Slide 1: Q2 2022 presentation
Q2 2022 presentation CEO: Ivan Vindheim CFO: Kristian Ellingsen 24 August 2022
Slide 2: Forward looking statements
Forward looking statements This presentation may be deemed to include forward-looking statements, such as statements that relate to Mowi’s contracted volumes, goals and strategies, including strategic focus areas, salmon prices, ability to increase or vary harvest volume, production capacity, expect
Slide 3: Highlights
Highlights • All-time high Operational EBIT of EUR 320 million and record-high revenues of EUR 1.23bn • Salmon prices reached new record levels in all markets during the quarter on strong demand and global supply contraction • Blended farming cost of EUR 5.10 per kg, up from EUR 4.78 per kg in the f
Slide 4: Key financials
Key financials Mowi Group - main figures Q2 2022 Q2 2021 YTD Q2 2022 YTD Q2 2021 2021 Unaudited EUR million Operational revenue and other income 1,231.7 23% 1,000.3 2,327.1 2,022.7 4,207.6 Operational EBITDA 1) 363.1 178.2 612.0 329.5 690.3 Operational EBIT 1) 320.0 133% 137.1 526.7 246.3 522.6 Net
Slide 5: Salmon prices – weekly reference prices
Salmon prices – weekly reference prices • Prices in Q2 2022 up by 72% YoY in Europe, and 17% in Miami and 24% in Seattle for Chilean and Canadian salmon, respectively, in the American market 16 8 Q2-22 prices GWT/kg 14 7 • Norway EUR 10.62 (6.19) USD per lbs (Miami and Seattle) 12 6 • Chile USD 8.25
Slide 6: Price achievement and contract share
Price achievement and contract share 120% 105% 96% 95% 100% 100% 92% 87% 82% 80% 80% 60% 40% 20% 0% Norwegian Scottish Chilean Canadian Q2 2021 Q2 2022 Norwegian Scottish Chilean Canadian Q2-22 Contract share 27% 69% 63% 0% Superior share 86% 96% 94% 93% Page 6
Slide 7: Operational EBIT comparison
Operational EBIT comparison • All-time high Operational EBIT driven by Farming segment Page 7
Slide 8: Norway
Norway SALMON OF NORWEGIAN ORIGIN Operational EBITEBIT Operational Salmon of of Salmon Norwegian Origin Norwegian Origin EUR million Q2 2022 Q2 2021 Q2 Q22021 vs Q2 2022 2022 vs Q2 2021 Operational EBIT 235.2 93.0 250 EBIT 342.7 130.1 Harv est v olume (GWT) 59 815 56 084 200 Operational EBIT per kg
Slide 9: Norway: Operational EBIT/kg per region
Norway: Operational EBIT/kg per region 5.0 • Region North: Impressive margin although 4.5 4.45 negatively impacted by issues with winter sores 4.03 earlier this year and a less favourable site mix YoY 3.93 4.0 3.83 • Region Mid: Improved earnings on higher prices 3.5 and harvest volumes, partly offs
Slide 10: Norway: Sales contract portfolio
Norway: Sales contract portfolio 30,000 25,000 Contracted volumes (GWT) 20,000 15,000 10,000 5,000 0 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 Realised contract volumes Contracted volumes (including prospects) • Low contract share of 27% in the quarter following our positive market view • To b
Slide 11: Scotland
Scotland Operational EBIT Salmon of Scottish Origin SALMON OF SCOTTISH ORIGIN Operational EBIT Salmon of Scottish Origin Q2 2022 vs Q2 2021 EUR million Q2 2022 Q2 2021 Q2 2021 vs Q2 2022 Operational EBIT 20.7 29.9 50 EBIT 67.8 37.5 40 Harv est v olume (GWT) 12 954 19 162 Operational EBIT per kg (EUR
Slide 12: Chile
Chile SALMON OF CHILEAN ORIGIN Operational Operational EBIT Salmon EBIT Salmon of Chilean of Chilean Origin Origin EUR million Q2 2022 Q2 2021 Q2 2022 Q2 2021 vs Q2vs2022 Q2 2021 Operational EBIT 15.3 14.9 25 EBIT 9.3 20.0 20 Harv est v olume (GWT) 14 400 15 128 15 Operational EBIT per kg (EUR) 1.07
Slide 13: Canada
Canada SALMON OF CANADIAN ORIGIN Operational EBIT Operational Salmon EBIT SalmonofofCanadian CanadianOrigin Origin EUR million Q2 2022 Q2 2021 Q2Q22021 vs Q2 2022 2022 vs Q2 2021 Operational EBIT 31.2 -6.8 40 EBIT 10.2 -29.1 30 Harv est v olume (GWT) 10 413 13 396 20 Operational EBIT per kg (EUR) 3.
