Annual Report • Mar 24, 2022
Annual Report
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A major event for Gigante Salmon AS in 2021 was its listing on the Oslo Børs — Euronext Growth. The company officially began trading on Euronext Growth on 5 July 2021 under the ticker symbol GIGA after a successful issue of NOK 222m. The company experienced great interest from the market in connection with the raising of capital and was oversubscribed several times. In addition to the issue amount, NOK 65m in equity was injected at the end of 2021. The capital secures financing for development projects in the wholly owned subsidiary Gigante Salmon Rødøy AS in accordance with the investment forecast of NOK 445m. In addition to this, an agreement has been entered into for operational financing of NOK 140m, which will fully finance the company and operations until planned full production beginning in 2025.
With the raising of capital and listing on Euronext Growth, the companies operations and activities have centred on construction of the Gigante Salmon Rødøy AS production facility. Construction began as planned on 1 September.
This annual report will provide in-depth information about the status of the project and further plans.
I welcome all established and new shareholders to the first Gigante Salmon AS (GIGA) annual report as a listed company.
The annual report 2021 has been prepared in both Norwegian and English. In case of any discrepancy between the two versions, the Norwegian version shall prevail. Photo: Kristoffer Arntsen and Gigante Salmon AS Helge E. W. Albertsen
Adm. Dir.
I have been a salmon farmer since the 1980s and have been through all the ups and downs this industry has been through. From the start, with small cages in the sea, feeding by hand and processing at fish piers along the coast, to larger production units, state-of-the-art technology and fish feed made using certified ingredients.
I t is exciting to see how important the aquaculture industry has become for Norway's coastal communities in just a few decades; there are now lights in the windows of buildings that had fallen dark. At the same time, it has been a wake-up call for me to realise that many coastal communities have become dependent on an industry that is so exposed to risk, be it political, biological, economic or commercial. Nothing is without risk, and trees don't grow to the sky, so, when we build for the future, we must think long-term, and come up with good solutions that can withstand the risks we face.
Now we stand on the threshold of a new era for Norwegian salmon farming as we start to move production on land. If we are to succeed in building a future for the coastal communities of Nordland, we must give the industry a long-term perspective and make it sustainable. I am focused on linking the three pillars of sustainability — economy, society and environment; we cannot address one without the other two. A project will have trouble being socially sustainable if it is not economically sustainable, and there is no value in a project that is profitable if it destroys the environment. Everything is connected, and that holds true for our industry as well.
My wife and I were hiking in the mountains of Rødøyløva in 2016, and we, like others who have taken that hike, were greeted by sweeping vistas in all directions. This fantastic coast has been our livelihood longer than we can imagine, from long before the Vikingsß all the way up to modern times. From Rødøyløva, I looked down on the island of Lille Indre Rosøy, and an idea began to take form. What if we managed to use the experience and knowledge from farming salmon in cages in the open water and move the fish ashore, so that we avoided farmed salmon escaping into the wild and the plague of salmon lice?
I had been thinking for a long time about what would be the next stage of development for salmon farming. The only thing I was sure of was that the direction it took needed to be in harmony with salmon's nature. My years in this business have taught me that you can't go too wrong if you have biology and physics on your side, and I was convinced that any new approach to fish farming had to be based on giving fish ample access to fresh seawater and a strong current that give the fish the resistance their biology is used to. Both of these inputs are crucial for raising healthy fish, but pumping the amounts of seawater that would be necessary in an on-shore facility requires huge amounts of power.
I went down from Rødøyløva with my wife, and the idea became clearer. I looked to traditional aquaculture to come up with a concept for improving the health of farmed fish that did not require the large amounts of power needed to pump the water this would require.
Raceway systems are used for farming species other than salmon and they could give us the volume of water the salmon needed without requiring it to be pumped up to a height that made the process so energy intensive that it became environmentally unsound. We can also set the water in motion and establish the optimal flow rate for the salmon.
I started by looking at the natural advantages of the coast, and the location of Lille Indre Rosøy makes it the best choice to set up tomorrow's salmon-production facility. The water around the island is deep and will provide us with ample fresh seawater and the strong current need to create an optimal environment for fish. In addition, the low height profile of the fish farm on Lille Indre Rosøy will make it area-efficient. The production in this type a facility is the equivalent of 7.7 standard at-sea sites, but it occupies much less area than a single sea site. We can do this because we have ample access to seawater and a strong current. Once the facility is running at full capacity, it will be able to produce the equivalent of nearly 90 million portions of salmon each year in an area that covers less than 2.8 hectares.
I t is not possible for the salmon to escape from a farm on land. That, coupled with the fact that we will be processing 50% more of the sludge produced during operations than traditional sea-based salmon-farming operations do, mean that the operation will have a net environmental benefit — both because of reduced sludge emissions and because the faeces and feed residues can be used as resources in other contexts. I recall well how in the old days that sludge was released directly into the sea or into harbours, whereas today it is turned into high-quality ingredients for health food, medicine and enzymes. In future, I envision us processing all of the by-products of our production in this same way as part of a circularresource economy.
Globally, food production accounts for more than 30% of greenhouse-gas emissions. In Norway, we are lucky to have such good conditions for producing food with a low climate footprint. There are also no other industrially produced proteins that are as climate-friendly as salmon, but that does not mean that we should underestimate that aquaculture also has some major challenges. I am therefore focused on thinking sustainability into everything we do and to constantly having a long-term perspective. We need to build lasting, viable and equitable solutions that provide sustainable food production, sound finances and vibrant coastal communities.
Kjell Lorentsen Founder and Board member
Gigante Salmon AS currently has two projects in its portfolio: development and operation of Gigante Salmon Rødøy AS, as well as the Gigante Salmon AS-owned site on Feøya island in Gildeskål municipality. An application to request changes to the land-use regulations on Feøya is being compiled.
There are several good reasons why the company is investing in land-based aquaculture and expects this type of activity to grow. A closed on-shore production facility provides better control and makes it easier to monitor production. This makes it possible to more quickly identify challenges and take corrective action when needed. We are of the opinion that land-based aquaculture also provides opportunities for more sustainable fish farming. The ESG section of this report provides more comprehensive information about the sustainability dimension.
The project's innovative concept is based on the flow of fresh seawater, rather than recirculation, and it combines the benefits of conventional and land-based aquaculture. The chosen technological solution reduces the challenges of lice infestation, escape, discharge and other environmental impacts associated with traditional at-sea farming.
IMPLEMENTATION OF THE PROJECT
Construction of the Gigante Salmon Rødøy AS production facility is well
underway. On 1 September 2021, construction began on Lille Indre Rosøy, a small island northeast of Rødøy. Gabbro Nor AS is the general contractor.
Important areas of responsibility for Gigante Salmon AS as the project's owner is undoubtedly health, environment, safety and quality. It is the company's ambition to avoid all injuries and incidents involving people, the environment and equipment. The safety of our employees and our responsibility to the community will always have highest priority.
To date, no absence or personal injuries stemming from undesirable or serious work-related incidents have been reported.
The project is moving forward in accordance with the prepared and agreed-on work schedule and within the planned and agreed-on budget.
The contract for the housing and production fleet was awarded to Endur/ Sjøsterk and was signed on 26 January 2022 for delivery in May 2023.
There will be a high level of activity in the period up to the summer of 2022. Design activities are underway that will result in further contracts being signed in Q2 and Q3 of 2022. Implementation, fabrication and installation will mainly start in the autumn of 2022 and continue until the summer of 2023, with subsequent system testing and commissioning ahead of the start-up of the plant in the autumn of 2023.
An overriding focus for all our activities is that the health of our fish is crucial for our success: "If the fish are doing well, then we are doing well."
• The demand for salmon expected to stay strong due to increased focus on sustainability and health.
Gigante Salmon AS follows Euronext's guidelines for ESG reporting, updated in January 2020.
Our principles for reporting are rooted in a value-based business philosophy that sustainability lays the foundation for everything we do.
The company was listed on Euronext Growth on 5 July 2021 and is in an establishment phase where the main focus is organisational development and construction of the Gigante Salmon Rødøy AS production facility. The first part of the facility will be ready in the second half of 2023, and the entire facility will be completed by the autumn of 2024.
The Transparency Act on Social Sustainability enters into force on 1 July 2022, and we have begun to assess what that will require of our business.
