Arctic Fish Holding

Quarterly Report • Aug 21, 2024

Q2|2024 Report 21 August 2024

	Highlights Q2 2024 2
	Principal activities 3
	Q2 2024 Performance 4
	Outlook 6
	Board Declaration 9
	Consolidated Income Statement 10
	Statement of Financial Position 11
	Statement of Equity 12
	Statement of Cash Flow 13
Note 1	General Information 14
Note 2	Accounting Principles 15
Note 3	Estimates and Risk Exposure 16
Note 4	Biological Assets 17
Note 5	Financial Items 18
Note 6	Share Capital 19
Note 7	Shareholders 20
Note 8	Share Price Development 21

Highlights Q2 2024

• Best first half of any year in the history of the company, both from an operational EBIT perspective as well as operational EBIT pr. kg.
• Harvested quantities amounted to 1,275 tonnes compared to 100 tonnes for the same period last year, bringing good balance to harvesting operations compared to last year.
• Operational EBIT pr. kg amounted to 1.82 EUR pr. kg compared to a negative Operational EBIT pr. kg last year, which was due to volume limitations and is therefore not entirely comparable.
• Relatively good biological performance with steady growth.

(EUR '000)	Q2 2024	Q2 2023	YTD Q2 2024 YTD Q2 2023		2023
Operational revenue and other income	11.608	1.276	35.746	40.266	88.900
Operational EBITDA	4.473	575	16.296	12,378	21.239
Operational EBIT	2.324	-808	12.049	9.589	14.493
Net interest-bearing debt (NIBD)	118.628	90.230	118.628	90.230	114.289
Underlying EPS (EUR)	0,11	0,03	0,36	0,34	0,59
Net cash flow per share (EUR)	-0,12	-0,31	0,02	-0,53	-1,14
ROCE	4,3%	-2,2%	12,6%	12,7%	7,6%
Equity ratio	37,5%	47,1%	37,5%	47,1%	38,0%
Harvest volume (GWT)	1.275	100	3.806	4966	11.878
Operational EBIT - EUR per kg	1,82	-8,08	3,17	1,93	1,22

Principal activities

The Group's principal activity is salmon farming, producing smolt in its own freshwater hatchery and farming salmon at sea before the fish is harvested and finally sold to the market.

Freshwater smolt

The Group has a modern freshwater hatchery and smolt facility in Norðurbotn (Tálknafjörður), using RAS technology. The Group owns a 36.3 km2 land area surrounding the facility and securing existing and future expansion with both sufficient land and water capacity.

Seawater sites

The Group's production capacity for the company is 29,800 tonnes MAB (Maximum Allowed Biomass) and includes licenses covering 13 farming areas in 6 different fjords, all located in the Westfjords of Iceland. This structure enables alternation of production areas to minimize biological risk. The sites are in general considered with high bearing capacity indicated by low and non-impact proven by regular bottom surveys. The Group currently holds licenses for a production of the 29,800 tonnes thereof 27,000 tonnes for fertile salmon.

Processing

All processing of the Group's salmon since Q3'2023 and onwards takes place in the company's brand-new, state of the art harvesting facility in Bolungarvík. The facility has been designed to fulfil the short and long-term needs of Arctic Fish, with extension and growth possibilities for external service contracts for other farmers.

Sales

The fish is sold through a sales agreement with Mowi. The Group sees substantial potential in utilizing the synergies from the majority owner Mowi with sales being handled by Mowi from September 2023 and onwards.

Market routes both domestically and internationally are developing positively, and there is potential to enter markets and costumers efficiently.

Q2 2024 Performance

The second quarter's performance will be broken down into the main operating categories, investments, and financing. In brackets some historical performance for the year 2023 is provided.

Key financial Performance

(Figures in brackets = 2023, unless otherwise specified)

Revenues and results

Revenues amounted to 11.6 MEUR in the quarter, compared to 1.3 MEUR in the corresponding prior-year period, the difference is solely due to volume differences year over year.

The Group achieved a positive operational EBIT of EUR 2.3 million (Q2'2023: EUR - 0.8 million)

The Operational EBIT in Q2 this year is a definitive improvement when comparing the two periods year over year, especially when considering the positive impact of balancing out harvesting operations, which in turn stabilizes fixed operational costs.

