Slide 1: Q4 2022 Presentation
Q4 2022 PRESENTATION 8 February 2023
Slide 2: Disclaimer
DISCLAIMER This presentation (the “Presentation”) has been prepared by Salmon Evolution ASA (the “Company” and together with is subsidiaries, the “Group”) except where context otherwise requires, solely for information purposes. This Presentation, and the information contained herein, does not const
Slide 3: Agenda
Agenda • Highlights • Extending the ocean potential™ • Operations • Financials • Summary and outlook • Appendices 3 Q4 2022 Presentation
Slide 4: Q4 2022 Highlights
Q4 2022 HIGHLIGHTS Q4 2022 • Batch 1 fully harvested out with very strong results – harvest volume of ~340 tonnes HOG at avg. weight of ~3.75 kg HOG (~4.5 kg LW) – excellent product quality confirmed by industry leading superior share of 96% • On track for profitable farming operations in Q2 2023 an
Slide 5: Agenda
Agenda • Highlights • Extending the ocean potential™ • Operations • Financials • Summary and outlook • Appendices 5 Q4 2022 Presentation
Slide 6: Salmon Evolution at a Glance
SALMON EVOLUTION AT A GLANCE Company overview Salmon farming facilities ▪ Established in 2017 Indre Harøy Yangyang ▪ Based in Hustadvika, strategically located on the west coast of Norway ▪ Listed on main list at Oslo Stock Exchange in 2021 ▪ Market capitalization of USD ~300m 49% ownership ▪ Highly
Slide 7: Agenda – Operations Norway
Agenda • Highlights • Extending the ocean potential™ • Operations – Norway • Financials • Summary and outlook • Appendices 10 Q4 2022 Presentation
Slide 8: Batch 1 Fully Harvested Out During Q4 2022 With Very Strong Results
BATCH 1 FULLY HARVESTED OUT DURING Q4 2022 WITH VERY STRONG RESULTS Comments Harvest weight distribution (HOG) 70% • Total batch 1 harvest volumes of ~340 tonnes HOG at an average weight of ~3.75 kg HOG (~4.5 kg LW) 60% Share of harvest (%) • Harvest spread over 3 harvesting rounds from early 50% No
Slide 9: Our Salmon Well Received in the Market
OUR SALMON WELL RECEIVED IN THE MARKET World premiere – from local to global Selected customer feedback “Presentation of fillets – excellent, colour, trim, no gaping, no black spots (exactly how the conventional product comes in). Local Taste – excellent , no off flavour, very clean taste, no fishy
Slide 10: Continuing Production Ramp Up
CONTINUING PRODUCTION RAMP UP NEW ALL-TIME HIGH BIOMASS PRODUCTION AT INDRE HARØY Comments Net biomass growth (LW) and harvest volumes (HOG) 250 1 250 • New all-time high biomass production at Indre Harøy in January with ~225 tonnes 225 Net biomass growth (tonnes, LW) 200 1 000 Total biomass (tonnes
Slide 11: Continued Very Low Mortality Levels
CONTINUED VERY LOW MORTALITY LEVELS CONFIRMATION OF GOOD AND STABLE WATER QUALITY Accumulated mortality since stocking (%) 6,00 Accumulated total mortality (%) 5,00 4,00 3,00 2,00 Minor first smolt Fish transfer – sorted transfer issues into two groups 1,00 0,00 0 30 60 90 120 150 180 210 240 Days s
Slide 12: Group Biomass Overview
GROUP BIOMASS OVERVIEW Group biomass development 31 December 2022 31 January 2023 Biomass Biomass Batch Units (#) Weight (g) Units (#) Weight (g) Comments (tonnes) (tonnes) Split into two groups with average weight Batch #2 ~228,000 ~1,875 428 ~228,000 ~2,375 540 of 2.6 kg and 2.15 kg, respectively
Slide 13: Significant Opportunity to Unlock Long-Term Potential at Indre Harøy
SIGNIFICANT OPPORTUNITY TO UNLOCK LONG-TERM POTENTIAL AT INDRE HARØY Short term target Focus areas Long-term target Implications Optimizing Achieve steady state production Capturing built-in production of 7,900 upside potential in Improved profitability tonnes HOG Feed production plan Strongly suppo
Slide 14: Phase 1 Project Update
PHASE 1 PROJECT UPDATE • All buildings and structural facilities completed • 8 out of 12 tanks taken over with remaining 4 tanks to be taken over in February and March • Work at site now mainly focused on commissioning and testing of remaining tanks and connecting technical rooms • On track for phas
Slide 15: Agenda – Operations International
Agenda • Introduction • Extending the ocean potential™ • Operations – International • Financials • Summary and outlook • Appendices 18 Q4 2022 Presentation
Slide 16: K Smart Farming – Focus on Engineering and Permits
