1H 2019 Results Presentation to Investors and Analysts
Forward Looking 1H 2019 Results Statements Presentation to Investors and Analysts Disclaimer This presentation is furnished and intended for European market participants and should be viewed in that manner. Any potential forward looking statements contained in this presentation are reflective of managements current views on future events and performance, whilst the views are based on positions that management believes are reasonable there is no assurances that these events and views will be achieved. Forward looking views naturally involve uncertainties and risk and consequently actual results may differ to the statements or views expressed.
1H 2019 Results Presentation to Investors and Analysts We are Iceland Seafood
Global value added seafood producer and 1H 2019 Results global sales and marketing company Presentation to Investors and Analysts 1932 620 12 Our beginn inning ing Employ loyees ees Businesses inesses in 8 co countries ries Long lasting Market and client Global distribution relationship expertise 7 +€440m Serving over 3000 customers Valu lue e added ed factor orie ies Annual ual revenues enues across Innovation Listed on Nasdaq 45 countries and client focus First North
Key projects to drive growth 1H 2019 Results and efficiency Presentation to Investors and Analysts Facility extension and Ongoing merger of Closer cooperation automation of Icelandic Iberica and with producers a key production within IS Spain growth driver Oceanpath • Fresh fish production facility • The decision of merging • The benefits of integrated value extended by 1,258m2, Icelandic Iberica and IS Spain chain, with key producers in construction finalized in May announced in February. Magnus Iceland joining the shareholders Jonsson appointed as MD for group, have started to come • Salmon filleting line up and the merged entity and new through running from mid-July management team formed • Continuing focus on utilizing our • Total investment of €2.9m, will • Significant opportunities of platform of 3000 customers support further growth and economies of scale and scope, worldwide in cooperation with increase efficiency integration and optimization of producers in Iceland functions and processes • At the same time, continue to • Encourages better services to grow our substantial global both customers and suppliers sourcing network
Key projects to drive growth 1H 2019 Results and efficiency Presentation to Investors and Analysts Investment to enhance Main Market listing, growth and profitability logical step for Iceland of Achernar Seafood • In 1H 2019, the board approved • More efficient pricing of shares an investment project for and increased awareness Achernar • Facilitates further growth, both • The new building will consist of a organic and acquired coldstore and a new production • Increased information sharing area and discipline towards investors • Investment will increase • Dividend policy – Pay 20-40% of production capacity by ca. 50%, PAT annually as dividend. secure storage space, make Targeted equity ratio of 35%, logistic more efficient and which shall be reached within improve quality controls, the next three years • Total investment in the range from €1.3 -1.6m
Merger in Spain - Creation of 1H 2019 Results South European powerhouse Presentation to Investors and Analysts Will create a strong value Significant synergy added player with great opportunities, in product and brand revenue as well as for recognition in the market cost • S-European market vitally important • Estimated annual synergies of for cod products from Iceland €3.0 -3.5m, expected to materialize in full before year Ongoing integration end 2021 process • To enjoy long term benefits, one off cost will be incurred in the • Operation in Barcelona in single coming periods location as of October this year • Part of Icelandic production in Malaga being moved to Barcelona as of June 2019 • Merged legal entity operating from January 1 st 2020
