GRIEG SEAFOOD ASA Q2 2019 1 Grieg Seafood ASA Q2 2019 AGENDA - PowerPoint PPT Presentation

GRIEG SEAFOOD ASA Q2 2019 1

Grieg Seafood ASA Q2 2019 AGENDA • HIGHLIGHTS • OPERATIONAL REVIEW • FINANCIAL REVIEW • OUTLOOK & SUMMARY 2

Grieg Seafood ASA Q2 2019 HIGHLIGHTS 3

Grieg Seafood ASA Q2 2019 Highlights • Earnings driven by overall high prices and cost reductions in Rogaland • Strong biological performance in Norway • Strategic evaluation of farming area Skye in Shetland initiated • Biological challenges related to sea lice and algae in British Columbia • Targeting harvest volume of 82 000 tonnes in 2019 and remaining confident in 2020 production and cost target • We are committed to our ambition for sustainable salmon farming and long- term value creation 21.08.2019 4

Grieg Seafood ASA Q2 2019 Financial highlights Q2 2019 EBIT * (NOK MILLION) HARVEST VOLUME (TONNES GWT) EBIT/kg * (NOK) 23 682 22 568 18.89 426.3 21 802 18.07 350.7 14.81 16 941 14.17 308.9 14 801 267.5 9.43 159.7 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 * EBIT before fair value adjustment of biological assets 21.08.2019 5

Grieg Seafood ASA Q2 2019 Sustainability Our strategic focus areas Digitalization in Biosecurity and fish Expansion Post-smolt strategy salmon farming welfare opportunities 21.08.2019 6

Grieg Seafood ASA Q2 2019 FARMING THE OCEAN FOR A BETTER FUTURE Our approach PROFIT & HEALTHY SUSTAINABLE LOCAL to sustainable PEOPLE INNOVATION OCEANS FOOD COMMUNITIES business • • • • • Seafood demand Fish health and Safe and healthy Creating Local value welfare food attractive jobs creation and • Economic ripple-effects • • productivity Sustainable feed Keeping our • Sea lice control With our five pillars, we are employees safe • • • Local Profitable Reducing carbon committed to sustainable and • • procurement growth Escape control emissions Transparency, long-term value creation for all integrity and • • • Precision farming Waste our stakeholders. • anti-corruption Sponsorships Limiting local management • emissions • Research and Data security and • Transparency innovation privacy • and dialogue Interaction with wild life 21.08.2019 7

Grieg Seafood ASA Q2 2019 Sustainable business - Reducing carbon emissions • The World’s first fish farm outfitted with solar panels and wind power introduced in Rogaland in Q2 2019 • The combination of wind power, solar panels and batteries results in a substantial reduction of carbon emissions. On this site we will save 36 000 liters of diesel annually 21.08.2019 8

Grieg Seafood ASA Q2 2019 OPERATIONAL REVIEW 9

Grieg Seafood ASA Q2 2019 EBIT/kg (NOK) 29.6 27.2 25.3 19.0 11.9 11.5 7.4 6.8 0.4 Q2 17 Q3 17 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 GSF Rogaland Harvest volume (1 000 tonnes GWT) 8.5 7.8 6.4 6.2 5.7 4.3 2.3 1.7 1.4 Q2 17 Q3 17 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 21.08.2019 10

Grieg Seafood ASA Q2 2019 GSF Rogaland • Strong biological performance resulted in high harvest weights and improved price achievement NOK million Q4 2018 Q4 2017 YTD 2018 YTD 2017 • Cost stable from Q1 and down y-o-y due to higher mean 355.7 219.9 959.6 1 150.2 Revenues NOK million Q2 2019 Q2 2018 YTD 2019 YTD 2018 harvest size and improved fish health EBITDA * 130.8 39.9 267.6 430.6 Revenues 562.6 380.7 933.9 528.2 • No sites affected by PD at end of Q2 117.8 29.1 219.6 393.1 EBIT * EBITDA * 255.9 85.4 418.5 124.0 • Survival rate of 94% over the last 12 months Harvest volume EBIT * 6 185 4 278 16 293 18 111 232.1 73.9 377.1 101.3 (tonnes GWT) • Harvest volume Encouraging results with large size smolt spending less 19.04 6.80 13.48 21.70 EBIT/ kg* (NOK) 8 526 6 409 14 257 8 704 (tonnes GWT) than 12 months in the sea EBIT/ kg* (NOK) 27.22 11.53 26.45 11.64 • Eight sites monitored and fed from pilot Precision Farming operations center * EBIT and EBITDA before fair value adjustment of biological assets. Q2 and YTD 2019 include IFRS 16 effects. • Expected harvest volume of 2 800 tonnes in Q3 2019 and higher cost/kg due to lower volume • Targeting 22 000 tonnes for 2019 and 25 000 tonnes in 2020 21.08.2019 11

Grieg Seafood ASA Q2 2019 EBIT/kg (NOK) 25.0 22.4 20.8 20.5 20.1 19.6 18.0 14.5 11.9 Q2 17 Q3 17 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 GSF Finnmark Harvest volume (1 000 tonnes GWT) 10.8 8.6 8.4 8.4 6.4 5.7 5.4 4.1 4.2 Q2 17 Q3 17 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 21.08.2019 12

