Akva Group Asa · OSL:AKVA

Akva Group Asa — Q2 2022 Earnings Presentation

49 slides from Akva Group Asa's earnings presentation, Aug 12, 2022

  1. Slide 1: Q2 2022 Presentation

    Q2 2022 Presentation Oslo, 12 August 2022 Knut Nesse, CEO Ronny Meinkøhn, CFO Pioneering a better future

  2. Slide 2: Pioneering a better future

    Pioneering a better future AKVAcrour

  3. Slide 3: Agenda Q2 2022

    Agenda|Q2 2022 Highlights and Financial Q&A Outlook Performance Session Knut Nesse, CEO Ronny Meinkøhn, CFO Pioneering a better future

  4. Slide 4: Highlights Q2 2022

    Highlights|Q2 2022 Operation Innovation and Digital  High activity with revenue of MNOK 907 in the quarter  Solid progression on developing Digital capabilities in line with strategic ambitions  Profitability significantly impacted by high inflation rates and cost provisions  High focus on furth

  5. Slide 5: Key figures Q2 2022

    Key figures|Q2 2022 Revenue EBITDA EBIT 907 MNOK 3 MNOK -41 MNOK 101 907 93 53 862 832 798 79 42 32 627 27 52 3 Q2 18 Q2 19 Q2 20 Q2 21 Q2 22 Q2 18 Q2 19 Q2 20 Q2 21 Q2 22 -41 Q2 18 Q2 19 Q2 20 Q2 21 Q2 22 Pioneering a better future

  6. Slide 6: Comments to financial performance in Q2

    Comments to financial performance in Q2  The P&L in Q2 22 was significantly impacted by high inflation rates and cost provisions  High inflation rates and supply chain restrictions worldwide driven by the Russia-Ukraine war with estimated MNOK 37 in additional costs. Continued uncertainty related

  7. Slide 7: Key figures H1 2022

    Key figures|H1 2022 Revenue EBITDA EBIT 1 756 MNOK 106 MNOK 17 MNOK 198 1 756 179 102 1 650 1 614 1 551 162 80 1 216 68 111 64 106 17 H1 18 H1 19 H1 20 H1 21 H1 22 H1 18 H1 19 H1 20 H1 21 H1 22 H1 18 H1 19 H1 20 H1 21 H1 22 * Note: Costs of 49,7 MNOK related to cyber-attack in Q1 21 are excluded Pio

  8. Slide 8: Market development

    Market development Source: Pareto Seafood price update June 24th 2022 Pioneering a better future

  9. Slide 9: Development order intake and order backlog

    Development order intake and order backlog Order intake (MNOK) Order backlog (MNOK) 1 048 1 862 1 849 35 67 1 740 1 769 1 650 85 880 66 87 254 827 72 29 116 742 28 96 948 829 616 21 27 867 726 779 34 19 735 695 759 704 563 Digital 935 902 Digital 848 808 852 Land Based Land Based Sea Based Sea Based

  10. Slide 10: Strategic and Operational Status

    Strategic and Operational Status Pioneering a better future

  11. Slide 11: Underlying demand growth implies 1–2 million ton volume increase by 2030

    Underlying demand growth implies 1–2 million ton volume increase by 2030 Salmon demand has increased by 1.1 mill tons from 2009-2019. “Base case” assumes similar demand growth till 2030 Consumption of salmon WFE in mill. tons Key demand drivers 5.0 High demand growth (~5%)1 2019-2030: 4.6 +1.1-2.0 m

  12. Slide 12: Three main segments within land based

    Three main segments within land based Smolt: Post-smolt: Grow-out: 100 - 250 g 250 - 1000 g 5000 g  Smolt production expected  ~160 BNOK in CAPEX to grow with approx. investments needed to reach 300,000 tons in the next 10 land-based capacity of years 800,000 tons by 2030 Pioneering a better futur

  13. Slide 13: Strategy for Land Based Salmon Farming

    Strategy for Land Based Salmon Farming Delivering complete scope of fish Market leading Zero Water Concept farming technology (e.g. feeding, fish 1 RAS enabling sustainable and cost- 2 tanks, fish handling, camera, lights, effective production sensors, control system) Data driven insight and intelli

  14. Slide 14: Tytlandsvik 4,500 tonnes post-smolt RAS facility

    Tytlandsvik 4,500 tonnes post-smolt RAS facility Pioneering a better future

  15. Slide 15: Land Based operational agenda

    Land Based operational agenda  Significant growth potential in post-smolt market  Proof of concept on AKVA technology  Ongoing investments in Land Based innovation agenda  Change of contract terms – ongoing  Project execution capabilities to be improved  More efficient AKVA Land Based organiza

  16. Slide 16: Precision Farming Sea Based Solutions

    Precision Farming Sea Based Solutions Marine Precision Feeding Digital Deep farming Infrastructure for optimizing feed to support precision to minimize number for secure containment conversion and growth farming with leading, of lice treatments and efficient operations open and modular  Barges digi