Gigante Salmon AS is currently not in an operating phase, and we are working to establish specific ESG reporting principles that can document how we work in the construction phase and what objectives we have for the operating phase. We will strive to establish a reporting standard based on GRI, but this will be just one of several measures and tools that support the company's sustainability strategy.
Gigante Salmon AS intends to be certified according to the Global GAP standard. We are also considering which other certifications and / or standards are relevant for documenting and reporting the high quality of the product we produce.
Our product, salmon, is the most climate-friendly animal protein on the planet1 . It is important to contribute to more of the world's food supply being produced in a way that does not emit excessive amounts of COe, consume large amounts of fresh water or impact the planet and its future in other ways.
Salmon is a high-quality food that contributes to better public health2 .
Salmon feed accounts for the largest share of greenhouse-gas emissions emitted by salmon farming3 , and a salmon's carbon footprint is therefore closely related to what it eats.
In 2022, we will lay the foundation for good choices when it comes to the feed our salmon will eat. In our choice of feed, our priorities are nutrition and the health of the fish. Secondly, we consider the impact on the environment and climate, and we intend to contribute to the work done to develop new and alternative feed ingredients that are better for the climate while also ensuring the health of the fish and providing it with proper nutrition.
Our feeding strategy will also focus on avoiding feed loss. Feed is resource and not using it efficiently wastes money and harms the environment. Farming in a basin on land makes monitoring of feed waste much easier than in traditional cage farming, and this means that we can monitor any feed waste and quickly implement measures to prevent it.
Optimal feed utilisation is a prerequisite for sustainable protein production. A common way to measure this is a Fish In Fish Out (FIFO) ratio. This shows how many kilograms of wild fish in the form of fishmeal and fish oil are used to produce one kilogram of farmed salmon. The rate is affected by how much flour and oil the producers get out of the wild fish used to produce the feed, how much of this is used in the feed and how rich in fat the wild fish are.
Another way to measure feed utilisation is to calculate how much of the nutrients from the feed are left in the salmon. Studies show that 24% of the energy and 27%
of the protein contained in feed is passed on to the edible part of the salmon, the fish meat. The salmon transfers more energy, proteins and phosphorus from the feed to the meat than chickens and pigs do, and this therefore makes the salmon the most resource-efficient source of meat4 . We will work to increase resource efficiency further and to reduce the greenhouse-gas emissions that stem from our operations.
Salmon farming on land gives us better control over the discharge from our production. Initially, we will collect 50% of our discharge for processing, but we will seek to increase this amount. Feed waste and faeces are resources, and we see them as part of a circular economy.
l. https://www.fairr.org/index/company-ranking/
2. https://laksefakta.no/sunnhet-og-helse/laks-til-middag/
3. https://www.sintef.no/contentassets/0ec2594f7dea45b8b1dec0c44a0133b4/report-carbon-footprint-norwegian-seafood-products-2017\_final\_040620.pdf 4. https://laksefakta.no/hva-spiser-laksen/er-lakseforet-barekraftig-er-det-villfisk-i-lakseforet/
The seabed and currents around Lille Indre Rosøy have been mapped in order to identify how discharge will be spread. A baseline survey has been carried out using the MOM-B method. This is a preliminary mapping of the seabed conditions prior to the plant's start-up and provides a good basis for assessing what effects our operations are having on the seabed.
The surveys around Lille Indre Rosøy have been carried out by Akvaplan-Niva, which is accredited to carry out this type of survey.
Our aquaculture permit requires us to treat the water we release and to document that we have done so. After the start of operations, mandatory environmental monitoring tests will be carried out on a regular basis as described in the discharge permit issued by the county governor of Nordland.
Environmental monitoring will be conducted by accredited firms.
Many species of seabirds are undergoing significant population declines5 . As a company, as representatives for northern Norwegian coastal communities and as individuals living there, we are concerned about this decline. We will contribute to the understanding of this decline and consult with relevant authorities to assess what we, as a company, can contribute to mapping the situation and remedying it. We would like to lay the foundation for constructive co-operation with other stakeholders and civil society when it comes to addressing this problem.
Blasting at Lille Indre Rosøy is not conducted between 1 March and 1 September so as not to disturb nesting seabirds.
Escaped farmed salmon is a problem because it can have an impact on wild salmon. Spawning farmed salmon that escape from fish farms contaminates the genetics of wild
salmon. Additionally, if escaped salmon carry a parasite or virus, they risk passing it on to wild salmon.
Our technology allows us to capitalise on the benefits of salmon farming on land while at the same time minimising power consumption. Our permit requires that the bottoms of the facility's basins are above the highest astronomical tide. This is a requirement we have met. Our plans call for the establishment of a low-profile raceway system that is spread out over a large area. We use low-energy power converters to maintain an adequate rate of flow. The water is not heated; we produce salmon at natural temperatures. This allows us to keep our power consumption relatively low.
The industry standard for power use in land-based fish farming is 6-8 kWh per kilogram of salmon. Calculations show that our plant at full production (up to 20,000 tonnes per year) will use 2 kWh to produce one kilogram
of salmon. At the 1/3 production level we will start with, power consumption will be higher.
Our technology is energy efficient, but we want to reduce power consumption further, and we are therefore working on a solution for energy regeneration that would make this possible.
We are in the process of establishing a submarine cable that would supply Lille Indre Rosøy with power from the mainland. Our goal is to have access to renewable energy through the power grid on land when operations commence in the autumn of 2023.
Raising fish for commercial purposes requires ethical considerations be made to ensure their health and well-being. Fish mortality in the aquaculture industry is too high. The company wants to reduce mortality and will work with the industry and the authorities to accomplish this.
It is our duty and responsibility to make sure that the salmon we raise live a good life. Our technology is therefore developed to provide the salmon with abundant amounts of fresh, clean seawater from Helgeland. An optimal current speed gives the fish the resistance their biology is used to and allows them to remain healthy. Salmon living in the proper conditions are healthier and grow well.
In order to minimise the risk of salmon lice (nauplii) infections, we will draw the water we use in our facility from a depth of 20 metres, which is below the range of salmon lice. An environment that is free of parasites — and the treatment required to eliminate them — is better for farmed salmon.
Waste sorting: The project involves waste sorting during the construction phase and the operating phase, and we will comply with all requirements and expectations. Building regulation TEK17 contains a requirement that a
minimum of 60% of construction waste (by weight) be sorted during the construction phase. Waste is to be sorted at a suitable place on the construction site. We will classify waste according to whether it can be delivered to a local waste-management facility or needs to be transported to waste-management facilities in other areas.
We have not yet completed our plan for sludge management. In the project, sludge is considered a resource that has a high value as a part of a circular economy. Our plan is to separate liquid and dry matter locally and to deliver the dry matter to a processor. However, we are also considering other options, such as using the sludge in the production area to increase value creation and reduce transport and associated emissions.
The only source of pollution that has been identified in the area in connection with construction is dust. Rock displaced by the construction will be temporarily stored on the island and partly used as landfill, subject to approval. This involves a marginal risk of pollution.
Noise limits from the operation of aquaculture facilities are defined by the Pollution Control Act. They are stated in the
permits issued by the county governor. Since power will be supplied from the mainland via a submarine cable, diesel generators will not be required.
Construction will entail noise from blasting and heavy machinery. Noise-reduction requirements apply mainly to weekend and evening activities, in particular activities involving well boats in connection with the loading and unloading of sludge and fish. During the construction phase, we will strive to use of low-noise working methods and equipment.
The project has prepared a comprehensive plan that places considerable focus on the appearance of the production facility. The facility will only be partly visible from the shipping lane and has been given a design and layout that takes into account and is adapted to the surroundings.
The largest source of light will come from the lighting used to ensure the well-being of the fish, particularly during growth periods. In the operating phase, it is crucial to establish a lighting-control strategy that ensures optimal growth. We are considering submerged lighting to reduce light scattering. Beyond this, no more light than necessary will be used during operations, especially in winter and periods of darkness.
Our wholly owned subsidiary Gigante Salmon Rødøy AS is building a fish farm on Lille Indre Rosøy, in Rødøy municipality. Construction started in September 2021. We expect operations to begin in the second half of 2023.
All necessary permits for establishment and operation have been obtained.
The detailed zoning plan for Lille Indre Rosøy was adopted by Rødøy municipal council on 13 September 2019.
Gigante Salmon Rødøy AS is licenced to produce a maximum of 13,731 tonnes of biomass (maximum allowable biomass, or MAB). The Norwegian Food Safety Authority has limited MAB to 3,600 tonnes during the first 24 months of operation for testing.
