Akva Group Asa · OSL:AKVA
Akva Group Asa — Q1 2018 Earnings Presentation
42 slides from Akva Group Asa's earnings presentation, May 16, 2018
Slide 1: Q1 2018 Presentation
Q1 2018 Presentation Oslo – May 16th 2018 Hallvard Muri, CEO Simon Nyquist Martinsen, CFO
Slide 2: Agenda
Agenda Highlights Financial performance Outlook Q&A
Slide 3: Highlights Q1 2018 – by CEO Hallvard Muri
Highlights Q1 2018 – by CEO Hallvard Muri
Slide 4: Continued growth in order intake
Continued growth in order intake Order intake • Overall order intake up 8 % compared to Q1 2017 +8% 778 48 • Strong quarter for new orders in the Nordic region with Helgeland Plast and ASA Nordic as the main contributors 639 589 557 45 SW 561 303 546 33 533 51 51 LBT • Americas continues the strong
Slide 5: High activity across all regions
High activity across all regions Revenue • 16% increase in revenue compared to Q1 2017 +16% • Europe & Middle East more than doubled the revenue from Q1 2017, with ASA Export and AKVA group Scotland as the main contributors. Several large deliveries to Russia in the quarter • As for Q4 2017, another
Slide 6: Operational leverage taking effect
Operational leverage taking effect EBITDA • EBITDA up 10 % compared to Q1 2017 • EBITDA margin of 10.0 %, down from 10.6 % in Q1 2017, +10% driven by changes in mix/revenue composition • Europe & Middle East ends a strong quarter with an EBITDA of 10 MNOK, up from 6.9 MNOK last year 65 61 60 59 • La
Slide 7: Eleventh quarter in a row with growth in order backlog
Eleventh quarter in a row with growth in order backlog Order backlog • First quarter 2018 – Highlights +33% 1 430 1 380 1 381 – Strong platform for further positive development 1 318 1 077 479 998 537 629 – Order backlog end of March of 1.43 BNOK 886 620 822 430 412 417 – EBITDA of 59 MNOK in the qu
Slide 8: Operational leverage and profitable growth
Operational leverage and profitable growth Revenue EBITDA EPS +81% +119% +114% 589 59 0,94 510 54 0,77 393 40 325 27 0,44 0,45 2015 2016 2017 2018 2015 2016 2017 2018 2015 2016 2017 2018 Q1 Q1 Q1
Slide 9: Where do we deliver
Where do we deliver AKVA group’s geographical regions Income distribution Q1 2018 20%(12%) 18%(7%) 62%(81%) Nordic Americas Export Nordic AKVA group EME Agents and Distributors Americas
Slide 10: Development in OPEX based revenue
Development in OPEX based revenue 150 35 30,6% 28,3% 29,0% 30 • The Marine Service business in Chile has started with plans to 27,1% 26,1% 24,7% grow this segment going forward 23,4% 25 100 22,1% • Continued good development for the rental business in Scotland 20 in 2018 146 140 145 127 130 15 • Mar
Slide 11: Revenue by product group and species
Revenue by product group and species By product groups – Q1 2018 By species – Q1 2018 589 589 557 537 557 34 537 47 510 46 1 510 28 32 52 41 41 1 484 0 108 30 54 484 54 449 1 38 449 37 408 112 0 124 408 52 40 38 Software 32 1 354 0 84 83 82 46 Non seafood 57 354 44 LBT S&AS 77 95 33 78 104 99 Other
Slide 12: Q1 – Operational Highlights
Q1 – Operational Highlights • Development in Americas and Chile is still very positive • Positive improvements in Russian market into 2018 • Pipeline of post smolt projects still strong in Norway and other markets, but decisions are slow • Increased focus on the Mediterranean markets for Bass and Se
Slide 13: Group Strategy
Group Strategy Focused growth and Operational expansion excellence Increased international focus Improvement programs within sourcing, Land based post smolt logistics and manufacturing Expand services and OPEX based Streamline project execution and service business delivery Product portfolio add-ons
Slide 14: Atlantis Subsea Farming license process
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
