May 24, 2017
Northern Pelagic Fishing: Good Catches North: Normalization of temperatures at sea; Abundant biomass near Iquique; Low costs Thousands of tons 140- 150 49 40-45 18 34 11 5 1 2016 2017 2016 2017 E 2016 2017 2016 2017 2016 2017 E Q1 Q2 Q3 Q4 Year Northern catches include own and third parties Company’s estimations are based on current information, which could change due to deviations 2
South-Central Pelagic Fishing J. Macke.: Normal fishing conditions vs very favorable conditions in Q1 2016-2015. Sardine: Normalization in 8th region. Higher third parties catches (+50%). Jack Mackerel Thousands of tons 106 Sardine (own) 92-106 Sardine (third parties) 12 45- 50 23 50 2 22 25-30 10- 21 14 8 2 31 4 8 37- 1-2 35 14 42 11 7-9 3 7 1 2 2016 2017 2016 2017 E 2016 2017 2016 2017 2016 2017 E Q1 Q2 Q3 Q4 Year Company’s estimations are based on current information, which could change due to deviations 3
Fishmeal Price Prices down due to higher quotas and catches in Peru. US$ / ton (Camanchaca) Peru’s Fishing Quota (North-Centre Region): Nov to Jan: 2.0 M Ton May to Jul: (98% catched) 2.8 M Ton May to Jul: May to Jul: Nov to Jan: May to Jul: Nov to Jan: 2.5 M Ton 2.6 M Ton 1.8 M Ton 1.1 M Ton No quota (68% catched) (98% catched) (99% catched) (51% catched) 2,247 2,013 Precio Harina 1,850 1,844 Prime (Chile) 1,760 IFFO Sem 18 1,676 1,613 2017 1,592 1,567 1,570 1,551 1,492 1,471 1,350 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 1,763 1,600 1,780 4
Camanchaca Diesel Price (US$/lt) 0.84 0.84 0.82 0.70 0.54 0.54 0.49 0.44 0.43 0.41 0.39 0.37 0.30 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q1 2017: • With constant volume, increased fuel costs of US $ 0.8 million. • Fuel cost is approx. 15% of the total cost of fishmeal production (anchovy and industrial sardine). 5
Stocks (valued at cost) Recovery of inventories of Fishmeal (US$ 883/ton), Fish Oil (US$ 695/ton) and Mussels (US$ 1.6/kg) March 31, 2017 December 31, 2016 March 31, 2016 December 31, 2015 VOLUM Months of ThUS$ VOLUME ThUS$ VOLUME ThUS$ VOLUME ThUS$ E Production SALMON Atlantic Salmon (Tons) 1,467 0.9 16,131 2,595 23,763 4,864 34,089 7,458 42,198 Salmon Total 16,131 23,763 34,089 42,198 FISHING 14,708 3.5 12,980 1,235 2,098 7,873 8,136 5,793 6,937 Fishmeal (Tons) Fish oil (Tons) 3,497 2.8 2,429 38 353 1,987 2,314 846 1,896 Frozen Jack Mackerel (Tons) 1,007 1.2 374 31 16 378 222 1,185 694 Canned Fish (thousands of 290 3.5 3,597 449 5,719 632 6,373 43 664 boxes) Langostino Lobster (Tons) 111 2.2 1,275 92 1,180 85 1,308 225 2,824 Fishing Total 20,655 9,366 18,353 13,015 OTHER SEAFOOD Mussels (Tons) 4,300 5.2 6,840 3,094 5,275 2,521 5,337 2,280 5,304 Abalone (Tons) 65 3.9 1,435 79 1,788 82 1,855 86 1,969 Scallops (Tons) 1 0 11 5 51 19 147 19 157 Other Seaafood Total (Tons) 8,286 7,114 7,339 7,430 COMPANY TOTAL 45,072 40,243 59,781 62,643 6
Salar: 2015 Stocking Reduction Decision Harvest (thousands of tons WFE) 45 43 39 12 32 32 HAB 29 24 Q1 27 12 11 9 5 2014 2015 2016 2017 E 2015 Prices at their historical lows impacted by currency devaluations against the US dollar led to the decision of not stocking 2 sites in favor of a solid financial position. 2016 Biomass was replaced by capital for approximately US$ 25 million that allowed to meet the financial obligations in a period with a severe El Niño phenomenon and low prices of salmon. It allowed a better payment negotiation of the insurance associated with the HAB event. 2017 Harvest reduction of 7,400 tons with a high impact in H1 2017 Company’s estimations are based on current information, which could change due to deviations 7
Atlantic Salmon Price Stable prices for an estimated increase ~ 3% of world supply in 2017 but with differences in semesters. Lower harvests in Q1-17 due to HAB 2016 and lower stocking 2015. Price (US$ / Kg WFE) Harvest (Thousands of Tons) 2017 2016 6.5 Δ +16% 7.1 6.8 6.7 5.6 Δ +16% 6.2 5.8 Δ +69% 4.2 30- 33 33 9.1 9.0 7.9 6.7 5-6 4.8 3.00 E E Q1 Q2 Q3 Q4 Year Company’s estimations are based on current information, which could change due to deviations 8