The county governor of Nordland has granted a discharge permit in accordance with the Pollution Control Act for a biomass of 13,731 tonnes of MAB, based on an annual production of 19,088 tonnes of salmon and feed consumption of 20,283 tonnes.
The aquaculture permit was granted by the Nordland county authority on 12 January 2021.
Our control authorities are the Norwegian Food Safety Authority, the Norwegian Directorate of Fisheries, the Norwegian Labour Inspection Authority, the Nordland County Governor and other authorities.
We stand on the shoulders of the generations of coastal residents before us who have harvested nature's bounty and been subject to nature's forces. Nature's resources make our business possible.
We work with local authorities, other companies and stakeholders to ensure the viability of Rødøy through housing construction and by taking steps to improve in-migration, such as making it an attractive place for families that offers a high quality of life and close-knit community.
We care about the people we work with, our partners and the communities where we do business. We are a responsible member of the community who works to ensure that others experience us as predictable, accountable and active. We comply with the regulations that govern our activities.
One of the guiding principles of our business is our commitment to doing business locally or regionally whenever possible. We want to be an asset and for other businesses to benefit from our presence. Meeting the UN Sustainable Development Goals or own goals of building good local communities will not be possible unless we work with local stakeholders.
We are proud to be working with Rødøy municipality, and we openly encourage our employees to live in the community where their workplace is located and to be a part
We have an obligation to contribute to our community and we believe our presence and commitment should be an asset for the region where we do business.
ENVIRONMENTAL, SOCIAL, GOVERNANCE
of what happens there. We do this because we know that employees who live in the community where they work have a greater commitment locally, and they can add value to it. Our company is obliged to remain a long-term asset for Rødøy, its residents and its authorities.
After the balance date, we hired three new employees, all of whom relocated to Rødøya bringing with them two families and a total of nine people. When making new hires, we will continue to take into account whether candidates live in Rødøya or are willing to relocate there.
A study by BRUS, the regional development authority for Bodø, of the knock-on effects of our establishment in Rødøy reckons that it will lead directly to the creation of 15 jobs in Rødøy and 75 jobs in Nordland county through increased demand for broodstock, hatcheries, fish feed, wellboats, sludge processing, transport, export and processing.
Our employees can safely express themselves on the job, and we have established routines for reporting work-place incidents.
We are an open organisation that does not discriminate against anyone based on religion, ethnicity, sexuality or gender. Our ethical guidelines lay the foundation for the work of preventing discrimination.
Our compensation is based on applicable industry standards, and we strive to avoid wage differences between genders.
Our employees are encouraged to organise.
In the spring of 2022, Gigante Salmon AS has one student in an internship, and we want to continue hosting interns who are studying relevant fields.
When we begin production, we will apply to be approved to host apprentices.
When relevant, we will facilitate on-the-job training for our employees who do not have formal competences. We also intend to employ people who may have gaps in their CVs and help them obtain formal competences in a relevant subject area.
Co-operation with the community is important to us because it gives us a stronger foothold and input that is useful in our work.
Gigante Salmon AS is working to establish a power cable from the mainland to the plant on Lille Indre Rosøy. The cable will run via Rødøya, increasing the capacity of its power grid and improving the security of its power supply.
Research and development is often associated with new — and unproven — ideas and technologies. While Gigante Salmon AS uses tried-and-true technology throughout our operations, they are combined in a way that has never been tried. A natural part of traditional project work consists of activities like development, optimisation and identification of possible future activities, including the company's assessments of power re-generation and continued improvements in water purification.
The company is open to contributing to or participating in research projects when needed or where natural. We recently began participating in a project dealing with oxygen uptake when in the form of nanobubbles in order to improve land-based production. Gigante Salmon AS is part of this collaboration.
We have built a scale (1:5) version of the raceway to test the dynamics of the basin design and sedimentation. The results of these tests are compared with simulations and calculations performed by Sintef in order to obtain the best possible basis for decision-making prior to establishment.
Sustainable workplaces and societies are a matter of local value creation and quality of life for individuals and families. This is important for Gigante Salmon AS both as an employer, community stakeholder, producer of healthy food and as the steward of an area of environmental and natural value.
Our employees are important members of their communities and important partners for us as we seek to create a good workplace and contribute to a resilient community.
We collaborate with Rødøy municipality and the local committee on Rødøya, and we will work with other stakeholders when relevant and natural.
We hold public meetings on Rødøya at least twice a year in order to engage in a conversation with members of the community about our business and our plans for the future.
Gigante Salmon AS shall maintain a high standard of corporate governance. The board has the overall responsibility for this and, together with the company's management, carries out an annual evaluation. Gigante Salmon AS follows the 17 October 2018 recommendations of NUES (the Norwegian Corporate Governance Board)6 . Instances in which we do not follow the recommendations will be identified, and we will provide a justification and an explanation for why we do not.
Gigante Salmon AS will run land-based salmon farming. The company's articles of association are published on our website7 .
We are licenced to produce 13,731 tonnes of biomass (MAB) on Lille Indre Rosøy, in Rødøy municipality, in Nordland county. During the first two years of production we a permitted to produce 3,600 tonnes of biomass. This will mean an annual production of approximately 6,000 tonnes during the first phase (gross weight).
driving consideration is the well-being of the fish. We are developing a new concept for the production of salmon in raceways on land. The low level of investment required to raise a kilogram of fish in these raceways reduces the financial risk. A high flow-through rate and current velocity in raceways are key elements in our strategy for ensuring fish health.
Our value base emphasises consideration for the outside world in value creation. We are proud to come from northern Norway. In addition to good earnings, we are motivated by building businesses and vibrant coastal communities. We want to be remembered as being:
Creative: We seek new solutions to create a better business. We are motivated by doing business with others. Our stakeholders should feel that we have done more than create a business for our own benefit. We dare to go down new paths, and we and rely on our own abilities to drive development.
Responsible: Employees deserve good jobs. The fish we raise should be healthy. We will minimise the impact of our operations on the natural environment. Our suppliers and customers must find us credible and fair.
The company has prepared an investment and operating budget for its planned activities. The capital raised in the summer of 2021 and the established loan agreements have given the company sufficient financing for both the construction and operating phases. Routines have been established for cost control and risk management during the construction phase.
The company will start production in the second half of 2023 with ready-to-process fish expected towards the end of 2024 and through the spring of 2025. The company will therefore not pay dividends in this build-up phase until 2025. As of today, the board has no authority to distribute dividends, increase share capital or acquire own stock.
In connection with the company's raising of capital, all shareholders were treated equally. The issue was handled through a facilitator. The company has not had transactions in its own shares. Transactions with related parties have taken place through normal trading on the stock exchange and have been notified in accordance with regulations.
The company's shares are listed on the Euronext Growth market without restrictions on the right to own shares. A share entitles the holder to one vote. In connection with the raising of capital in July 2021, the main shareholder (Gigante Havbruk AS) and the company's CEO, CFO and chairman of the board have a one-year lock-up on their shares.
In 2021, the company held five extraordinary general meetings in addition to the annual general meeting. A comprehensive overview is given below with agenda and ownership.
During the first four general meetings, Gigante Havbruk was the sole owner and the events of these meetings will not be detailed further.
In connection with the decision to increase capital, the shareholders were sent case documents one week before the general meeting and given the opportunity to attend, appoint a proxy or vote in advance on the individual cases. The notice for the December EGM was sent out two weeks in advance. Case documents were made available via the company's website and shareholders had the opportunity to attend, appoint a proxy or vote in advance on the individual cases. The chairman of the board attended the general meetings. In 2021, the company did not have a nomination committee. The chairman of the board chaired the general meetings.