Slide 15: Financial performance Q1 2018 – by CFO Simon Nyquist Martinsen
Financial performance Q1 2018 – by CFO Simon Nyquist Martinsen
Slide 16: Q1 2018 – Financial highlights
Q1 2018 – Financial highlights Revenue 589 557 • 16% growth, a new quarter with strong contributions 537 510 from Americas, Land Based and Europe & Middle East 484 449 393 402 408 • Last twelve months order intake and revenue now at 355 354 344 325 2,521 MNOK and 2,167 MNOK respectively • The order
Slide 17: Q1 2018 – Financial highlights
Q1 2018 – Financial highlights 80 EBITDA (MNOK) • Sperre is a strong contributor to EBITDA with a total of 8 65 61 59 60 60 54 MNOK in the quarter 40 41 43 41 38 40 27 27 24 20 • The entities in the Americas region had another strong quarter with an EBITDA of 6 MNOK, more than four times 0 Q1 Q2 Q3
Slide 18: Cage Based Technologies
Cage Based Technologies Nordic • Sperre is ending the quarter with an EBITDA of 8.2 MNOK, compared Revenue and EBITDA % to 4.4 MNOK in Q1 2017 450 434 14 • ASA Nordic on same level as in 2017 in terms of EBITDA 400 385 • Lower activity and implementation of new manufacturing lines in 11,0% 104 12 He
Slide 19: Land Based Technologies
Land Based Technologies Revenue and EBITDA % • Low order intake in the quarter as 110 109 10 decisions have been postponed 6 100 8,1% 8,5% 90 8 • Several good project opportunities both in 85 4 Norway, Scotland and Chile for Q2/Q3 80 6 70 • Revenue increases as projects in the order 103 60 book are
Slide 20: Software
Software Revenue and EBITDA % • AKVA group Software ends the quarter 60 30 with an EBITDA of 3.5 MNOK compared 55 to 2.9 MNOK in Q1 2017 50 22,2% 47 1 20 45 41 5 • Wise Ehf ends the quarter with an 40 12,0%1 EBITDA of 5.8 MNOK compared to 1.9 3 35 10 MNOK in the same quarter in 2017 30 • A sale of s
Slide 21: Financials – Detailed P&L
Financials – Detailed P&L (MNOK) 2018 2017 2018 2017 2017 Q1 Q1 YTD YTD Total Order backlog 1 430 1 077 1 430 1 077 1 381 Order intake 639 589 639 589 2 471 • Of which Land Based is 479 MNOK P&L OPERATING REVENUES 589 510 589 510 2 088 • Increased depreciation mainly due to Operating costs ex deprec
Slide 22: Group financial profile – remains strong
Group financial profile – remains strong Available cash Working capital Average working capital 175 180 8,4% 9 150 8 135 137 160 7,5% 8,8% 8 7,7% 124 6,5% 6,3% 7 6,8% 6,7% 122 115 7,1% 7,2% 102 140 131 127 7 106 107 6 6,2% 5,5% 100 118 5,8% 98 120 6 100 85 5,0% 109 5,7% 5 5,3% 100 4,3% 5 4 462 80 4
Slide 23: CAPEX
CAPEX (TNOK) CAPEX and CAPEX/Sales % CAPEX breakdown 2018 90 000 14,2% 15 Rental 80 000 837 Intangible 70 000 11,2% 6 152 60 000 10 50 000 6,9% 40 000 5,9% 5,5% 5,9% 78 936 30 000 4,2% 57 368 4,0% 4,3% 5 20 000 31 666 10 000 23 114 24 407 24 728 25 517 18 529 17 067 19 495 0 0 Ordinary 1Q 2016 2Q 20
Slide 24: Net interest bearing debt/EBITDA of 1.3
Net interest bearing debt/EBITDA of 1.3 Net interest bearing debt (MNOK) and net debt/EBITDA Change in net interest bearing debt (TNOK) 400 2,0 2,10 Net interest bearing debt 31.12.2017 356 080 356 EBITDA -59 172 310 298 309 Income taxes paid 5 497 1,6 1,75 300 279 Net interest paid 2 926 1,5 1,5 1,
Slide 25: Group financial profile – remains strong, continued
Group financial profile – remains strong, continued Equity and Equity / Total Balance NIBD / Equity 520 40 0,8 500 0,71 500 38,9% 476 491 0,70 37,1% 473 0,7 480 38,9% 31,4% 0,63 0,63 460 435 446 29,4% 28,0% 30 0,58 0,6 460 31,6% 31,3% 437 30,1% 440 435 0,49 0,49 0,5 420 20 0,37 0,4 400 380 0,3 360 1
Slide 26: Group financial profile – remains strong, continued
Group financial profile – remains strong, continued ROCE ROACE 17,8% 18,6% 15,4% 16,5% 15,1% 16,5% 17,0% 14,0% 13,4% 14,6% 12,4% 13,2% 12,7% 11,1% 11,4% 10,9% 9,8% 9,6% 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 1Q18