Slide 14: Ireland and Faroes
Ireland and Faroes SALMON OF IRISH ORIGIN SALMON OF FAROESE ORIGIN EUR million Q2 2022 Q2 2021 EUR million Q2 2022 Q2 2021 Operational EBIT 9.2 3.4 Operational EBIT 10.4 4.5 EBIT 8.9 4.8 EBIT 15.2 4.3 Harv est v olume (GWT) 3 294 1 850 Harv est v olume (GWT) 1 802 2 356 Operational EBIT per kg (EUR)
Slide 15: Consumer Products
Consumer Products CONSUMER PRODUCTS EUR million Q2 2022 Q2 2021 • A good quarterly result despite record-high Operating rev enues 770.9 665.0 raw material prices Operational EBIT 18.1 16.2 Operational EBI T % 2.4% 2.4% • Volumes down from 58k product weight to Operational EBI T % VAP only 2.5% 2.2%
Slide 16: Feed
Norway Feed FEED EUR million Q2 2022 Q2 2021 Operating rev enues 196.7 129.4 Operational EBITDA 6.0 7.3 Operational EBIT 2.0 3.3 Operational EBI TDA % 3.1% 5.7% Operational EBI T % 1.0% 2.6% EBIT 2.0 3.3 Feed sold v olume 110 782 96 142 Feed produced v olume 146 271 107 412 Scotland • Earnings stabl
Slide 17: Financials, Markets and Harvest volumes
Q2 2022 presentation Financials, Markets and Harvest volumes
Slide 18: Profit and Loss
Profit and Loss Mowi Group EUR million Q2 2022 Q2 2021 YTD Q2 2022 YTD Q2 2021 2021 • Positive net fair value Operational revenue and other income 1,231.7 23% 1,000.3 2,327.1 2,022.7 4,207.6 adjustment of biomass of Operational EBIT 1) 320.0 133% 137.1 526.7 246.3 522.6 EUR 140 million due to Change
Slide 19: Financial position
Financial position Mowi Group EUR million 30.06.2022 30.06.2021 31.12.2021 • Strong financial position Non-current assets 3 567.6 3 461.7 3 542.2 Current assets 3 185.8 2 477.4 2 717.6 Total assets 6 753.4 5 939.1 6 259.5 Equity 3 542.1 3 122.0 3 131.4 Non-current liabilities 1 986.4 2 061.3 2 155.3
Slide 20: Cash Flow and Net Interest Bearing Debt
Cash Flow and Net Interest Bearing Debt Mowi Group EUR million Q2 2022 Q2 2021 YTD Q2 2022 YTD Q2 2021 2021 • Improved earnings NIBD beginning of period* -1 177.1 -1 273.6 -1 458.4 -1 458.4 -1 458.4 • Working capital tie-up Operational EBITDA* Change in working capital 363.1 -100.8 178.2 82.2 612.0
Slide 21: 2022 Cash Flow Guidance
2022 Cash Flow Guidance • Working capital build-up EUR ~200m (changed from EUR 90m due to higher salmon prices and cost inflation) – Support further organic growth across the value chain • Capital expenditure EUR ~300m – Freshwater investments EUR ~ 80m – Seawater investments EUR ~ 50m – Processing
Slide 22: Overview financing
Overview financing • Bank Facility: EUR 1,800m sustainability-linked facility Share of sustainable funding – 5 years facility (Maturity: September 2026) – Covenant: 35% equity ratio (adjusted for IFRS 16 leasing effects) – Accordion option: EUR 300m – Lenders: DNB, Nordea, ABN Amro, Rabobank, Danske
Slide 23: Supply development
Supply development Estimated volumes Compared to Q2 2021 Est. volumes Suppliers Q2 2022 Q2 2021 Volume % Q1 2022 Norway 272,400 287,500 -15,100 -5.3% 305,600 Scotland 39,800 52,600 -12,800 -24.3% 31,700 Faroe Islands 18,400 23,000 -4,600 -20.0% 20,900 Other Europe 11,100 12,200 -1,100 -9.0% 18,300 T
Slide 24: Global volume development
Global volume development Estimated volumes Compared to Q2 2021 Est. volumes 12 month comparison Markets Q2 2022 Q2 2021 Volume % Q1 2022 LTM PTM % EU+UK 241,700 249,800 -8,100 -3.2% 251,400 1,127,800 1,128,300 0.0% Russia 6,700 18,200 -11,500 -63.2% 13,400 64,000 92,500 -30.8% Other Europe 20,700 2
Slide 25: Development in reference prices
Development in reference prices Q2 2022 Change vs Q2 2022 Change vs Market Q2 2021 EUR Q2 2021 Norway (1) EUR 10.62 71.5% EUR 10.62 71.5% Chile (2) USD 6.97 17.2% EUR 6.55 32.7% Chile, GWT (3) USD 8.25 20.1% EUR 7.75 36.0% Notes: (1) NASDAQ average superior GWE/kg (gutted weight equivalent) North Am
Slide 26: Industry supply growth 2022e
Industry supply growth 2022e 2019 2020 2021 2022 Estim ates 2022 GWT (1,000) Low Y/Y grow th High Y/Y grow th Norw ay 1,200 1,232 1,379 1,360 1,352 -2% 1,368 -1% UK Faroe Islands 171 78 160 73 179 95 172 91 170 89 -5% -6% 174 93 -3% -2% • H2-2022 guidance: Other Europe* Total Europe 36 1,485 42 1,50