The sold volume HOG was 1,275 tonnes in the quarter, compared to only 100 tonnes harvested in the same respective period last year.

The Group recognised a negative fair value adjustment of EUR -4.4 million (Q2'2023: EUR 4.2 million) on the biomass in sea, a decrease of EUR 8.6 million compared to the corresponding quarter in 2023. The lower fair value adjustment in the quarter can largely be attributed to lower forward prices.

Financial items

Net financial losses were EUR -2.4 million in the quarter (Q2'2023: EUR -4.1 million). Net interest payments in the quarter amounted to 2.4 million EUR in the period, whilst other financial items broke even.

Balance sheet

At the end of the second quarter 2024, total assets amounted to EUR 233.3 million, which is a decrease of EUR 3.1 million from the prior period (Q1'2024). This is mainly due to a reduction of current assets.

Net interest bearing debt

Net interest bearing debt has increased from 112.3 MEUR to 118.6 MEUR in the quarter as a result of negative operational cash flow, mainly related to working capital build up. Capital Expenditures overall have a minimal impact due to lesser investments this year. The financial items also contribute to the increase in NIBD, with the net change in the quarter amounting to EUR 6.3 million.

Equity

At the end of the reporting period, the Group's equity totalled EUR 87.5 million, a decrease of EUR 4.1 million from the end of the previous quarter. The equity ratio at the end of the quarter amounted to 37.5%, which is a decrease of 1.3% from the previous quarter.

Seawater

Biological performance in the quarter was relatively good, with steady production and improved harvest average weight and high superior share.

Smolt production

Biological performance in the quarter was fundamentally solid, with closing average weight increasing slightly compared to the same period last year.

Outlook

Markets and sales

Harvesting volumes in 2024 are expected to amount to 10.1 thousand tonnes, which is 15% less than realized in 2023, where the company harvested an all time high of 11.9 thousand tonnes.

Investments

CAPEX was minimal in the quarter as was the intention. Minor investments were made in farming and other smaller production based equipment.

It should be noted that the smolt expansion is still in a restructuring phase after the fire incident at the start of last year.

Licenses

In the previous quarter, Q1 2024, the company received a license for 8,000 tonnes in Ísafjarðardjúp. 5,200 tonnes are licenses for fertile salmon with the remaining 2,800 tonnes being trout. This replaces an existing license held for 5,300 tonnes of trout. In addition, the company received a renewed license of 7,800 tonnes for Patreksfjörður and Tálknafjörður.

The total production capacity for the company after the license update is 29,800 tonnes MAB (Maximum Allowed Biomass) and includes licenses covering 13 farming areas in 6 different fjords, all located in the Westfjords of Iceland. Of the 29,800 tonnes, 27,000 tonnes are for fertile salmon.

Production capacity SW (tonnes)

8

Board Declaration

Responsibility statement from the board of directors and CEO

We confirm, to the best of our knowledge, that the financial report for the second quarter of 2024 has been prepared in accordance with IAS 34 – Interim Financial Reporting, as adopted by EU, and gives a true and fair view of the Group's assets, liabilities, financial position and profits and loss for the period. Furthermore, we confirm that the interim management report includes a fair view of the information required under the Norwegian Securities Trading Act § 5-6, fourth paragraph.