Atlantic Salmon Price: Long-term trend Large devaluation in major Urner Barry Equivalent Trim C 2-3 (US$/Lb) markets and non-tariff restrictions Algae bloom 6.5 Overshooting recovery ISA Virus post ISA 6.0 5.5 5.0 4.5 4.0 3.5 3.0 2.5 2.0 may-17 ene-04 jul-04 ene-05 jul-05 ene-06 jul-06 ene-07 jul-07 ene-08 jul-08 ene-09 jul-09 ene-10 jul-10 ene-11 jul-11 ene-12 jul-12 ene-13 jul-13 ene-14 jul-14 ene-15 jul-15 ene-16 jul-16 ene-17 Δ supply: 5% 4% 2% 10% 7% -2% -1% 12% 22% 2% 9% 4% -7% 2% E Source: ABG Sundal Collier 9
Atlantic Salmon: Return of the raw material (relative performance) Camanchaca vs Market (Salmonex, January 2015 = Base 100) Urner Barry Salmonex Camanchaca 200 180 160 140 120 100 80 60 40 20 0 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Lag in months with strong spot price increases (Mar - Jun 2016 and Jan - Feb 2017) Q1-17: Camanchaca’s return ties with comparable indexes 10
Salar Stocking: Chilean Industry Salar Stocking January to April (million fish) +20% 42 40 +40% 35 30 2014 2015 2016 2017 Source: Information and self-estimation 11
Salar Stocking Plans 10th and 11th regions Salar Stocking in previous cycle vs post new regulation cycle (million fish): 50% of the neighborhoods -5,4% Previous cycle Post new regulation cycle 79.5 75.2 6.8 6.8 Total 10th - 11th Region Source: Subsecretaría de Pesca y Acuicultura 12
Chilean Salmon Price Expectation for 2017 Urner Barry Trim C 2-3, spot market USD/Lb 6.50 6.00 5.50 5.00 4.50 4.00 3.50 3.00 Jan-17 Feb-17 Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Fishpool Index Forwards Based Model Adjusted By: • Seasonal Historical Demand in the USA • US vs European salmon offer growth differences Source: Kontali, Fishpool, own analysis 13
Atlantic Salmon Sanitary Conditions in Camanchaca (closed cycle) Q1-16 affected by harmful algae bloom (HAB) event. Favorable sanitary conditions starting in Q2-16 Mortality 2015 2016 2017 64.3% 36.8% 19.2% 8.7% 9.0% 7.3% 5.5% 5.5% 3.8% E E Q1 Q2 Q3 Q4 Year Economic Feed Conversion Ratio 2.87 1.66 1.58 1.35 1.33 1.27 1.25 1.21 1.20 E E Q1 Q2 Q3 Q4 Year Company’s estimations are based on current information, which could change due to deviations 14
Atlantic Salmon Costs Q4-15 and H1-16 affected by SRS and low oxygen conditions in the 10th region. Better Q1-17 vs Q1-15 and Q1-16. Atlantic Salmon - Liveweight ex-cage cost (US$ / kg) 3.66 3.75 Others 3.09 3.07 3.08 2.95 3.02 2.92 2.79 2.79 Medicine Labor Smolt OPEX Feed Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 3.01 3.31 15
Development of Atlantic Salmon Margins Back to positive margins in Q2-16 increased in H2-16 Lower harvests in Q1-17 (-47%) with increase in unit cost. Raw Material Cost and RMP (Raw Material Return) 11th region sites 10th region sites Base 100 = RMP January 2014 130 Leptepu Puelche Leptepu Puelche |Lep.| Licha Cahuelmó Cahuelmó Forsyth 120 Licha Ahoní |Ahoní| Johnson 2 Contao 110 Pilpilehue Lamalec Loncoch. |Pilp.- Mañihueico 100 Marilmó |Mar.| Cabudahue Izaza Islotes |--Izaza--| 90 Porc. Puerto Arg. Islotes Edwards |Porc.| |P. Arg.| 80 |--Edwards--| F.Largo |F.Larg.| 70 60 50 Dec-17 Jan-14 Apr-14 Jul-14 Oct-14 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 RM cost before processing RMP 16
Development of Atlantic Salmon Margins EBIT (US$/Kg WFE) before Fair Value in the Salmon business Atlantic Salmon Business EBIT without trout joint account 3.0 2.78 2.5 1.93 2.0 1.5 0.87 1.0 0.46 0.5 0.0 -0.5 -0.72 -1.0 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 0.64 (0.10) 0.72 Atlantic Salmon Business includes other Revenues and Costs due to services and sales to third parties, and intercompany salmon sales to our offices abroad. 17
Results January – March (US$ million) 2016 2017 Profit/Loss 6.7 2.4 1.4 0.3 -0.5 -2.7 -3.6 -4.6 Fishing Salmon Other Seafood TOTAL EBITDA (before Fair Value) 18.8 15.3 0.4 -0.2 -1.2 -3.9 -6.0 -7.3 Fishing Salmon Other Seafood TOTAL 18
Last 4 mobile quarters development EBITDA Revenues X% EBITDA/Revenues 496 489 488 487 485 483 483 470 462 459 453 13.3% 446 12.4% 12.0% 439 11.4% 11.0% 66.1 10.2% 10.0% 60.0 58.7 55.4 53.0 6.7% 47.1 5.6% 45.1 4.9% 3.0% 32.8 2.3% 25.5 1.8% 21.6 14.5 10.1 8.7 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 19
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