Gigante Salmon As · OSL:GIGA
Gigante Salmon As — Investor Presentation (October 2023)
37 slides from Gigante Salmon As's investor presentation, Oct 11, 2023
Slide 1: Gigante Salmon Investor Presentation
GIGANTE SALMON INVESTOR PRESENTATION 11 October 2023 Private and confidential
Slide 2: Disclaimer and Important Information
DISCLAIMER AND IMPORTANT INFORMATION THIS DOCUMENT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN FORM PART OF ANY PUBLIC OFFER OF SECURITIES AND NO ONE HAS TAKEN ANY ACTION THAT WOULD PERMIT A PUBLIC OR INTO OR FROM THE UNITED STATES OF AMERICA, ITS
Slide 3: Table of Contents
TABLE OF CONTENTS 4 INTRODUCTION 5 COMPANY OVERVIEW 16 CAPEX UPDATE 19 BUSINESS PLAN 24 RISK FACTORS 33 APPENDIX 3
Slide 4: Updated Project Summary
UPDATED PROJECT SUMMARY INTRODUCTION BACKGROUND THE PROJECT ECONOMICS REMAIN STRONG AND HIGHLY COMPETITIVE: ▪ Gigante Salmon is constructing a land-based salmon farming site on Lille Indre Rosøy PRODUCTION COSTS1 CAPEX which has a yearly production capacity of up to 16.000 tonnes HOG, based on a NOK
Slide 5: Company Overview
COMPANY OVERVIEW
Slide 6: Investment Highlights
COMPANY OVERVIEW INVESTMENT HIGHLIGHTS ▪ Developed by a family-owned traditional salmon farmer. EXPERIENCE ▪ Gigante Havbruk AS (“Gigante Havbruk”) has 30 years of experience of successful salmon farming. ▪ Experienced management and operational team in place. ▪ Design builds on technology proven in
Slide 7: Progress and Milestones
COMPANY OVERVIEW PROGRESS AND MILESTONES The Norwegian Ministry of Rødøy Municipality approves the Fisheries lifted the requirement rezoning from agricultural and natural for licenses for land-based areas (LNF) to industrial use for land- aquaculture facilities in based aquaculture. Norway. The work
Slide 8: Gigante Salmon Uses Flow-Through Technology
COMPANY OVERVIEW GIGANTE SALMON USES FLOW-THROUGH TECHNOLOGY Each production pool is equipped with respectively 4, 3, and 3 raceways (A). Each raceway measures between 110 and 214 meters in length and is furnished with a longitudinal partition (B), allowing water to circulate from one side to the ot
Slide 9: On Track for First Harvest in Q4-2024
COMPANY OVERVIEW ON TRACK FOR FIRST HARVEST IN Q4-2024 2021 2022 2023 2024 2025 2026 2027 Project execution phase CONSTRUCTION Q3-23 Groundwork complete PHASE Q4-23 Grow-out basin completed Q3-24 Entire production plant completed Startup production – 1.1 mill smolt Harvest 5,300 tonnes HOG PRODUCTIO
Slide 10: Highly Experienced and Hands-On Board of Directors
COMPANY OVERVIEW HIGHLY EXPERIENCED AND HANDS-ON BOARD OF DIRECTORS GIGANTE SALMON RØDØY AS GIGANTE SALMON AS KRISTIN LIV MONICA TOR-ARNE KRISTIAN INGEBRIGTSEN STUBHOLT EIRIK SØRGÅRD KJELL LORENTSEN GRANSJØEN DAGFINN ELIASSEN LORENTSEN BOARD MEMBER BOARD MEMBER CHAIR OF THE BOARD BOARD MEMBER BOARD
Slide 11: Key Personnel with Extensive Experience
KEY PERSONNEL WITH EXTENSIVE EXPERIENCE IN CONSTRUCTION AND COMPANY OVERVIEW PROJECT MANAGEMENT, STRATEGIC COMMUNICATION AND AQUACULTURE HELGE ALBERTSEN RUNE JOHANSEN LINDA STORHOLM KRISTINE ØDEGÅRD KRISTIAN AANES ARVE STORHOLM CEO CFO CCO CQO Site manager Project manager ▪ Extensive experience with
Slide 12: First Conventional Salmon Farmer to Initiate Large Scale Land-Based Project
GIGANTE HAVBRUK IS THE FIRST CONVENTIONAL SALMON FARMING COMPANY OVERVIEW COMPANY TO INITIATE A LARGE SCALE LAND-BASED SALMON PROJECT HOW IT ALL STARTED I have been a salmon farmer since the 1980s and have been through all the ups and downs this industry has been through. From the start, with small