The board encourages shareholders to participate in general meetings and will continue to hold meetings, but it will also permit those who are unable to participate to vote by proxy or in advance. Furthermore, the board will propose that a nomination committee be established and that arrangements be made for shareholders to elect independent chairmanship of the meeting.
| tonnes during the first phase (gross weight). | customers must find us credible and fair. | 22 March 2021: Auditor selected (Gigante Havbruk is 100% owner) |
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|---|---|---|---|---|
| Construction of the facility began in September 2021, and it will be stocked in the second half of 2023. The goal is to harvest the first fish in the autumn of 2024. In the following phase, starting in 2027, we expect to produce up |
Competent: We have been farming salmon for many years, and we continuously seek to learn more by keeping up to date through collaboration with professionals in other fields. We behave, and our decisions are based on |
9 April 2021: | Annual general meeting with the standard points on the agenda (Gigante Havbruk is 100% owner) |
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| to 20,000 tonnes of salmon annually. | knowledge and experience. The board of directors evaluates objectives with |
11 May 2021: | Registration of shares with the Norwegian Central Securities Depository and amendments to the articles of association |
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| IN 2027, WE WILL PRODUCE 20,000 TONNES OF SALMON | associated strategies and risk on an annual basis. The | (Gigante Havbruk is 100% owner) | ||
| The company's strategy is to achieve a high level of pro fitability through a low level of investments and optimal |
board prepares an annual report about environmental and social responsibility. |
11 June 2021: Election of board of directors (Gigante Havbruk is 100% owner) |
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| fish health. During the current phase of the project, our | 28 June 2021: Capital increase (dispersed ownership) | |||
| 6. www.nues.no | 17 Dec. 2021: Election of board of directors (the company is listed on Euronext Growth) |
the company's website. |
The company does not have a nomination committee and the board will propose to the general meeting in 2022 that the general meeting resolves to establish a nomination committee in line with the recommendations of NUES.
The board is chaired by Eirik Sørgård. The ordinary members of the board are: Kjell Lorentsen, Kristin Ingebrigtsen and Liv Monica Stubholt. Ingebrigtsen and Stubholt are independent/external board members. They do not own shares in the company. Lorentsen is the company founder and CEO of Gigante Havbruk AS, which owns 60.9% of the shares in Gigante Salmon AS. Lorentsen is not employed by the company, but he is actively involved in designing solutions during the construction phase. Sørgård is the CEO of KapNord AS, which is 51% owned by Gigante Havbruk AS and is consequently not classified as independent. Sørgård owns 200,000 shares through the company Pronord AS. Senior executives are not members of the board. Sørgård, Ingebrigtsen and Stubholt were elected to the board for the first time in 2021. Lorentsen has held board positions in the company since its establishment in 2001.
In sum, the board has considerable expertise in fish farming, finance and legal matters. In addition, the board has expertise in ESG and society's expectations in all three areas. The board's expertise is discussed in more detail on
The general meeting elects a chair of the board. Members of the board are elected for a year at a time. The board has been fully present at the board meetings.
The board has established instructions for the work of the board. Instructions and a proxy framework have been established for the CEO. Each individual board member is conscious of impartiality considerations in line with the provisions of the law, and the board addresses impartiality issues that may arise when purchasing goods and services where, for example, Gigante Havbruk AS has ownership interests and influence. The company did not have an audit committee in 2021, but a committee composed of two members of the board was established in 2022. The board does not have its own compensation committee as senior executives are employed on market terms without option agreements or other bonus schemes. The board does not plan to establish such a committee. The board conducts an annual evaluation of its own work.
The company is now in a construction phase and the facility is expected to be completed and prepared for the start of production in the autumn of 2023. A separate management document has been established for this development with routines for cost control and risk management with associated routines for reporting this. External relations, including communication, is addressed in the document through defined objectives with associated priorities and action plans. Routines have been established for monthly reporting on costs, investments and progress compared with budgets and plans. The board reviews the risk areas and the control system on a regular basis and its assessment is included in the annual report.
Members of the board receive a fixed fee as well as variable remuneration based on the amount of time used. At the extraordinary general meeting on 17 December 2021, a fee of NOK 100,000 per member was approved. In addition, members of the board are reimbursed based on the amount of time, for lost earnings or remuneration. Payment is made quarterly.
No board fees based on this decision have been paid as of the balance sheet date. No board fees have been booked in the accounts for 2021.
As chair of the board of a company in the establishment phase, Sørgård is also actively involved in the design and selection of various technical solutions. This work is invoiced by Sørgård's employer, Kapnord AS, and not Sørgård personally. Work is invoiced on an hourly basis. The cost is entered as part of the investments in the subsidiary Gigante Salmon Rødøy AS. The board of Gigante Salmon AS has approved this scheme and the board is presented with quarterly time sheets related to this scheme.
The company has not established incentives for share purchases by members of the board. The chair receives the same compensation as other members of the board.
The board has not prepared its own guidelines for senior executives. Senior executives receive additional benefits (insurance, pension etc) on market terms as part of their remuneration. No option or bonus programs have been established.
Gigante Salmon AS strives to ensure that all shareholders receive the same information at the same time. General guidelines have been established for reporting information about the company, with a particular focus on financial information.
Routines have been established for contact with stockbrokers and financial institutions, as well as communication on social networks and the company's website.
In general, the company follows "The Oslo Børs Code of Practice for IR", published in July 2019.
The board has not prepared its own routines for any takeover bids, but, in the event this happens, it will refer to the principles established by NUES.
The company's auditor is PwC. An annual plan has been established for the audit and the auditor's participation in board meetings. The auditor attends the AGM.
Helge E. W. Albertsen CEO
Broad experience from project management & control in businesses as Equinor ASA, Bodø Energi AS and Avinor.
MSc from Nord University Business School. Experience from Salten Aqua AS, Insula AS and Equinor ASA.
Chairman of the board
Broad experience from the marine sector, oil & gas, IT and finance. CEO of Pronord AS and
KapNord AS. Board member in several companies within the marine sector.
Board member
Founder and CEO of Gigante Havbruk AS, established in 1988.
Has worked within fisheriesand aquaculture business since the 1970s.
Former business adviser in Sparebank 1 Nord-Norge. Former director of HR, strategy and market in North Energy ASA. Long experience from asset management.
Stubholt is partner in law firm Selmer AS and she is head of the firm's ESG group.
She serves on the nonexecutive board of several companies in the energy and seafood industries.
is a land-based salmon farming company with its first production facility under construction on Lille Indre Rosøya in Rødøy in Norway. The company's aquaculture concept is based on a flow-through system that combines the benefits of both conventional and land-based aquaculture, and eliminates challenges associated with conventional sea-based farming, ie lice and escapes, while reducing mortality, emissions, feed loss and strain on the local environment.
| 2021 | 2022 | 2023 | 2024 | 2025 2026 |
2027 | |
|---|---|---|---|---|---|---|
| CONSTRUCTION PHASE |
Project execution phase | |||||
| Startup production – 1.1 mill smolt | ||||||
| Slaughter 5,300 tons HOG | ||||||
| Startup production – 1.1 mill smolt | ||||||
| PRODUCTION PHASE 1 |
Slaughter 5,300 tons HOG | |||||
| Full production – 3.3 mill smolt | ||||||
| FULL PRODUCTION |
| # | Agreement | Counterparty | Ownership |
|---|---|---|---|
| 1 | Management agreement | Salten Aqua AS | Gigante Havbruk AS owns 35% of the shares in Salten Aqua AS, directly and indirectly. |
| 2 | Smolt agreement | Grytåga Settefisk AS | Gigante Havbruk AS owns 51% of the shares in Grytåga Settefisk AS, directly and indirectly. |
| 3 | Slaughter agreement | Salten N950 AS | Gigante Havbruk AS owns 28% of the shares in Salten N950 AS, directly and indirectly. |
| 4 | Research Agreement | Gildeskål Forskningsstasjon AS Gigante Havbruk AS owns 100% of the shares in Gildeskål Forskningsstasjon AS. |
Other relevant agreements with related parties are assessed continuously as needed
| PHASE 1 | FULL PRODUCTION | ||
|---|---|---|---|
| Investment | 445 MNOK | No additional investments required | |
| Smolt released | 1 100 000 | 3 300 000 | |
| Harvest (tons, WFE) | 6 350 | 19 050 | |
| Harvest (tons, HOG) | 5 300 | 16 000 | |
| Utilisation MAB | 0.5X | 1.4X | |
| Prod. costNOK/kg HOG | 38 | 31 | |
| CAPEX/kg HOG | 71 | 24 | |
| 2023 | 2025 2027 |
Last year marked many important milestones for Gigante Salmon AS. Following the successful emission of NOK 222m in shares in June, the company was admitted to trading on Euronext Growth Oslo on 5 July. The issue secured the company's long-term financing, which, in addition to financing for the construction phase, includes an operating credit of NOK 140m. This meant that the company was able to mark the start of construction on Lille Indre Rosøy on 1 September and is on track for the introduction of smolts in autumn 2023.