19.08.2024

The Board of Directors of Arctic Fish Holding AS

Øyvind Oaland

Chairman

Ivan Vindheim Board member

Gunnþór Ingvason Board member

Gunnar Atli Gunnarsson Board member

Hildur Árnadóttir Board member

The Management of Arctic Fish Holding AS

Stein Ove Tveiten CEO

Baldur Smári Einarsson CFO

Consolidated Income Statement

(EUR '000)	Q2 2024	Q2 2023	YTD Q2 2024	YTD Q2 2023	2023
Revenue	11.608	1.276	35.746	40.266	88.900
Cost of materials	-2.206	3.863	-8.985	-17.314	-45.019
Net fair value adjustment biomass	-4.363	4.238	-2.972	53	-412
Salaries and personnel expenses	-2.372	-1.907	-4.767	-3.608	-9.397
Other operating expenses	-2.557	-2.659	-5.698	-6.965	-13.245
Depreciation and amortisation	-2.149	-1.382	-4.247	-2.789	-6.745
License and production fees / taxes	-322	-12	-963	-601	-1.473
Restructuring costs	-359		-786		-16.456
Impairment losses and write-downs		-507		-507	-790
Earnings before financial items (EBIT)	-2.720	2.910	7.327	8.535	-4.638
Interest expenses	-2.398	-2.342	-4.831	-4.264	-9.543
Net currency effects	4	-1.736	-255	-1.811	-2.250
Other financial items	-2	-13	-4	-53	243
Earnings before tax	-5.115	-1.181	2.237	2.406	-16.188
Income taxes	1.023	1.670	-447	953	3.312
Profit or loss for the period	-4.092	490	1.790	3.359	-12.876
Total comprehensive income for the period attributable to
Owners of Arctic Fish Holding AS	-4.092	490	1.790	3.359	-12.876
Basic earnings per share (EUR)	-0,13	0,02	0,06	0,11	-0,40

Statement of Financial Position

(EUR '000)	30.6.2024	31.3.2024	30.6.2023	31.12.2023
Assets
Farming licenses	5.709	5.551	5.021	5.364
Goodwill	658	658	658	658
Deferred tax assets	3.467	2.444	1.555	3.914
Other intangible assets	290	308	2	325
Property, plant & equipment	129.565	130.972	119.845	128.198
Other shares and other non-current assets	62	62	62	62
Total non current assets	139.751	139.994	127.142	138.520
Inventory	3.237	2.445	2.966	2.372
Biological assets	76.343	70.388	68.539	65.903
Current receivables	5.822	9.216	8.931	6.519
Cash	8.130	14.342	8.743	12.316
Total current assets	93.531	96.392	89.180	87.110
Total assets	233.283	236.386	216.322	225.630
Equity and liabilities
Equity	87.530	91.623	101.974	85.739
Total equity	87.530	91.623	101.974	85.739
Deferred tax liability
Non current interest bearing debt	126.758	126.681	65.391	126.605
Non current leasing liabilities	156	175	270	194
Total non current liabilities	126.914	126.857	65.661	126.799
Current interest bearing debt			33.582
Current leasing liabilities	ರಿ ನ	95	91	ઠેર્ટ
Other current ligbilities	18.743	17.812	15.013	12.998
Total current liabilities	18.838	17.907	48.687	13.093
Total equity and liabilities	233.283	236.386	216.322	225.630

Statement of Equity

(EUR '000)	Share capital		Other paid in capital of other equity reserves Total equity
Equity 01.01.2024	3.032	95.281	-12.572	85.741
Comprehensive income			1.790	1.790
Transactions with owners
Total Equity end of period	3.032	95.281	-10.783	87.530

(EUR '000)	Share capital		Other paid in capital
Equity 01.01.2023	3.032	95.281	302	98.615
Comprehensive income			-12.876	-12.876
Transactions with owners
Total Equity 31.12.2023	3.032	95.281	-12.574	85.739

Statement of Cash Flow

(EUR '000)	Q2 2024		Q2 2023 YTD Q2 2024 YTD Q2 2023		2023
Earnings before tax	-5.115	-1.181	2.237	2.406	-16.188
Interest expense	2.398	2.342	4.831	4.264	9.543
Net currency effect	-4	1.736	255	1.811	2.250
Other financial item(s)	2	13	4	53	-243
Net fair value adjustment and onerous contracts	4.363	-4.238	2.972	-53	412
Impairment losses, depreciation and amotization	2.149	1.889	4.247	3.296	7.535
Change in inventory, trade payables and trade receivables	-6.789	383	-7.777	-3.241	-697
Cash flow from operations	-2.997	945	6.769	8.536	2.612
Purchase of fixed assets and additions to intangible assets	-883	-8.976	-5.925	-23.606	-36.865
Cash flow from investments	-883	-8.976	-5.925	-23.606	-36.865
Net proceeds from new interest-bearing debt		5.015		25.695	164.332
Downpayments interest bearing debt		-2.803		-5.225	-116.229
Downpayment leasing debt	-19	-8	-38	-16	-88
Net interest and financial items paid	-2.318	-2.324	-4.738	-3.959	-8.323
Currency effects	4	-1.808	-254	-1.808	-2.248
Cash flow from financing	-2.333	-1.928	-5.030	14.687	37.442
Change in cash in the period	-6.212	-9.959	-4.186	-383	3.189
Cash - opening balance	14.342	18.702	12.316	9.126	9.126
Cash - closing balance	8.130	8.743	8.130	8.743	12.316