New shares to be offered in 1H 2019 Results relation to main market listing Presentation to Investors and Analysts Main market listing in early Q4 Public offering of new shares 2019 • As previously announced, the Company is working • As approved at the Company‘s Annual General towards a listing on Nasdaq Iceland meeting in June this year, 225,000,000 new shares will be issued and sold by Iceland Seafood in a • Preparations are ongoing and the listing, along public offering managed by Kvika banki hf. 1) with a public offering of new shares, is expected in early Q4 2019 • Subscriptions will be offered in two order books, which differ in terms of size of subscription, pricing and rules of allocation • The purpose of the offering is to further strengthen the Issuer's financial position, facilitate increased liquidity of the shares, create a more diverse shareholder base and support continuing growth 1) Equivalent to 9.63% of Iceland Seafood‘s share capital pre dilution and 8.78% post dilution
1H 2019 Results Presentation to Investors and Analysts Financial Of Divisions At Group level performance Balance sheet
Profitability driven 1H 2019 Results by value added activities Presentation to Investors and Analysts Corporate Structure Turnover Profit Before Tax Value Added Divisions • Good cooperation and service to producers in Iceland is vitally • Following acquisitions last year, important for the Group’s 2013 2013 two value added activities are Iceland Seafood success reported in two divisions Strong combination 74% 26% 71% • The decision to merge Icelandic 29% Iberica and Iceland Seafood • Strong ties to the source is key to Value Value Spain will form a strong our position in selling food Added Added Sales & organization in the important protein to the market Northern Southern Distribution Europe Europe Southern Europe market 2018 2018 • Understanding of the market Proforma Proforma • The two Value Added divisions demand and behavior is vital to generate over 90% of total maximise sourcing power 9% IS Spain IS Iceland divisional PBT • Having strong sourcing and IS 39% Barraclough Icelandic Sales & Distribution processing capabilities and being IS France Ibérica 61% 91% close to the market is a key Oceanpath • Approximately 60% of the Group IS Germany attribute towards profitability Ecomsa Havelok sales are generated by products IS USA sourced from Iceland, the Achernar Sales & Value Added backbone of the Group Distribution
Good results enhanced by > VA S-Europe 1H 2019 Results > VA N-Europe strong sales growth Presentation to > Sales & Distribution Investors and Analysts Normalised PBT €3m Division incorporates € m´ s 1H 2 2019 1H 2 2018 1H 2 2018P 8P up from prior year, up three manufacturing 90.5 Sales 96.8 33.9 €1m on proforma 2018 sites in Barcelona, Net margin 10.8 3.3 10.5 Malaga and Argentina • Sales increase a key driver Normalis lised ed EBITD TDA 4.9 1.0 3.9 • Cost reduction related to the 2.8 Normalise lised d PB PBT* T* 3.8 0.8 Servicing the merger in Spain starting to pay off * Normalised PBT represents Profits before tax before allowing for significant items foodservice and retail • Outlook for weaker 2H of the year, and discontinued operations markets in Southern impacted by lower profits of Europe Achernar and reduced volume of wet salted products. Sales increased by 7% Key projects for 2H from prior year Proforma 2019 • Strong demand for light salted • Merged legal entity operating from products in S-Europe year beginning 2020 • Squid sales from Argentina, a new • Investment in coldstore and project delivering sales of €2.1m in production facility at Achernar, 1H 2019 total investment of €1.3 -1.6m.
Challenging start of the year, > VA S-Europe 1H 2019 Results > VA N-Europe encouraging outlook for 2H 2019 Presentation to > Sales & Distribution Investors and Analysts External challenges Division incorporates € m´ s 1H 2 2019 1H 2 2018 1H 2 2018P 8P impacting profits in manufacturing sites in 50.1 Sales 48.3 44.1 the period Grimsby, Bradford and Net margin 5.4 4.8 6.2 two in Dublin • Fluctuations and higher Normalis lised ed EBITD TDA 2.6 2.7 3.4 stockholding due to the ongoing 1.6 1.9 2.5 Normalise lised d PB PBT* T* uncertainty around Brexit Servicing the retail • High raw material prices * Normalised PBT represents Profits before tax before allowing for significant items and foodservice and discontinued operations. • UK retail trending towards markets in the UK and packed at source Ireland Outlook for improved 2H 2019 Sales 4% down on • Salmon prices stabilizing and prior year proforma, currently at lower levels than Normalised PBT down same time last year. Benefits €0.9m from new investment in Ireland • Sales in Ireland in line with • New listings with key retailers previous year, but at lower and cost reduction actions in UK margins starting to pay off
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