Through its wholly owned subsidiary Gigante Salmon Rødøy AS, Gigante Salmon AS has an aquaculture permit on Lille Indre Rosøy to produce 13,731 tonnes (MAB) of food fish, with an annual production of approximately 19,000 tonnes. The company's aquaculture concept is based on the flow of fresh seawater, rather than recirculation, and it combines the benefits of conventional and land-based aquaculture. The chosen technological solution reduces the challenges of lice infestation, escape, discharge and other environmental impacts that are associated with traditional at-sea farming. This provides an optimal living environment for fish, which is crucial for success.
An investment in the construction phase of NOK 445m is significant for a coastal municipality with 1,200 inhabitants. So too are the 15 jobs created as a direct result of the operating phase and the knock-on effects for related industries. A study by BRUS, the regional development authority for Bodø, of the knock-on effects of our establishment in Rødøy reckons that it will lead directly to the creation of 75 jobs in Nordland county. We are proud of this.
Together with our dedicated employees, we invest in salmon, the coast and the future.
Gigante Salmon AS is a Norwegian company listed on Euronext Growth Oslo under the ticker symbol GIGA.
In addition to Gigante Salmon AS, the group consists of the following, wholly owned subsidiaries:
The company's operations take place in Bodø and in Rødøy, in Norway. The head office is located in Bodø.
During the year, Gigante Salmon Rødøy AS started construction of the group's first land-based aquaculture facility, located on Lille Indre Rosøy, in Rødøy municipality. Construction is expected to take just under two years, and the company is planning to introduce smolts in autumn 2023.
As the group is still in the establishment phase, sales revenues compared with the previous year were NOK 0. Activation of own work related to the development project gave a total turnover of NOK 1.9m, compared with NOK 0 in 2020. The annual result was NOK 2.7m in 2021, compared with NOK -0.5m in 2020. The increase is due to negative tax expense as a result of capitalised deferred tax benefit.
Total cash flow from group operations was NOK -1.8m, corresponding to the operating profit. The total investments in the group in 2021 were NOK 20.1m, of which NOK 19.2m is related to the group's development project in Rødøy.
The group's liquidity as of 31 December 2021 was NOK 258.7m. The group's ability to self-finance investments is considered good.
The group's short-term debt on 31 December 2021 amounted to 100% of total debt in the group, compared with 4% on 31 December 2020. The increase is related to accounts payable, public taxes and holiday pay, and is a natural consequence of the group's increased activity. Approved loans for construction have yet to be disbursed, and, consequently, all debt is short-term. The group's financial position is good, and, on 31 December 2021, the group was able to repay short-term debt using its most liquid assets.
Total capital at the end of the year was NOK 290.7m, compared with NOK 67.0m the year before. Equity shares on 31 December 2021 was 94%, compared with 97% on 31 December 2020,
See note 6 for further information about share capital and shareholder information.
The market for Atlantic salmon has proven strong during the two years of the pandemic. A healthy and sustainable source of protein is sought after in the market, and, with increased global population growth, the outlook for the coming years is good. The market outlook is therefore considered good.
Research and development is often associated with new — and unproven — ideas and technologies. While Gigante Salmon AS uses tried-and-true technology throughout our operations but they are combined in a way that has never been tried. A natural part of traditional project work consists of activities like development, optimisation and
identification of possible future activities, including the company's assessments of power re-generation and continued improvements in water purification.
The company is open to contributing to or participating in research projects when needed or where natural. We recently began participating in a project dealing with oxygen uptake when in the form of nanobubbles in order to improve land-based production. Gigante Salmon AS is part of this collaboration. We have built a scale (1:5) version of the raceway at Gildeskål Forskningsstasjon AS to test the dynamics of the basin and sedimentation.
Internal control related to financial reporting takes place through the management's daily follow-up and through monitoring by the board. Deviation and points that need to be improved are followed up on and corrective measures are implemented. The company's financial position is good; a financing agreement is in place for the construction and operating phases. In addition, hedging instruments will be considered for use when appropriate.
Gigante Salmon AS is exposed to financial risk in various areas, such as currency risk on imported components in the current, construction, phase. The aim is to mitigate the financial risk to the greatest extent possible. The company's current strategy does not include the use of financial instruments, but this is the subject of on-going assessment by the board.
Russia's illegal invasion has created a humanitarian crisis for the civilian population and triggered extensive sanctions against Russia as well as counter-sanctions by Russia. The situation is still evolving.
The invasion has created unrest in the markets and, with the caveat that the invasion is still at an early stage, the picture is unclear.
Unless the conflict escalates, the company does not see any direct or significant financial consequences. However, we cannot rule out macroeconomic consequences for ourselves or our markets, or increased prices of inputs in the construction and operating phases.
As a third party, Gigante Salmon AS is exposed to exchangerates and commodity-price fluctuations, as several of the components being used during construction phase are imported. This can affect the contract prices charged by suppliers. The company has not entered into forward contracts or other agreements to reduce its currency risk, and thus the operational market risk, as this affects us as a third party.
The company is also exposed to changes in interest rates, as the company's debt has a floating interest rate.
As the group in the current phase has no turnover, and consequently had no receivables on 31 December 2021, the risk of loss on receivables is not relevant.
Liquidity risk is the risk that the group will not be able to service its financial obligations as they fall due. The group's equity ratio, liquidity reserve and current credit facilities mean that the liquidity risk is considered low.
In accordance with Accounting Act sections 3-3a, it is confirmed that the company meets the requirements for continued operations.
This assessment is made on the grounds of the group's financial position and long-term strategic forecasts for the years ahead. The group's financial position is sound.
The board proposes the following allocation of Gigante Salmon AS's annual result:
| Total disposed | 2,739,208 |
|---|---|
| Other equity | 2,739,208 |
Equity at the end of the year amounted to NOK 274.2 million.
Gigante Salmon AS will ensure long-term profitability and growth through sustainable, land-based salmon farming, as well as by acting in socially responsible manner. We feel an obligation to contribute to the community and to strengthen the region where we do our business through our presence and commitment. One of the guiding principles of our business is our commitment to doing business locally or regionally whenever possible. We want to be an asset and for other businesses to benefit from our presence. Meeting the UN Sustainable Development Goals or own goals of building good local communities will not be possible unless we work with local stakeholders.
As an employer, Gigante Salmon AS strives to be a safe, rewarding place to work. It is the company's ambition to avoid all injuries and incidents involving people, the
environment and equipment. The safety of our employees and our responsibility to the community will always have highest priority.
To date, no absence or personal injuries stemming from undesirable or serious work-related incidents have been reported. The group had no sick leave in 2021.
| Gigante Salmon AS | Men | Women |
|---|---|---|
| Gender balance | 2 | 1 |
| Temporary workers | 0 | 0 |
| Part-time workers | 1 | 1 |
| On parental leave | 0 | 0 |
The CEO is a man. The board consists of two men and two women.
The group has a policy of equal pay for equal work. The group's value base forbids acts of discrimination and harassment. As part of the group's efforts to promote gender equality, it constantly seeks to ensure that our male and female employees are satisfied with their working conditions. Gender considerations do not influence decisions about personal development, continuing education or promotions.
The group investigates whether there is a risk of discrimination or other obstacles to gender equality on an on-going basis throughout the year. Sources of risk are identified and measures to reduce the risk are implemented on an on-going basis.
Noise and construction activity in the current phase are within the requirements set by the authorities. There is an order to stop blasting during the breeding season for seabirds (1 March-1 September). The company respects this order and has always incorporated it in its work schedule.
The company's work in the area of organisation and social responsibility, including sustainable communities, the working environment, gender equality and the environment, is described above.
The board of directors and the CEO confirm that the consolidated accounts for the period 1 January-31 December 2021 have been prepared in accordance with generally accepted Norwegian accounting practice and provide a correct picture of the company's assets, liabilities, financial status, income and expenses as a whole. We also confirm that the annual report includes a true and fair view of the company's most important events up to the presentation of the results.