Selected notes to the Interim Financial Statements

Note 1 General Information

Arctic Fish Holding AS and its subsidiaries (collectively "the Group", or "Arctic Fish Group") is a publicly listed company on Euronext Growth, with the ticker symbol AFISH.

Arctic Fish Holding AS is a Company incorporated in Norway with headquarters in Iceland. Arctic Fish´s headquarter is located at Sindragata 10, 400 Isafjordur, Iceland.

The consolidated financial statements of the Group were authorised for issue in accordance with a resolution of the Board of Directors.

Note 2 Accounting Principles

The structure of the Group was changed in 2021. Arctic Fish Holding AS is a newly established entity that owns 100% of the shares in Arctic Fish ehf. the Icelandic mother company of the Icelandic subsidiaries Arctic Oddi, Arctic Smolt and Arctic Sea Farm.

In the consolidated financial statements of Arctic Fish Group the values of Arctic Fish Iceland and subsidiaries are continued. The Group has accounted for the reorganization as a continuation of Arctic Fish ehf. The consolidated financial statements are presented as if the Group and Arctic Fish Holding AS as the parent company, had always existed.

Comparative financial information is provided for the preceding period in the Consolidated statement of comprehensive income, Consolidated statement of financial position and Consolidated statement of cash flows.

These condensed, consolidated interim financial statements have been drawn up in accordance with International Financial Reporting Standards (IFRSs) and such interpretations as are determined by the EU and published by the International Accounting Standards Board, including the interim reporting standard (IAS 34). The interim financial statements do not include all the information required of an annual financial report.

The condensed consolidated interim financial statements have not been audited. As a result of rounding differences, numbers or percentages may not add up to the total.

The consolidated financial statements are presented in EUR which is the functional currency of the Group since 01.07.2023 where the Group converted the operational currency to Euros (EUR) from Norwegian Kroner (NOK).

Note 3 Estimates and Risk Exposure

The preparation of financial statements in accordance with IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting principles and recognised amounts of assets, liabilities, income and expenses. The most significant estimates relate to the valuation of biological assets. Estimates and underlying assumptions are reviewed on an ongoing basis and are based on the management's best assessment at the time of reporting. All changes in estimates are reflected in the financial statements as they occur.

Arctic Fish is exposed to a number of risk factors: Operational risks, licenses, legal and regulatory framework and financial risk. The "Operational risk and risk management" section in the Annual Report contains a detailed description of risks and mitigation actions.

Note 4 Biological Assets

(EUR '000)	TOTAL
Net fair value adjustment biomass in the statement of comprehensive income
Q2 2024	-4.363
Q2 2023	4.238
YTD 2024	-2.972
YID 2023	રેરે
2023	-412
Volumes of biomass in sea (tonnes)
30 June 2024	10.288
31 March 2024	8.883
31 December 2023	9.747
30 June 2023	9.194
Fair value adjustment on biological assets in the statement of financial position
30 June 2024
Fair value adjustment on biological assets	11.853
Cost on stock for fish in sea	60.276
Cost on stock for freshwater and cleanerfish	4.213
Total biological assets	76.343
31 March 2024
Fair value adjustment on biological assets	16.216
Cost on stock for fish in sea	47.756
Cost on stock for freshwater and cleanerfish	6.416
Total biological assets	70.388
31 December 2023
Fair value adjustment on biological assets	14.825
Cost on stock for fish in sea	46.607
Cost on stock for freshwater and cleanerfish	4.471
Total biological assets	65.903