Slide 13: Strong Backing from Leading Salmon Farmer Gigante Havbruk
COMPANY OVERVIEW STRONG BACKING FROM LEADING SALMON FARMER GIGANTE HAVBRUK IN BRIEF FINANCIAL DEVELOPMENT MNOK ▪ The largest owner in Gigante Salmon is Gigante Havbruk, with 51% direct 1.127 ownership. 974 ▪ Gigante Havbruk has its operations in Nordland, and the majority of the group's involvement
Slide 14: Access to a Fully Integrated Value Chain
COMPANY OVERVIEW GIGANTE SALMON HAS ACCESS TO A FULLY INTEGRATED VALUE CHAIN BROODSTOCK SMOLT PRODUCTION WELL BOAT HARVEST EXPORT AND BREEDING Gigante Salmon has access to the fully established value chain within the Gigante group. The smolt that is to be reared in the new facility is already growin
Slide 15: Large Proportion of Shareholders Are Industrial
A LARGE PROPORTION OF THE COMPANY’S SHAREHOLDERS ARE INDUSTRIAL COMPANY OVERVIEW SHAREHOLDERS FROM THE AQUACULTURE INDUSTRY # Shareholders as of 03/10/23 # shares % of top 20 % total total DISTRIBUTION OF SHAREHOLDERS 1 GIGANTE HAVBRUK AS 54,238,000 57.55 % 51.38 % Private 2 KAPNORD AS1 17,272,728 1
Slide 16: Capex Update
CAPEX UPDATE
Slide 17: Majority of Capex Increase Directed to Efficiency and Robustness
MAJORITY OF CAPEX INCREASE DIRECTED TO INCREASE EFFICIENCY AND ROBUSTNESS CAPEX UPDATE OVERVIEW ADDITIONAL INVESTMENTS SPLIT MNOK CAPEX Increase 35 % MNOK 200 Design improvement 65 % COMMENTS Original Updated Additional Capex Design CAPEX Category budget prognosis investments increase improvement Ma
Slide 18: Capex Still Favorable Compared to Other Land Based Projects
CAPEX STILL FAVORABLE COMPARED TO OTHER LAND BASED PROJECTS AND NEW CAPACITY IN CONVENTIONAL FARMING CAPEX UPDATE CAPEX PER KG HOG COMMENTS NOK 350 ▪ Compared to current development stages in other land-based projects, Gigante Salmon’s CAPEX per kg HOG is significantly lower even 200-300 300 when th
Slide 19: Business Plan
BUSINESS PLAN
Slide 20: Fully-Funded to Produce 16,000 Tonnes After Capital Raise
FULLY-FUNDED TO PRODUCE 16,000 TONNES AFTER CAPITAL RAISE BUSINESS PLAN PHASE 1 FULL PRODUCTION INVESTMENT: MNOK 645 No additional investments required SMOLT RELEASED: 1,100,000 3,300,000 HARVEST (TONNES, WFE): 6,350 19,050 HARVEST (TONNES, HOG): 5,300 16,000 UTILISATION MAB: 0.5x 1.4x PROD. COST NO
Slide 21: Favorable Salmon Price Development in Recent Years
FAVORABLE SALMON PRICE DEVELOPMENT IN RECENT YEARS BUSINESS PLAN SALMON PRICE (FPI) COMMENTS NOK/kg 140 ▪ The average weekly salmon price has been 69 NOK/kg over the past 5 years. 130 ▪ In the last couple of years, the average 120 weekly salmon price has increased to 85 NOK/kg and there have also be
Slide 22: Production Costs Competitive Even with 1/3 Production Volume
PRODUCTION COSTS ARE COMPETITIVE EVEN WITH 1/3 PRODUCTION VOLUME BUSINESS PLAN OPERATING COSTS PER KG HOG2 COMMENTS NOK ▪ Assumed feed conversion and mortality rates per generation are 1.10 and 10 % respectively. 60 3 ▪ When comparing Gigante Salmon and 55 traditional aquaculture, one of the 6 3 maj
Slide 23: Illustrative Financial Calculations with Different Price and Cost Assumptions
ILLUSTRATIVE FINANCIAL CALCULATIONS WITH DIFFERENT PRICE AND COST ASSUMPTIONS BUSINESS PLAN EBIT SENSITIVITY AT 1/3 PRODUCTION EBIT SENSITIVITY AT FULL PRODUCTION MNOK MNOK 1.101 1.035 969 941 875 809 781 715 291 649 261 621 238 232 555 208 489 461 185 179 395 155 132 329 126 102 79 73 49 20 Salmon
Slide 24: Risk Factors
RISK FACTORS
Slide 25: Risk Factors (1/8)