Bodø 23 March 2022
Eirik Sørgård Chairman of the board
Helge E. W. Albertsen CEO
Kristin Ingebrigtsen Member of the board
Liv Monica Stubholt Member of the board
Kjell Lorentsen Member of the board
(Amount in NOK)
| Parent | Group | ||||
|---|---|---|---|---|---|
| 2021 | 2020 | Note | 2021 | 2020 | |
| 2 290 312 | 0 | Revenue | 10 | 0 | 0 |
| 0 | 0 | Capitalized work | 1 | 1 902 416 | 0 |
| 2 290 312 | 0 | Total revenue | 1 902 416 | 0 | |
| 2 113 796 | 469 782 | Employee benefits expense | 7, 9 | 2 128 706 | 469 782 |
| 2 015 | 0 | Depreciation and amortisation expenses | 1 | 31 848 | 0 |
| 1 904 368 | 155 543 | Other operating expenses | 9 | 1 548 164 | 157 756 |
| 4 020 179 | 625 325 | Total operating expenses | 3 708 718 | 627 538 | |
| - 1 729 867 | - 625 325 | Operating profit | - 1 806 302 | - 627 538 | |
| 174 969 | 5 248 | Interest income | 848 011 | 6 112 | |
| 194 | 0 | Other finance income | 194 | 0 | |
| 73 | 0 | Interest expenses | 73 | 65 | |
| 92 | 0 | Other financial expense | 92 | 1 917 | |
| 174 998 | 5 248 | Net finances | 848 040 | 4 130 | |
| -1 554 869 | - 620 077 | Profit before income tax | - 958 262 | - 623 408 | |
| - 3 839 282 | - 136 417 | Income tax expense | 8 | - 3 697 669 | - 141 540 |
| 2 284 414 | - 483 660 | Net profit or loss for the year | 5 | 2 739 408 | - 481 868 |
| To minority interests To majority interests |
2 739 408 | - 481 868 | |||
| - 2 284 414 | 483 660 | Disposal Transferred from equity |
(Amount in NOK)
| Parent | Group | ||||
|---|---|---|---|---|---|
| 2021 | 2020 | ASSETS | Note | 2021 | 2020 |
| 3 975 699 | 136 417 | Deferred tax asset | 9 | 3 840 756 | 143 087 |
| 3 975 699 | 136 417 | Total intangible assets | 3 840 756 | 143 087 | |
| 1 283 954 | 1 312 237 | Land, buildings and other property | 20 508 663 | 1 312 237 | |
| 0 | 0 | Ships | 865 167 | 0 | |
| 16 122 | 0 | Fixtures/fittings, tools, office machinery and equipment | 0 | ||
| 1 300 076 | 1 312 237 | Total tangible assets | 1 | 21 389 952 | 1 312 237 |
| 192 100 000 | 65 100 000 | Investments in subsidiaries | 2 | 0 | 0 |
| 192 100 000 | 65 100 000 | Total financial fixed assets | 0 | 0 | |
| 197 375 775 | 66 548 654 | TOTAL FIXED ASSETS | 25 230 708 | 1 455 324 | |
| 1 753 339 | 0 | Trade receivables | 3 | 0 | 0 |
| 102 420 | 65 677 | Other receivables | 3 | 6 781 507 | 35 897 |
| 1 855 759 | 65 677 | Total receivables | 6 781 507 | 35 897 | |
| 76 471 002 | 467 111 | Cash and bank deposits | 4 | 258 703 997 | 65 566 375 |
| 78 326 761 | 532 788 | TOTAL CURRENT ASSETS | 265 485 504 | 65 602 272 | |
| 275 702 535 | 67 081 442 | TOTAL ASSETS | 290 716 212 | 67 057 596 |
(Amount in NOK)
| Parent | Group | ||||
|---|---|---|---|---|---|
| 2021 | 2020 | EQUITY AND LIABILITIES | Note | 2021 | 2020 |
| 105 556 037 | 192 400 | Share capital | 6 | 105 556 037 | 192 400 |
| 165 734 431 | 0 | Share premium | 165 734 431 | 0 | |
| 0 | 65 000 000 | Non‐registered equity | 0 | 65 000 000 | |
| 113 935 | 113 935 | Other paid in equity | 113 935 | 90 089 | |
| 271 404 403 | 65 306 335 | Total paid in equity | 5 | 271 404 403 | 65 282 489 |
| 2 284 414 | 0 | Other equity | 2 715 562 | 0 | |
| 2 284 414 | 0 | Total retained earnings | 5 | 2 715 562 | 0 |
| Minority interests | 0 | 0 | |||
| 273 688 817 | 65 306 335 | TOTAL EQUITY | 5 | 274 119 965 | 65 282 489 |
| 0 | 1 705 318 | Other non current liabilities | 3 | 0 | 1 705 318 |
| 0 | 1 705 318 | Total other non current liabilities | 0 | 1 705 318 | |
| 1 424 082 | 10 272 | Trade creditors | 3 | 15 932 235 | 10 272 |
| 280 343 | 16 997 | Public duties payable | 280 343 | 16 997 | |
| 309 293 | 42 520 | Other short‐term liabilities | 383 667 | 42 520 | |
| 2 013 717 | 69 789 | Total current liabilities | 16 596 246 | 69 789 | |
| 2 013 717 | 1 775 107 | TOTAL LIABILITIES | 16 596 246 | 1 775 107 | |
| 275 702 535 | 67 081 442 | TOTAL EQUITY AND LIABILITIES | 290 716 212 | 67 057 596 |
Bodø 23 March 2022
Eirik Sørgård Chairman of the Board
Helge E. W. Albertsen CEO
Kristin Ingebrigtsen Board member
Liv Monica Stubholt Board member
Kjell Lorentsen Board member
(Amount in NOK)
| Parent | Group | |||
|---|---|---|---|---|
| 2021 | 2020 | 2021 | 2020 | |
| Cash flow from operations | ||||
| - 1 554 869 | - 620 077 | Profit before income taxes | - 958 462 | - 623 408 |
| 2 015 | 0 | Depreciation | 31 848 | 0 |
| 28 285 | 0 | Deduction of recurring VAT settlement | 28 285 | 0 |
| - 1 753 339 | 0 | Change in trade debtors | 0 | 0 |
| 1 413 810 | 10 272 | Change in trade creditors | 1 517 531 | 10 272 |
| 493 176 | 19 408 | Change in other provisions | - 2 463 072 | - 543 |
| - 1 370 922 | - 590 397 | Net cash flow from operations | - 1 843 870 | - 613 679 |
| Cash flow from investments | ||||
| - 18 137 | - 82 900 | Purchase of fixed assets | - 5 733 414 | - 82 900 |
| 0 | 0 | Repayment of short term loans | - 3 678 044 | 0 |
| 0 | 0 | Sale of subsidiary, retirement of bank deposit | 0 | - 364 949 |
| - 127 000 000 | 0 | Capital contribution in subsidiaries | 0 | 0 |
| - 127 018 137 | - 82 900 | Net cash flow from investments | - 9 411 458 | - 447 849 |
| Cash flow from financing | ||||
| 0 | 25 000 | Purchase of fixed assets | 0 | 49 210 |
| - 1 705 318 | 0 | Repayment of long term loans | - 1 705 318 | 0 |
| 222 000 004 | 0 | Proceeds from issuance of equity | 222 000 004 | 64 999 800 |
| - 15 901 736 | 0 | Issuance costs recognized directly in equity | - 15 901 736 | 0 |
| 204 392 950 | 25 000 | Net cash flow from financing | 204 392 950 | 65 049 010 |
| 76 003 891 | - 648 297 | Net change in cash and cash equivalents | 193 137 622 | 63 987 482 |
| 467 111 | 1 115 408 | Cash and cash equivalents at the beginning of the period |
65 566 375 | 1 578 893 |
| 76 471 002 | 467 111 | Cash and cash equivalents at the end of the period | 258 703 997 | 65 566 375 |
| 76 471 002 | 467 111 | Which exists of: Cash and bank deposits |
258 703 997 | 65 566 375 |
The annual accounts have been prepared in compliance with the Accounting Act and accounting principles generally accepted in Norway.
The preparation of financial statements in compliance with the Accounting Act requires the use of estimates. The application of the company's accounting principles also require management to apply assessments. Areas which to a great extent contain such assessments, a high degree of complexity, or areas in which assumptions and estimates are significant for the financial statements, are described in the notes.
Subsidiaries are companies where the parent has control, and thus controlling influence on the financial and operational strategy of the entity. In normal, controlling influence is aquired by owning more than half of the voting capital.
| Parent and subsidiaries | Ownership |
|---|---|
| Gigante Salmon AS | |
| Gigante Salmon Rødøy AS | 100 % |
The cost method is applied to investments in subsidiaries. The cost price is increased when funds are added through capital increases or when group contributions are made to subsidiaries. Dividends received are initially taken to income. Dividends exceeding the portion of retained equity after the purchase are reflected as a reduction in purchase cost. Dividend/group contribution from subsidiaries are reflected in the same year as the subsidiary makes a provision for the amount. Dividend from other companies are reflected as financial income when it has been approved.
