 45 +17% +2% 27 23 69 70 Q3 2019 Q3 2020 YTD Q3 2019 YTD Q3 2020 Q3 2019 Q3 2020 YTD Q3 2019 YTD Q3 2020  Quarter on quarter growth flat, but 22% growth YTD last year to YTD this year driven by

  5. Slide 5: Ingredients segment

    Ingredients segment Operations Superba QRILL  Very strong onshore production performance  New customers won across multiple markets  Sales of Qrill Aqua impacted by reduced harvesting  26% higher production YTD 2020 vs 2019  After rapid growth in South Korea the  Underlying demand is good, sel

  6. Slide 6: Brands segment

    Brands segment Lang Epion Sales development1 Sales YTD Q3 2019 30% 70% Ingredients Brands  Performance in line with plan  Sales continue to respond well to marketing  Sales growth of 28% YTD 2020 from YTD 2019 and 22% from  On shelves at new retailers, Costco and Big Y Sales YTD Q3 2020 third qu

  7. Slide 7: Kori sales shows promising development, now also with Costco on board

    Kori sales shows promising development, now also with Costco on board Units Sold by week from all retailers Current retailers 5.5x 2nd place for Buyers Choice during ECRM Won second place at the ECRM Buyers’ Choice Award (the Premier retail event in US) 16 May 23 May 30 May 06 Jun 13 Jun 20 Jun 27 J

  8. Slide 8: 2020 adjusted EBITDA target: Extraordinary events compensated by higher margins

    2020 adjusted EBITDA target: Extraordinary events compensated by higher margins for Superba and cost efficiency measures Onshore production USD USD 80-90, 80-90 mill., efficiency driving USD USD 80-90m, 80-90 mill., high-end high-end of of range Low krill harvesting high margins for low-end low-end

  9. Slide 9: Antarctic Endurance not ramping up as expected

    Antarctic Endurance not ramping up as expected ANTARCTIC ENDURANCE CAPACITY UTLILIZATION 100% 84% 62%  Aker BioMarine took delivery of the brand new first ever tailormade krill harvesting vessels in January 2019  With a new vessel filled with advanced, bespoke technology, several required adjustme

  10. Slide 10: Sustainable growth: Roadmap for long-term value creation

    Roadmap for long-term value creation 5-YEAR ASPIRATION PLAN TO LIFT EARNINGS MAIN VALUE CREATION PILLARS Adj. EBITDA (USDm)  Expand offshore harvesting capacity 1.8x over the next few years and lower logistic cost with new service vessel Scale  Substantial increase in onshore volumes  Derive sign

  11. Slide 11: Finance

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  12. Slide 12: Financial development YTD per third quarter

    Financial development YTD per third quarter REVENUE ADJUSTED EBITDA ADJUSTED EBITDA MARGIN NET INTEREST-BEARING DEBT USDm USDm % USDm +22% +27% 27% -42% 213 57 27% 386 26% 174 45 222 YTD Q3 2019 YTD Q3 2020 YTD Q3 2019 YTD Q3 2020 YTD Q3 2019 YTD Q3 2020 YTD Q3 2019 YTD Q3 2020 12

  13. Slide 13: Quarterly development of key financials in the last year

    Quarterly development of key financials in the last year REVENUE AND GROSS MARGIN DEVELOPMENT ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN DEVELOPMENT USDm USDm 72 71 72 70 27 69 23 18 47.7% 46.4% 13 38.2% 36.1% 35.1% 36.4% 33.3% 8 24.3% 17.9% 11.4% Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q3 2019 Q4 2

  14. Slide 14: Ingredients segment performance

    Ingredients segment performance REVENUE DEVELOPMENT ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN DEVELOPMENT USDm USDm +13% +23% 143 47 126 38 +2% -2% 23 22 51 50 43.2% 44.9% 30.1% 32.7% Q3 2019 Q3 2020 YTD Q3 2019 YTD Q3 2020 Q3 2019 Q3 2020 YTD Q3 2019 YTD Q3 2020  Different product mix in Q3 2020

  15. Slide 15: Production volumes on a rolling twelve-month basis

    Production volumes on a rolling twelve-month basis  Houston is producing close to maximum capacity of 1,000 MT ONSHORE KRILL OIL EXTRACTION (LTM) MT  Strong growth in Houston over the past quarters due to +59%  Capacity project in 2018 fully ramped-up 961  New plant management with strong proces

  16. Slide 16: Brands segment performance

    Brands segment performance REVENUE DEVELOPMENT ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN DEVELOPMENT USDm USDm +56% +131% 84 12 54 +34% +146% 5 28 21 4 1 12.6% 14.3% 6.9% 9.7% Q3 2019 Q3 2020 YTD Q3 2019 YTD Q3 2020 Q3 2019 Q3 2020 YTD Q3 2019 YTD Q3 2020  Brands revenue was USD 27.8m in Q3 2020,