Slide 27: Cash flow statement
Cash flow statement CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW 2018 2017 2018 2017 2017 (NOK 1 000) Q1 Q1 YTD YTD Total Net cash flow from operations 46 664 43 049 46 664 43 049 195 535 Net cash flow from change in w orking capital 45 546 -74 738 45 546 -74 738 -122 851 Net cash flow from operati
Slide 28: Balance sheet
Balance sheet BALANCE SHEET 2018 2017 2017 (MNOK) 31.03 31.03 31.12 ASSETS 1 755 1 425 1 663 Intangible non-current assets 589 573 596 Tangible non-current assets 251 189 246 Financial non-current assets 7 3 7 Inventory 247 204 238 Receivables 534 327 459 Cash and cash equivalents 127 131 117 LIABIL
Slide 29: Largest shareholders
Largest shareholders 20 largest shareholders Share development No of shares % Account name Type Citizenship 13 203 105 51,1 % EGERSUND GROUP AS NOR Last 12 months 3 900 000 15,1 % WHEATSHEAF INVESTMENT GBR Share price Trading volume 1 199 372 4,6 % VERDIPAPIRFONDET ALF NOR 100 50 000 000 525 414 2,0
Slide 30: Outlook – by CEO Hallvard Muri
Outlook – by CEO Hallvard Muri
Slide 31: AKVA group in brief
AKVA group in brief Leading Listed on Deliveries Companies technology Oslo stock in 65 in 11 and service exchange countries countries. partner since 2006 over 40 998 years employees
Slide 32: Solutions
Solutions Cage Based Technology Land Based Technology Software
Slide 33: CAPEX Based Revenue / OPEX Based Revenue
CAPEX Based Revenue OPEX Based Revenue
Slide 34: Order backlog and inflow, 2015 through 2018
Order backlog and inflow, 2015 through 2018 Order backlog Order intake 1 430 778 1 380 1 381 1 318 639 1 077 479 589 51 304 629 998 537 533 546 561 557 620 103 504 72 33 886 92 430 822 441 412 417 697 368 101 643 417 649 348 250 214 57 350 547 36 283 494 437 588 80 63 93 286 264 951 118 844 486 475
Slide 35: Outlook – AKVA group
Outlook – AKVA group • Continuing positive outlook for most markets • Land Based – focus on post smolt, high quote bank • Execution of improvement programs, manufacturing, sourcing and logistics • Increasing focus and growth outside Nordic Markets • Expanding services and OPEX based business, invest
Slide 36: AKVA group has signed LOI to acquire Egersund Net
AKVA group has signed LOI to acquire Egersund Net • The transaction is based on an enterprise value of 750 million NOK for all shares in Egersund Net AS • The seller, Egersund Group, will receive 70 % in shares in AKVA group and the remaining based on cash/debt assumption • In total, 7.5 million AKV
Slide 37: Egersund Net complement AKVA group's product offering
Egersund Net complement AKVA group’s product offering • Strategic transaction to become a more complete and innovative supplier – Further optimize the total system; cage, net and moorings – Offer more complete and efficient services – Optimize products’ life-cycle, including marine operations – More
Slide 38: Egersund Net overview
Egersund Net overview Products and Services Revenue and EBITDA Revenue composition • Nets and mooring solutions for the fish Revenue Adjusted EBITDA Products Services farming industry mNOK 10 - 15% • In addition to traditional fish farming 700 nets, Egersund offers top nets, tube nets 586 603 and sp
Slide 39: Egersund Net overview
Egersund Net overview Transaction scope Locations Egersund Net AS 100 % 100 % 50 % 50 % Egersund Trading UAB Egersund Net AS NOFI AS Emel Balik 70 % 33 % ~10 % 12 % Grading Systems Atlantis Subsea Blue Planet AS Blue Farm AS (UK) Ltd. Farming AS
Slide 40: Slide 40
Slide 41: Customer focus
CUSTOMER FOCUS AQUACULTURE % KNOWLEDGE RELIABILITY ENTHUSIASM!
Slide 42: AKVA group
AKVAcRovur