Subsidiaries are consolidated from the point where controlling influence is transferred to the Group (point of purchase). In the the consolidated financial statements, the financial statement line 'investments in subsidiaries' are replaced by the assets and debt of the subsidiary. The consolidated financial statement is presented as if the Group was one economic entity. Transactions, unrealized gains and intercompany balances are eliminated.
Aquired subsidiaries are accounted in the consolidated financial statements based on the aquisition cost of the Parent. Acquisition cost is allocated to identifiable assets and liabilities in the subsidiary, which is accounted for in the consolidated financial statements at fair value at the time of acquisition. Any excess value in addition to what can be attributed to identifiable assets and liabilities is recognized in the balance sheet as goodwill. Goodwill is treated as a residual and recognized in the balance sheet with the share observed in the acquisition transaction. Excess values in the consolidated financial statements are amortized over the expected useful lives of the acquired assets.
Assets intended for long term ownership or use have been classified as fixed assets. Assets relating to the trading cycle have been classified as current assets. Other receivables are classified as current assets if they are to be repaid within one year after the transaction date. Similar criteria apply to liabilities. First year's instalment on long term liabilities and long term receivables are, however, not classified as short term liabilities and current assets.
Assets intended for long term ownership or use have been classified as fixed assets. Assets relating to the trading cycle have been classified as current assets. Other receivables are classified as current assets if they are to be repaid within one year after the transaction date. Similar criteria apply to liabilities. First year's instalment on long term liabilities and long term receivables are, however, not classified as short term liabilities and current assets.
Land is not depreciated. Other fixed assets are reflected in the balance sheet and depreciated to residual value over the asset's expected useful life on a straight‐line basis. If changes in the depreciation plan occur the effect is distributed over the remaining depreciation period. Direct maintenance of an asset is expensed under operating expenses
are added to the asset's cost price and depreciated together with the asset. The split between maintenance and additions/improvements is calculated in proportion to the asset's condition at the acquisition date.
Except for short term investments in listed shares, the cost method is applied to investments in other companies. The cost price is increased when funds are added through capital increases or when group contributions are made to subsidiaries. Dividends received are initially taken to income. Dividends exceeding the portion of retained equity after the purchase are reflected as a reduction in purchase cost. Dividend/group contribution from subsidiaries are reflected in the same year as the subsidiary makes a provision for the amount. Dividend from other companies are reflected as financial income when it has been approved.
Impairment tests are carried out if there is indication that the carrying amount of an asset exceeds the estimated recoverable amount. The test is performed on the lowest level of fixed assets at which independent cashflows can be identified. If the carrying amount is higher than both the fair value less cost to sell and value in use (net present value of future use/ownership), the asset is written down to the highest of fair value less cost to sell and the value in use.
Previous impairment charges, except writedown of goodwill, are reversed in later periods if the conditions causing the write‐down are no longer present.
Trade debtors are recognised in the balance sheet after provision for bad debts. The bad debts provision is made on basis of an individual assessment of each debtor and an additional provision is made for other debtors to cover expected losses. Significant financial problems at the customers, the likelihood that the customer will become bankrupt or experience financial restructuring and postponements and insufficient payments, are considered indicators that the debtors should be written down.
Other debtors, both current and long term, are recognised at the lower of nominal and net realisable value. Net realisable value is the present value of estimated future payments. When the effect of a writedown is insignificant for accounting purposes this is, however, not carried out. Provisions for bad debts are valued the same way as for trade debtors.
Liabilities, with the exception of certain liability provisions, are recognised in the balance sheet at nominal amount.
The pension schemes are financed through payments to insurance companies.
With a defined contribution plan the company pays contributions to an insurance company. After the contribution has been made the company has no further commitment to pay. The contribution is recognised as payroll expenses. Prepaid contributions are reflected as an asset (pension fund) to the degree the contribution can be refunded or will reduce future payments.
The tax charge in the income statement includes both payable taxes for the period and changes in deferred tax. Deferred tax is calculated at relevant tax rates on the basis of the temporary differences which exist between accounting and tax values, and any carryforward losses for tax purposes at the year‐end. Tax enhancing or tax reducing temporary differences, which are reversed or may be reversed in the same period, have been eliminated. The disclosure of deferred tax benefits on net tax reducing differences which have not been eliminated, and carryforward losses, is based on estimated future earnings. Deferred tax and tax benefits which may be shown in the balance sheet are presented net.
Tax reduction on group contributions given and tax on group contribution received, booked as a reduction of cost price or taken directly to equity, are booked directly against tax in the balance sheet (offset against payable taxes if the group contribution has affected payable taxes, and offset against deferred taxes if the group contribution has affected deferred taxes).
Deferred tax is reflected at nominal value.
The cash flow statement has been prepared according to the indirect method. Cash and cash equivalents include cash, bank deposits, and other short term investments which immediately and with minimal exchange risk can be converted into known cash amounts, with due date less than three months from purchase date.
The Parent owns two islands that are not depreciated.
There has not been a change in plan of depreciation.
The Group owns two islands that are not depreciated.
*The Group has capitalized own work with NOK 1 902 416.
There has not been a change in plan of depreciation.
| Buildings and land | Machines | Movables | Total fixed assets | |
|---|---|---|---|---|
| Purchase cost pr. 01.01. | 1 312 237 | 0 | 0 | 1 312 237 |
| Additions* | 19 224 709 | 895 000 | 18 137 | 20 137 846 |
| Disposals | 0 | 0 | 0 | 0 |
| Deduction of recurring VAT settlement | -28 283 | 0 | 0 | -28 283 |
| Purchase cost 31.12. | 20 508 663 | 895 000 | 18 137 | 21 421 800 |
| Accumulated depreciation 31.12. | 0 | 29 833 | 2 015 | 31 848 |
| Net book value 31.12. | 20 508 663 | 865 167 | 16 122 | 21 389 952 |
| Depreciation in the year | 0 | 29 833 | 2 015 | 31 848 |
| Buildings and land | Movables | Total fixed assets | |
|---|---|---|---|
| Purchase cost pr. 01.01. | 1 312 237 | 0 | 1 312 237 |
| Additions | 0 | 18 137 | 18 137 |
| Disposals | 0 | 0 | 0 |
| Deduction of recurring VAT settlement | -28 283 | 0 | 0 |
| Purchase cost 31.12. | 1 283 954 | 18 137 | 1 302 091 |
| Accumulated depreciation 31.12. | 0 | 2 015 | 2 015 |
| Net book value 31.12. | 1 283 954 | 16 122 | 1 300 076 |
| Depreciation in the year | 2 015 | 0 | 2 015 |
Investments in subsidiaries are booked according to the cost method.
| Parent | ||||
|---|---|---|---|---|
| Other receivables | Other non-current liabilities | |||
| 2021 | 2020 | 2021 | 2020 | |
| Group companies | 0 | 29 780 | 0 | 0 |
| Parent company | 0 | 0 | 0 | 1 705 318 |
| Total | 0 | 29 780 | 0 | 1 705 318 |
| Trade receivables | Trade creditors | |||
|---|---|---|---|---|
| 2021 | 2020 | 2021 | 2020 | |
| Group companies | 1 753 339 | 0 | 0 | 0 |
| Total | 1 753 339 | 0 | 0 | 0 |
| Trade receivables | Other non‐current liabilities | |||
|---|---|---|---|---|
| 2021 | 2020 | 2021 | 2020 | |
| Parent company | 0 | 0 | 0 | 1 705 318 |
| Total | 0 | 0 | 0 | 1 705 318 |
| Subsidiary | Location | Ownership/ voting right |
Equity last year (100%) |
Result last year (100%) |
Balance sheet value |
|---|---|---|---|---|---|
| Gigante Salmon Rødøy AS | Bodø | 100 % | 192 531 147 | 454 794 | 192 100 000 |
| Balance sheet value 31.12. | 192 100 000 |
| Parent | Group | |||
|---|---|---|---|---|
| 2021 | 2020 | Restricted bank deposits | 2021 | 2020 |
| 172 194 | 24 939 | Withheld employee taxes | 172 194 | 24 939 |
| Overdraft facilities granted | ||||
| 0 | 0 | Unused bank overdraft | 0 | 0 |
| Parent | |||||
|---|---|---|---|---|---|
| Equity changes in the year | Share capital | Share premium |
Other paid-in equity | Other equity | Non-registered capital increase |
| Equity 01.01. | 192 400 | 0 | 113 935 | 0 | 65 000 000 |
| Profit for the year | 0 | 0 | 0 | 2 284 414 | 0 |
| Capital increase, registered | 65 000 000 | 0 | 0 | 0 | -65 000 000 |
| Issuance of equity | 40 363 637 | 181 636 367 | 0 | 0 | 0 |
| Transaction costs* | 0 | -15 901 936 | 0 | 0 | 0 |
| Equity 31.12. | 105 556 037 | 165 734 431 | 113 935 | 2 284 414 | 0 |
| Equity changes in the year | Total |
|---|---|
| Equity 01.01. | 65 306 335 |
| Profit for the year | 2 284 414 |
| Capital increase, registered | 0 |
| Issuance of equity | 222 000 004 |
| Transaction costs* | -15 901 936 |
| Equity 31.12. | 273 688 817 |
*Transaction costs in conjunction with the issuance of new equity.