  17. Slide 17: High focus to further develop deep farming concepts

    High focus to further develop deep farming concepts Benefits from deep farming AKVA’s current commercial solutions  Avoid or reduce unwanted surface influences like lice, algae, ATLANTIS currents, high temperatures. NAUTILUS TUBENET™ SUBSEA FARMING  Better fish health and reduced mortality  Impro

  18. Slide 18: Sea Based operational agenda

    Sea Based operational agenda  Demand for technology and solutions will outpace growth in salmon production  Market demands solutions where hardware and software are integrated  Continuous repricing of customer quotations to reflect the inflationary environment  ESG considerations are being imple

  19. Slide 19: Key digital trends in Aquaculture - Fusing

    Key digital trends in Aquaculture - Fusing Remote Land based Operations Farming Digital Products & Precision Fish Services Farming Sea Based Business Farming Ecosystem Pioneering a better future

  20. Slide 20: Current digital solutions

    Current digital solutions Pioneering a better future

  21. Slide 21: Digital – Strengthened Capabilities

    Digital – Strengthened Capabilities  Digital Leadership  Product Management  Architecture and Innovation disciplines  UX and Front-End Developers  Digital Business Development  Acquisition of 33,67% stake in Observe Technologies Pioneering a better future

  22. Slide 22: Medium term targets

    Medium term targets Long term organic Operational Deliver min. 8% EBIT Innovation spending 3 Digital platforms: topline growth of excellence and in 2024 to support new AKVA Connect, min. 10% Y-o-Y cost saving Product development AKVA Observe and programs Step by step improve and Organic growth AKVA

  23. Slide 23: Agenda Q2 2022

    Agenda|Q2 2022 Introduction and Financial Q&A Highlights Performance Session Pioneering a better future

  24. Slide 24: Q2 2022 – Income statement

    Q2 2022 – Income statement  Record high activity and revenue increased by MNOK 76 compared to Q2 21  EBIT decreased by MNOK 74 from MNOK 32 in Q2 21 to MNOK -41 in Q2 22  Profitability negatively impacted by high inflation rates and cost provisions of estimated MNOK 102 in the Q2  Financial item

  25. Slide 25: Revenue development

    Revenue development  Last twelve months order intake and revenue of MNOK Revenue (MNOK) 3,233 and MNOK 3,327, respectively 907 832 833 849  Revenue increased by 9% compared to Q2 22 738  Increased activity in all three business segments in Q2 22 compared to Q2 21 Q2 21 Q3 21 Q4 21 Q1 22 Q2 22 Pio

  26. Slide 26: Revenue by Market and Segment

    Revenue by Market and Segment Revenue by Market* (MNOK) Revenue by Segment (MNOK) 907 907 849 26 832 833 832 833 849 53 18 21 21 145 21 64 97 738 61 116 151 738 20 161 133 19 102 151 115 149 100 198 130 156 144 716 736 650 676 603 548 584 541 AustralAsia 427 465 Europe & Middle East Digital Americas

  27. Slide 27: EBITDA and EBIT development

    EBITDA and EBIT development  EBITDA of MNOK 3 / 0,4% in Q2 22 EBITDA EBIT 6,9% 120,0 13,0 12,1% 120,0 7,0  Challenging profit margins in the quarter 110,0 12,0 6,0 10,7% due to cost provisions and negative 100,0 11,0 100,0 4,4% 5,0 impact for the high inflation rates 90,0 9,5% 10,0 80,0 3,9% 4,0 9

  28. Slide 28: Cash flow and financial position

    Cash flow and financial position Available cash Net Working capital Net debt / EBITDA* 13,6% 4,45 700 600 14 1 800 4,55 637 12,6% 13 4,10 603 12,1% 12,1% 3,94 4,20 11,6% 1 600 600 561 500 12 3,85 454 11 1 400 3,50 500 409 10 1 252 1 204 400 375 1 200 3,09 3,15 368 362 9 3,02 1 093 2,80 400 8 1 000 9

  29. Slide 29: Development return on capital employed

    Development return on capital employed ROACE* (%)  ROACE decreased from 7,8% in Q1 22 to 3,7% in 15 Q2 22  Target of minimum 15% in 2024 10 15,0% 5 7,7% 7,8% 6,3% 6,7% 3,7% 0 Q2 21 Q3 21 Q4 21 Q1 22 Q2 22 2024 target  ROACE is calculated with the average balance sheet items last four quarters  R

  30. Slide 30: Dividend

    Dividend  A dividend of NOK 1 per share was paid in Q1 2022 Cash dividend (NOK per share)  Due to the challenging first half year of 2022 the company has decided not to pay any dividend in the second half of 2022 1,75 1,50 1,00 1,00 1,00 2018 2019 2020 2021 Q1 2022 Pioneering a better future