Note 5 Financial Items

(EUR '000)	Q2 2024		Q2 2023 YTD Q2 2024 YTD Q2 2023		2023
Interest expenses	-2.392	-2.336	-4.819	-4.253	-9.528
Interest expenses leasing (IFRS 16)	-6	-6	-	-	-15
Net interest expenses	-2.398	-2.342	-4.831	-4.264	-9.543
Net currency effect on long term positions		-3		-9	-2
Net currency effects on short term positions	4	-1.722	-255	-1.780	-2.245
Currency effects on leasing (IFRS 16)		-11		-23	-4
Net currency effects	4	-1.736	-255	-1.811	-2.250
Net other financial items	-2	-13	-4	-23	243
Other financial items	-2	-13	-4	-53	243
Net financial items	-2.395	-4.091	-5.090	-6.129	-11.550

Note 6 Share Capital

(EUR '000)			No. of shares Share capital Other paid in capital
Share capital
Issued at the beginning of 2024	31.876.653	3.032	82.709
Changes during the period	O	O	1.790
Issued at the end of period	31.876.653	3.032	84.498

Note 7 Shareholders

Major shareholders as of 30.06.2024:

Name of shareholder	No. of shares	%
MOWI ASA	16.346.824	51,28%
Síldarvinnslan hf. **	10.899.684	34,19%
J.P. Morgan SE **	2.069.647	6,49%
Landsbankinn hf.	475.724	1,49%
lslandsbanki hf.	233.191	0,73%
KVERVA FINANS AS	223.776	0,70%
State Street Bank and Trust Comp	178.500	0,56%
CLEARSTREAM BANKING S.A.	175.041	0,55%
VERDIPAPIRFONDET EIKA SPAR	167.406	0,53%
MP PENSJON PK	165.000	0,52%
PACTUM AS	150.701	0,47%
VERDIPAPIRFONDET EIKA NORGE	121.659	0,38%
PARETO AKSJE NORGE VERDIPAPIRFOND	92.706	0,29%
ROTH	80.000	0,25%
RAMSFJELL AS	40.849	0,13%
Saxo Bank A/S	35.372	0,11%
VERDIPAPIRFONDET EIKA ALPHA	33.705	0,11%
Euroclear Bank S.A./N.V.	29.000	0,09%
DNB Luxembourg S.A.	25.231	0,08%
STRAND	19.198	0,06%
VERDIPAPIRFONDET EIKA BALANSERT	18.432	0,06%
Total 20 largest shareholders	31.581.646	99,07%
Total other	295.007	0,93%
Total number of shares 30.06.2024	31.876.653	100,00%

20 largest shareholders list includes nominee accounts that are composed of multiple individual shareholders.

**Síldarvinnslan hf is a part of the nominee account "J.P. Morgan SE".

Arctic Fish Holding AS does not own any of its own shares.

Note 8 Share Price Development

Share price development at Euronext Growth (ticker AFISH)

Forward looking statements

This quarterly report includes forward-looking statements that reflect the Company's current views with respect to future events and financial and operational performance. These forward-looking statements may be identified by the use of forward-looking terminology. These forward-looking statements are not historic facts. The forward-looking statements are not guarantees of future performance. The Company's actual financial position, operating results and liquidity, and the development of the industry in which the Company operates, may differ materially from those made in, or suggested, by the forward-looking statements. The Company cannot guarantee that the intentions, beliefs, or current expectations upon which its forward-looking statements are based will occur. By their nature, forward-looking statements involve, and are subject to, known and unknown risks, uncertainties, and assumptions as they relate to events and depend on circumstances that may or may not occur in the future. Because of these known and unknown risks, uncertainties and assumptions, the outcome may differ materially from those set out in the forward-looking statements. These forward-looking statements speak only as at the date on which they are made. The Company undertakes no obligation to publicly update or publicly revise any forward-looking statement, whether as a result of new information, future events or otherwise. All subsequent written and oral forwardlooking statements attributable to the Company or to persons acting on the Company's behalf are expressly qualified in their entirety by the cautionary statements referred to above and contained elsewhere in this report.

Q2|2024 Report

Q2|2024

22