| Group | |||||
|---|---|---|---|---|---|
| Equity changes in the year | Share capital | Share premium |
Other paid-in equity | Other equity | Non-registered capital increase |
| Equity 01.01. | 192 400 | 0 | 90 089 | 0 | 65 000 000 |
| Profit for the year | 0 | 0 | 23 846 | 2 715 562 | 0 |
| Capital increase, registered | 65 000 000 | 0 | 0 | 0 | -65 000 000 |
| Issuance of equity | 40 363 637 | 181 636 367 | 0 | 0 | 0 |
| Transaction costs* | 0 | -15 901 936 | 0 | 0 | 0 |
| Equity 31.12. | 105 556 037 | 165 734 431 | 113 935 | 2 715 562 | 0 |
| 65 282 489 |
|---|
| 2 739 408 |
| 0 |
| 222 000 004 |
| -15 901 936 |
| 274 119 965 |
The share capital of NOK 105 556 037 consists of 105 556 037 shares with nominal value of NOK 1 each.
| Shareholder | Number of shares | Ownership | |
|---|---|---|---|
| Gigante Havbruk AS | 64 238 000 | 60,86 % | |
| T Kolstad Eiendom AS | 7 272 728 | 6,89 % | |
| J.p. Morgan Bank Luxembourg S.a. | 3 272 726 | 3,10 % | |
| Helgeland Invest AS | 2 727 272 | 2,58 % | |
| Torghatten Aqua AS | 2 727 272 | 2,58 % | |
| Verdipapirfondet Nordea Avkastning | 2 181 819 | 2,07 % | |
| Sparebank 1 Markets AS | 1 843 986 | 1,75 % | |
| Ravi Investering AS | 1 500 000 | 1,42 % | |
| Iha Invest AS | 1 455 000 | 1,38 % | |
| Hi Capital AS | 1 363 636 | 1,29 % | |
| Verdipapirfondet First Generator | 1 177 464 | 1,12 % | |
| Commuter 2 AS | 1 090 909 | 1,03 % | |
| Olav Olsen Holding AS | 1 000 000 | 0,95 % | |
| Limt AS | 910 000 | 0,86 % | |
| Dnor AS | 909 093 | 0,86 % | |
| Nyhamn AS | 909 091 | 0,86 % | |
| Aino Aktiv AS | 545 455 | 0,52 % | |
| Maria Olaisen AS | 545 455 | 0,52 % | |
| Hausta Vekst AS | 545 454 | 0,52 % | |
| Occasione By Olaisen AS | 545 454 | 0,52 % | |
| Other owners | 8 795 223 | 8,33 % | |
| Total | 105 556 037 | 100,0 % |
| Name | Position | Number of shares | Ownership |
|---|---|---|---|
| Eirik Sørgård | Chairman of the Board | 200 000 | 0,19 % |
| Helge E. W. Albertsen | CEO | 200 000 | 0,19 % |
| Rune Johansen | CFO | 235 000 | 0,22 % |
Kjell Lorentsen has controlling influence through Gigante Havbruk AS who owns 64 238 000 shares (ownership 60,86 %).
The company's pension schemes meet the requirements of the law on compulsory occupational pension.
| Parent | Group | |||
|---|---|---|---|---|
| 2021 | 2020 | Temporary differences | 2021 | 2020 |
| 3 426 | 0 | Net temporary differences | 3 271 062 | 0 |
| -18 074 785 | -620 077 | Tax losses carried forward | -20 729 041 | -650 393 |
| -18 071 359 | -620 077 | Basis for deferred tax asset | -17 457 979 | -650 393 |
| -3 975 699 | -136 417 | Deferred tax asset | -3 840 756 | -143 086 |
| -3 975 699 | -136 417 | Deferred tax asset in the balance sheet | -3 840 756 | -143 086 |
| Basis for income tax expense | ||||
|---|---|---|---|---|
| -1 554 868 | -620 077 | Result before taxes | -958 462 | -643 359 |
| -15 896 415 | 0 | Permanent differences* | -15 849 126 | 0 |
| -17 451 283 | -620 077 | Basis for the tax expense for the year | -16 807 588 | -643 359 |
| -3 426 | 0 | Change in temporary differences | -3 271 062 | 0 |
| -17 454 709 | -620 077 | Basis for payable taxes in the income statement | -20 078 650 | -643 359 |
| -17 454 710 | -620 077 | Taxable income (basis for payable taxes in the balance sheet) |
-20 078 650 | -643 359 |
* Permanent differences are due to transaction costs that has been booked directly to equity, please see note 5.
Continues on the next page >>
| Parent | Group | |||
|---|---|---|---|---|
| 2021 | 2020 | Basis for income tax expense, changes in deferred tax and tax payable |
2021 | 2020 |
| 0 | 0 | Tax payable | 0 | 0 |
| 0 | 0 | Total tax payable | 0 | 0 |
| -3 839 282 | -136 417 | Change in deferred tax asset | -3 697 670 | -141 540 |
| -3 839 282 | -136 417 | Tax expense | -3 697 670 | -141 540 |
| -1 554 868 | -620 077 | Result before taxes | -958 462 | -643 359 |
|---|---|---|---|---|
| -342 071 | -136 417 | Calculated tax | -210 862 | -141 540 |
| -3 839 282 | -136 417 | Tax expense | -3 697 670 | -141 540 |
| -3 497 211 | -0 | Difference | -3 486 808 | 0 |
| -3 497 211 | 0 | Tax of permanent differences | -3 486 808 | 0 |
|---|---|---|---|---|
| -3 497 211 | 0 | Sum explained differences | -3 486 808 | 0 |
| Parent | Group | |||
|---|---|---|---|---|
| 2021 | 2020 | Payroll expenses | 2021 | 2020 |
| 1 795 719 | 425 753 | Salaries/wages | 1 795 719 | 425 753 |
| 153 415 | 31 801 | Social security fees | 153 415 | 31 801 |
| 140 227 | 12 228 | Pension expenses | 140 227 | 12 228 |
| 24 435 | 0 | Other remuneration | 39 345 | 0 |
| 2 113 796 | 469 782 | Total | 2 128 706 | 469 782 |
| 2 | 1 | Number of employees in the accounting year | 2 | 1 |
|---|---|---|---|---|
No loans/sureties have been granted to the general manager, Board chairman or other related parties.
| Total audit fees | 159 724 | 196 296 |
|---|---|---|
| Other non audit services | 45 012 | 54 212 |
| Technical assistance with tax return | 4 100 | 8 200 |
| Technical assistance with financial statements | 48 748 | 52 848 |
| Statutory audit | 61 864 | 81 036 |
| Expensed audit fee (incl. VAT) | Parent | Group |
The Parent has been audited from 2020.
Remuneration to executives is disclosed in note 9, and balance with group companies is disclosed in note 3.
| Related-party transactions: | Parent | Group |
|---|---|---|
| a) Sales of goods and services | ||
| Sales of services/re-invoicing: | ||
| - Subsidiary | 2 290 312 | 0 |
| Parent | Group |
|---|---|
| 61864 | 81036 |
| 48748 | 52848 |
| 4100 | 8200 |
| 45012 | 54212 |
| 159724 | 196296 |
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