  31. Slide 31: Business segments

    Business segments Pioneering a better future

  32. Slide 32: Sea Based Technology

    Sea Based Technology • Total revenue increased by 3% Revenue (MNOK) and EBITDA-margin (%) • Order intake reduced from MNOK 735 in Q2 21 to MNOK 704 in Q2 22 1 000 14 13,3% 13 900 Nordic 12 • Revenue decreased by 7% in Q2 22 compared to Q2 21 800 736 11 716 • Total order intake of MNOK 475 and 7% hig

  33. Slide 33: Development OPEX based revenue

    Development OPEX based revenue  Recurring revenue was MNOK 4 lower in Q2 22 compared Revenue (MNOK) to Q2 21 39,5% 300 40 • Adjusted for the sale of AKVA Marine Services (Q3 21) the recurring revenue increased by MNOK 22 35 250 31,4% 31,3% 30,0% 30 27,5% 200 25 150 20 238 225 221 15 100 204 186 10

  34. Slide 34: Land Based Technology

    Land Based Technology Revenue (MNOK) and EBITDA-margin (%)  Order intake of MNOK 96 in the quarter compared to MNOK 116 in Q2 21 150 145 3 0  Revenue increased by 50% in Q2 22 compared to Q2 21 97 100  Progress according to plan on the full grow out project for Nordic 2 0 Aqua Partners in China 1

  35. Slide 35: Digital

    Digital Revenue (MNOK) and EBITDA-margin (%)  Revenue increased by 40% in Q2 22 compared to Q2 21 50 25  Reduced EBITDA margin related to ramp-up of organization and 45 22,3% investment in digital capabilities 40 20 35 17,8% 30 15 26 25 1 20 18 9 10 1 15 6 EBITDA % 10 5 16 Europe&Middle East 5 11

  36. Slide 36: Outlook

    Outlook Pioneering a better future

  37. Slide 37: Outlook

    Outlook  Salmon prices expected to remain strong driven by reduced supply. On the other hand, uncertainty related to supply chain restrictions and cost inflations may impact the profitability  Order backlog is solid and forms a good foundation to execute our organic growth strategy  Targeting min

  38. Slide 38: Disclaimer

    Disclaimer  All opinions and statements in this notice are, regardless of source, given in good faith, and may only be valid as of the stated date of this notice and may be subject to change without notice. AKVA group has taken all reasonable steps to ensure that the information contained in this n

  39. Slide 39: Appendix

    Appendix Pioneering a better future

  40. Slide 40: Overview slide

    Overview slide Leading Listed on Deliveries in Companies in technology Oslo stock 65 countries 11 countries. and service exchange over 40 years 1 488 partner since 2006 employees Pioneering a better future

  41. Slide 41: Our presence

    Our presence AKVA group Pioneering a better future

  42. Slide 42: Solutions

    Solutions Sea Based Land Based Digital Pioneering a better future

  43. Slide 43: Revenue by species

    Revenue by species Revenue by Species (MNOK) 907 849 24 832 833 61 41 51 60 65 738 60 40 49 64 822 725 722 749 625 Non seafood Other species Salmon Q2 21 Q3 21 Q4 21 Q1 22 Q2 22 Pioneering a better future

  44. Slide 44: Balance sheet

    Balance sheet CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION Note 2022 2021 2021 (NOK 1 000) 30.6. 30.6. 31.12. Intangible fixed assets 1,3 970 345 1 043 641 934 157 Deferred tax assets 16 203 2 352 11 229 Tangible fixed assets 637 712 713 262 642 568 Long-term financial assets 340 811 179 5

  45. Slide 45: Cash flow statement

    Cash flow statement CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW 2022 2021 2022 2021 2021 (NOK 1 000) Q2 Q2 YTD YTD Total Cash flow from operating activities Profit before taxes -54 206 14 004 -6 837 -16 686 2 549 Taxes paid -10 614 -4 195 -20 879 -12 658 -34 683 Share of profit(-)/loss(+) from ass

  46. Slide 46: Largest shareholders

    Largest shareholders 20 largest shareholders Share development No of shares % Account name Type Citizenship 18 703 105 51,0 % EGERSUND GROUP AS NOR 6 600 192 18,0 % Israel Corporation Ltd ISR 1 470 262 4,0 % PARETO AKSJE NORGE VERDIPAPIRFOND NOR 996 788 2,7 % SIX SIS AG Nominee CHE 923 816 2,5 % VER

  47. Slide 47: Dividend policy

    Dividend policy  The company is aiming to give the shareholders a competitive return on investment by a combination of cash dividend and share price increase  The company’s dividend policy shall be stable and predictable  When deciding the dividend, the Board will take into consideration expected

  48. Slide 48: Pioneering a better future

    CUSTOMER FOCUS AQUACULTURE 3% KNOWLEDGE RELIABILITY ENTHUSIASM! Pioneering a better future AKVAcrour

  49. Slide 49: Pioneering a better future

    Pioneering a better future AKVAcrRour

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