RISK FACTORS (1/8) RISK FACTORS Investing in the Company and its shares involves inherent and significant risks, and an investment in the Company and its shares is suitable only for investors who understand the risks associated with this type of investment and who can afford a loss of all or part of
Slide 26: Risk Factors (2/8)
RISK FACTORS (2/8) RISK FACTORS Land based salmon farming is a new industry subject to inherent risks Land based salmon farming is a fairly new industry and, as a consequence, experience with land based salmon farming has been developing rapidly due to practical implementation of research taking pla
Slide 27: Risk Factors (3/8)
RISK FACTORS (3/8) RISK FACTORS Aquaculture is vulnerable to errors in technology, production equipment and maintenance routines Aquaculture as an industry is vulnerable to errors in technology, production equipment and maintenance routines. Such errors could cause damage to production and biomass,
Slide 28: Risk Factors (4/8)
RISK FACTORS (4/8) RISK FACTORS Risks related to feed costs and supply Feed costs are expected to account for a significant portion of the Group's total production costs, and an increase in feed prices could thus have a major impact on the Group's future profitability. The feed industry is character
Slide 29: Risk Factors (5/8)
RISK FACTORS (5/8) RISK FACTORS Fluctuations in salmon prices could have an adverse impact on the Group's business and its financial position The Group’s financial position and future prospect are dependent on the price of farmed salmon, which has historically been subject to substantial fluctuation
Slide 30: Risk Factors (6/8)
RISK FACTORS (6/8) RISK FACTORS Changes in tax laws of any jurisdiction in which the Company operates, and/or any failure to comply with applicable tax legislation may have a material adverse effect for the Company Further, any changes in applicable tax laws and regulations could negatively affect t
Slide 31: Risk Factors (7/8)
RISK FACTORS (7/8) RISK FACTORS Environmental risks The Group’s operations are subject to environmental requirements which govern, among other matters, air pollution emissions, wastewater discharges, solid and hazardous waste management, and the use, composition, handling, distribution and transport
Slide 32: Risk Factors (8/8)
RISK FACTORS (8/8) RISK FACTORS Additionally, the Company’s general meeting may deviate from the shareholders’ pre-emptive right to subscribe for shares and other securities. Securities laws in certain jurisdictions may moreover prevent the Company’s shareholders belonging to such jurisdictions from
Slide 33: Appendix
APPENDIX
Slide 34: All Necessary Personnel in Place to Start Production
ALL NECESSARY PERSONNEL IN PLACE TO START PRODUCTION IN Q4 2023 APPENDIX ORGANISATION OVERVIEW COMMENTS ▪ Gigante Salmon has all the neccessary MANAGEMENT AND SUPPORT resources to start production in Q4 FUNCTIONS 2023. ▪ The company has proven to be an attractive employer that has managed to fill te
Slide 35: Company Structure
COMPANY STRUCTURE APPENDIX 100 % 59 % 16 % 51 % 100 % 100 % 100 % 5% 34 % 50,2 % 100 % 100 % 65 % 100 % 100 % 98 % 51 % 20 % 15 % 81 % 55 % 40 % 100 % 51 % 51 % 76 % 35
Slide 36: Illustration of EBIT When Changing Selected Cost Items and Salmon Price
ILLUSTRATION OF EBIT WHEN CHANGING SELECTED COST ITEMS AND SALMON PRICE APPENDIX CHANGE IN EBIT AT 1/3 PRODUCTION CHANGE IN EBIT AT FULL PRODUCTION MNOK MNOK EBIT (MNOK) EBIT (MNOK) 0 20 40 60 80 100 120 140 160 200 300 400 500 600 700 Sales price (60-80 NOK/kg) 26 132 Sales price (+/-30%) 301 621 F
Slide 37: Slide 37
Gigante Salmon AS — Investor Presentation (October 2023) on 6ix