  17. Slide 17: Profit and loss in Q3 2020 and Q3 2020 YTD

    Profit and loss in Q3 2020 and Q3 2020 YTD 2019 Q3 2019 Q3 2020 YTD Q3 2019 YTD Q3 2020 USD thousands SG&A (Audited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)  Impacted by high marketing costs in Q3 2020 due to Kori launch of USD 4.3m as well as costs related to the Merkur listing  Ongoing c

  18. Slide 18: Cash flow in Q3 2020 and Q3 2020 YTD

    Cash flow in Q3 2020 and Q3 2020 YTD 2019 Q3 2019 Q3 2020 YTD Q3 2019 YTD Q3 2020 Cash flow from operations (Audited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)  Change in working capital primarily include build-up of inventory amounting to USD 19.0m as well as paid outstanding guarantee fee t

  19. Slide 19: Balance sheet in Q3 2020 and Q3 2020 YTD

    Balance sheet in Q3 2020 and Q3 2020 YTD 2019 Q3 2019 Q3 2020 USD thousands Inventories (Audited) (Unaudited) (Unaudited)  Total book value of inventory USD 119.5m  Build-up during the quarter, in both segments ASSETS Intangible assets Cash and cash equivalents 13,610 21,918 13,055  The successfu

  20. Slide 20: Concluding remarks

    CONCLUDING REMARKS to, aNiuvWolg yaxv ©)

  21. Slide 21: Eventful times for Aker BioMarine

    Eventful times for Aker BioMarine SCIENCE AND NEW PUBLICATIONS Astaxanthin and QHP increased resistance and survival under hyper-intensive nursery conditions Oct ESG: Aker BioMarine granted Antarctic Wildlife Research Fund for ecosystem research in Antarctica Oct OTHER KEY EVENTS ESG: Antarctic kril

  22. Slide 22: ESG: Sustainable harvesting

    ESG: Sustainable harvesting Our practise again re-certified and recognised as industry leading AKER BIOMARINE HAS AGAIN RECEIVED HIGHEST AKER BIOMARINE HAS AGAIN RECEIVED THE HIGHEST RANKED MSC1-CERTIFICATION RANKING FROM SUSTAINABLE FISHERIES PARTNERSHIP The MSC Fisheries Standard is used to assess

  23. Slide 23: Summing up the quarter…

    Summing up the quarter…  Adjusted EBITDA of USD 27m  Revenue in the quarter impacted by lower krill harvesting  Solid margin uplift driven by strong onshore performance and favourable product mix  Kori roll-out in the US according to plan  High level of activity with several new patents granted

  24. Slide 24: … and on track for delivering on our long term ambitions

    … and on track for delivering on our long term ambitions Target positioning 2019 2024 246 Revenue ($mm) >700 1 Strong growth profile 2 Significant profitability expansion, targeting USD 200m EBITDA by 2024 22% EBITDA margin 30% 3 Undisputed market leader with unsurpassed scale 53 EBITDA ($mm) 200 4

  25. Slide 25: Appendix

    iS) AKER BIOMARINE APPENDIX

  26. Slide 26: Sustainability is at the heart of the way we do business

    Sustainability is at the heart of the way we do business Dedicated to improving Pioneering sustainable Ingredients for more Doing more and better human health fisheries sustainable aquaculture with less Helping prevent lifestyle diseases Leveraging technology to reduce by-catch Reducing pressure on

  27. Slide 27: Revenue development per product

    Revenue development per product REVENUE PER PRODUCT (EXCLUDING ELIMINATIONS) USDm 227.0 11.5 180.2 8.9 84.3 53.9 55.9 50.1 78.1 71.9 3.2 2.8 20.7 27.8 20.5 23.9 75.4 67.2 27.9 23.2 Q3 2019 Q3 2020 YTD Q3 2019 YTD Q3 2020 Krill oil Qrill Aqua Brands1 Other2 1) Brands (Lang) included from March 2019 i

  28. Slide 28: EBITDA adjustments

    EBITDA adjustments EBITDA ADJUSTEMENTS EBITDA ADJUSTEMENTS Q3 2020 EBITDA adjustments YTD Q3 2020 EBITDA adjustments 53,0 USDm USDm 26,8 57,0 0,8 1,1 0,6 (1,0) 1,4 21,8 0,0 (0,4) 45,7 1,8 4,3 10,3 3,4 45,7 1,3 EBITDA Q3 2020 Launch costs Legal expenses Juvel cost net of Other/transaction Adj. EBITDA

  29. Slide 29: P&L reconciliation

    P&L reconciliation USDm 2019 Q3 2019 Q3 2020 YTD Q3 2019 YTD Q3 2020 Ingredients 177.2 51.2 50.4 126.3 142.7 Brands 82.2 20.7 27.8 53.9 84.3 Eliminations (13.4) (3.0) (8.0) (6.0) (13.9) Reported revenues 246.2 68.9 70.2 174.2 213.1 EBITDA reconciliation USDm 2019 Q3 2019 Q3 2020 YTD Q3 2019 YTD Q3 2

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