Slide 27: Mowi volume guidance
Mowi volume guidance Atlantic salmon 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022 2022 GWT (1,000) Actual Actual Actual Actual Actual Actual Actual Actual Guidance Guidance Guidance Norway 262.0 75.0 56.1 71.0 71.1 273.2 59.4 59.8 84.0 68.8 272.0 Scotland 52.7 18.3 19.2
Slide 28: Outlook
Outlook • Strong market outlook and constrained supply side – Kontali projects 2% supply growth next 12-months • Mowi well positioned to capitalise on this with its diverse and integrated value chain • Current inflation gives cause for concern, however, recent price decline for several commodities m
Slide 29: Appendix
Q2 2022 presentation Appendix
Slide 30: Mowi ranked #1 on sustainability amongst food producers
Mowi ranked #1 on sustainability amongst food producers Good progress on reducing GHG emissions in 2022 YTD (FY 2021) and ambitious long-term targets Scope 1 & 2 GHG emissions Scope 1 & 2 & 3 GHG emissions -35% -72% 200 -5% 2,500 Tonnes (1,000) Tonnes (1,000) 2,000 150 1,500 100 1,000 50 500 0 0 202
Slide 31: Ocean-based Atlantic salmon farming is on the right side of sustainability
Ocean-based Atlantic salmon farming is on the right side of sustainability Rating agencies About the rating Score (1) Salmon is the most sustainable farmed animal protein alternative Mowi ranked as the most sustainable animal protein producer in the world (amongst the 1st largest 60 animal protein p
Slide 32: Nova Sea
Nova Sea Harv est v olume (GWT) EBI T per kg (EUR) NI BD EURm Ownership % 2020 2021 Q2 2021 Q2 2022 2020 2021 Q2 2021 Q2 2022 Q2 2022 Nova Sea 48.7 % 42 584 43 539 8 811 9 377 1.60 1.80 2.10 4.60 -69.5 • Leading integrated salmon producer in Northern Norway − 33.33 wholly owned licenses − 4 partly o
Slide 33: Dividend policy
Dividend policy • Mowi’s ambition is to create long-term value for the shareholder through both positive share price development and a growing dividend in line with long-term earnings − Quarterly ordinary dividend shall under normal circumstances be at least 50% of underlying earnings per share (EPS
Slide 34: Contract coverage and sales contract policy
Contract coverage and sales contract policy SALES CONTRACT POLICY Min hedging rate Max hedging rate (1) • Q3 2022 contract shares (% of guided volume): Norway (2) 0% 50 % Scotland 0% 75 % − Norway 22% Chile (2) 0% 50 % − Scotland 59% Canada 0% 30 % Ireland 0% 100 % − Chile 49% Faroes 0% 30 % − Canad
Slide 35: Quarterly segment overview
Quarterly segment overview SOURCES OF ORIGIN QTD EUR million Norway Scotland Chile Canada Ireland Faroes Other 1) Group OPERATIONAL EBIT FARMING 220.6 15.7 10.7 28.6 8.2 10.4 294.2 SALES AND MARKETING Markets -0.1 3.5 1.4 3.2 0.6 0.0 0.2 8.7 Consumer Products 11.9 2.2 3.2 -0.5 0.5 0.0 0.8 18.1 SUBTO
Slide 36: YTD 2022 segment overview
YTD 2022 segment overview SOURCES OF ORIGIN YTD EUR million Norway Scotland Chile Canada Ireland Faroes Other 1) Group OPERATIONAL EBIT FARMING 356.2 24.0 23.2 48.1 10.6 12.1 474.3 SALES AND MARKETING Markets 4.1 5.7 3.2 6.3 0.9 0.1 0.5 20.8 Consumer Products 26.1 3.2 9.1 -0.7 0.4 0.0 1.3 39.4 SUBTO
Slide 37: Development in harvest volumes
Development in harvest volumes GWT 2017 2018 2019 2020 2021 2022E (1,000) Total Total Total Q1 Q2 Q3 Q4 Total Q1 Q2 Q3 Q4 Total Q1 Q2 Q3E Q4E Total Norway 210.2 230.5 236.9 50.5 56.6 76.5 78.5 262.0 75.0 56.1 71.0 71.1 273.2 59.4 59.8 84.0 68.8 272.0 Scotland 60.2 38.4 65.4 9.0 14.6 16.1 13.0 52.7 1
Slide 38: Cash flow guidance and historic developments
Cash flow guidance and historic developments Net capital expenditure Net working capital 350 250 Maintenance level 300 200 250 200 150 EUR million EUR million 150 100 100 50 50 0 0 2017 2018 2019 2020 2021E 2022E 2017 2018 2019 2020 2021 2022E Financial commitments and cost of debt (*) 60 50 40 EUR
Slide 39: Thank you
MQOWI Thank you