Grieg Seafood ASA Q2 2019 GSF Finnmark NOK million Q4 2018 Q4 2017 YTD 2018 YTD 2017 • Strong overall biological performance and survival rate of 355.7 219.9 959.6 1 150.2 Revenues NOK million Q2 2019 Q2 2018 YTD 2019 YTD 2018 96% over the last 12 months EBITDA * 130.8 39.9 267.6 430.6 Revenues 319.6 378.7 666.1 608.0 • Cost/kg higher than Q1 2019 as a result of early harvest 117.8 29.1 219.6 393.1 EBIT * EBITDA * 141.9 164.4 315.4 248.4 on one site due to winter-ulcer. Stable cost y-o-y Harvest volume EBIT * 6 185 4 278 16 293 18 111 110.7 142.7 253.7 203.2 • (tonnes GWT) Another three sites ASC certified in Q2 brings the total to Harvest volume eight ASC certified sites in Finnmark 19.04 6.80 13.48 21.70 EBIT/ kg* (NOK) 5 391 6 387 11 111 10 565 (tonnes GWT) • Expected harvest volume of 10 600 tonnes in Q3 2019, EBIT/ kg* (NOK) 20.53 22.35 22.84 19.23 with higher cost due to harvesting of high-cost sites (winter-ulcer and MAB limits) * EBIT and EBITDA before fair value adjustment of biological assets. Q2 and YTD 2019 include IFRS 16 effects. • Targeting 34 000 tonnes harvest in 2019 and 38 000 tonnes in 2020 21.08.2019 13

Grieg Seafood ASA Q2 2019 EBIT/kg (NOK) 16.7 9.5 8.3 6.0 1.3 Q2 17 Q3 17 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 -1.2 -6.0 -5.9 -13.9 GSF Shetland Harvest volume (1 000 tonnes GWT) 4.5 4.4 3.7 3.3 3.2 3.1 2.5 1.8 1.2 Q2 17 Q3 17 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 21.08.2019 14

Grieg Seafood ASA Q2 2019 GSF Shetland • Volume and revenue growth compared to Q2 2018. Lower price achievement due to reduction in spot prices NOK million Q4 2018 Q4 2017 YTD 2018 YTD 2017 355.7 219.9 959.6 1 150.2 Revenues • Superior share of 96% NOK million Q2 2019 Q2 2018 YTD 2019 YTD 2018 EBITDA * 130.8 39.9 267.6 430.6 Revenues 225.4 193.1 347.7 279.9 • Improved smolt quality 117.8 29.1 219.6 393.1 EBIT * EBITDA * 5.2 52.7 4.5 58.0 • Continued challenging biological conditions related to algae Harvest volume EBIT * 6 185 4 278 16 293 18 111 -19.8 41.5 -44.7 34.4 blooms and gill-related diseases in Q2 2019 (tonnes GWT) Harvest volume 19.04 6.80 13.48 21.70 EBIT/ kg* (NOK) 3 297 2 482 5 086 3 683 • Strategic evaluation of Skye, to focus resources and (tonnes GWT) operations EBIT/ kg* (NOK) -6.00 16.72 -8.79 9.34 • Cost expected to remain high in Q3, but improved fish health * EBIT and EBITDA before fair value adjustment of biological assets. and increased production will gradually reduce cost/kg Q2 and YTD 2019 include IFRS 16 effects. • Estimated harvest volume of 3 400 tonnes in Q3 2019 • Targeting harvest volume of 12 000 for 2019 and 17 000 tonnes in 2020 21.08.2019 15

Grieg Seafood ASA Q2 2019 EBIT/kg (NOK) 23.9 22.7 14.9 14.5 14.2 7.2 6.7 4.5 -0.8 Q2 17 Q3 17 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 GSF British Columbia Harvest volume (1 000 tonnes GWT) 7.3 4.6 3.8 3.4 2.9 2.6 2.6 2.4 1.6 Q2 17 Q3 17 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 21.08.2019 16

Grieg Seafood ASA Q2 2019 GSF British Columbia (BC) • Earnings down 42% y-o-y due to lower volume and price. NOK million Q4 2018 Q4 2017 YTD 2018 YTD 2017 • USD spot market prices down -11% y-o-y 355.7 219.9 959.6 1 150.2 Revenues NOK million Q2 2019 Q2 2018 YTD 2019 YTD 2018 • NOK -32 million write-down from extraordinary mortality. EBITDA * 130.8 39.9 267.6 430.6 Revenues 280.2 492.7 379.7 725.8 EBIT effect of NOK 7.09/kg 117.8 29.1 219.6 393.1 EBIT * EBITDA * 13.7 184.4 53.2 279.2 • Harvest volume Challenging biological conditions due to sea lice, algae EBIT * 6 185 4 278 16 293 18 111 -3.5 173.9 19.2 259.0 (tonnes GWT) and low oxygen level. Continued focus on algae Harvest volume mitigation and digital monitoring 19.04 6.80 13.48 21.70 EBIT/ kg* (NOK) 4 587 7 290 6 149 11 049 (tonnes GWT) • New wellboat increasing lice treatment capacity at end of 2019 EBIT/ kg* (NOK) -0.77 23.85 3.12 23.44 • Expansion of Gold River smolt facility on track * EBIT and EBITDA before fair value adjustment of biological assets. • Estimated harvest volume of 4 700 tonnes in Q3 2019 Q2 and YTD 2019 include IFRS 16 effects. with somewhat lower cost/kg • Targeting harvest volume of 14 000 in 2019 and 20 000 tonnes in 2020 21.08.2019 17

Grieg Seafood ASA Q2 2019 FINANCIAL REVIEW 18