K SMART FARMING – FOCUS ON ENGINEERING AND PERMITS • K Smart JV with Dongwon Industries formalized end of March Illustration – Yangyang on-growing site 2021 • Ownership split 49/51% for SE and Dongwon, respectively. Dongwon to facilitate 75% debt financing • Good progress on design and engineering a
Slide 17: North America – Building Pipeline for Future Growth
NORTH AMERICA – BUILDING PIPELINE FOR FUTURE GROWTH Comments Tentative timeline • Evaluating selected potential production sites 2022 2023 2024 2025 2026 2027 2028 in North America, both on the west and east coast Site selection and initial due diligence • Current focus is centred on site selection
Slide 18: Agenda
Agenda • Highlights • Extending the ocean potential™ • Operations • Financials • Summary and outlook • Appendices 21 Q4 2022 Presentation
Slide 19: Farming Costs Trending the Right Way
FARMING COSTS TRENDING THE RIGHT WAY ON TRACK FOR PROFITABLE FARMING OPERATIONS IN Q2 2023 Farming segment key figures Q4 2022 Farming EBITDA cost (NOK/kg HOG)* 30 0 90 25 80 -5 -11,8 20 70 NOK/kg HOG NOK/kg HOG 15 -10 60 26,8 NOKm 10 20,4 -27,7 50 -15 5 40 79 0 -20 30 56 -5 -9,4 -2,9 -25 20 -10 10
Slide 20: Group Profit & Loss
GROUP PROFIT & LOSS Summary of result (figures in NOK 1000) Note Q4 2022 Q4 2021 2022 2021 Revenue from contracts with customers 2 26,814 0 46,107 12,047 • NOK 46.1m in customer revenues for 2022 Other income 1,594 5 1,574 209 relating to both external smolt sales and sale Total operating income 28,
Slide 21: Indre Harøy Phase 1 Capex
INDRE HARØY PHASE 1 CAPEX Comments Accumulated Indre Harøy phase 1 CAPEX (NOKm) • Q4 2022 capex of NOK 115m1) Capitalized internal G&A Investments (Indre Harøya) • Accumulated capex of NOK 1,578 million from 1 688 project initiation in 2019 compared to guiding of Land 110 phase 1 completion capex of
Slide 22: Continuing Indre Harøy Phase 2 Preparations
CONTINUING INDRE HARØY PHASE 2 PREPARATIONS • Continuing phase 2 preparations – focus on implementing learning effects from phase 1 and identifying Phase 2 cost savings • Completed blasting and excavation works for water intake station for both phase 2 and phase 3 • Clear signs of normalization of c
Slide 23: Fully Funded for Committed Projects
FULLY FUNDED FOR COMMITTED PROJECTS IN ADVANCED DISCUSSIONS FOR FAVOURABLE PHASE 2 BANK DEBT FINANCING • Currently in advanced Existing funding discussions with banks for new debt financing package including phase 2 121 • New debt financing package expected to include: 400 ➢ Re-financing of phase 1
Slide 24: Agenda
Agenda • Highlights • Extending the ocean potential™ • Operations • Financials • Summary and outlook • Appendices 27 Q4 2022 Presentation
Slide 25: Roadmap to 100,000 Tonnes HOG
ROADMAP TO 100,000 TONNES HOG 2020 2022 2024 2026 2028 2030 2032 NORWAY 31.5kt Indre Harøy based on current licenses Phase 1 Phase 2 Phase 3 7.9kt 7.9kt 15.7kt ++ 31.5kt+ ASIA South Korea South Korea phase 1 phase 2 ++ 8.4kt 8.4kt 16.8kt+ North America North America 31.5kt+ ++ 31.5kt+ TOTAL 100kt 28
Slide 26: Summary & Outlook
SUMMARY & OUTLOOK • Proof of concept – batch 1 fully harvested out with very strong results – excellent product quality confirmed by industry leading superior share of 96% • On track for profitable farming operations in Q2 2023 • Continued strong biological performance with minimal mortality – batch
Slide 27: Q&A
Q&A www.salmonevolution.no 30 Q4 2022 Presentation
Slide 28: Agenda
Agenda • Introduction and highlights • Extending the ocean potential™ • Operations • Financials • Summary and outlook • Appendices 31 Q4 2022 Presentation
Slide 29: Strong management team with extensive experience leading a growing organization
Strong management team with extensive experience leading a growing organization and corporation Management team Organizational structure Corporate structure Trond Håkon Schaug-Pettersen CEO | CFO ▪ >15 years experience from both salmon About 60 FTEs across the Group industry and capital markets nota
Slide 30: Highly competent board of directors backed by strong owners
Highly competent board of directors backed by strong owners Board of directors Ownership as per 31 December 2022 Tore A. Tønseth Eunhong Min Ownership Board Shareholders Comments Chairman of the board Board member share representative ▪ Investment Director at Ronja ▪ Chief Executive Officer of Owned