Earnings Release • Jul 14, 2023
Earnings Release
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Aker BioMarine ASA 14 July 2023
1) Aker BioMarine evaluates the performance based on Adjusted EBITDA. This metric is defined as operating profit before depreciation, amortization, write-downs and impairments, and special operating items. Special operating items include gains or losses on sale of assets, if material, restructuring expenses and other material transactions of either non-recurring nature or special in nature compared to ordinary operational income or expenses.
3
activities towards end of year
YoY
October
2023 season tracking on par with 2022
2) Other includes Qrill Pet, Asta and QHP
Fish oil and fish meal prices (USD, July 2009 = 1)
Commodity prices
Aker BioMarine products
24% 24%
NEW FINANCIAL REPORTING STRUCTURE
• Increased flexibility for development of AKBM Group and business segments
Group figures
Adj. EBITDA and margin USD million and %
Montevideo vs Gasoil 0.1% FOB Rotterdam Barges (USD/Mt)
| USD million | Q2 2023 | Q2 2022 | 2022 |
|---|---|---|---|
| (Unaudited) | (Unaudited) | (Audited) | |
| Net sales | 88.6 | 73.4 | 277.2 |
| Cost of goods sold |
-58.7 | -42.8 | -162.4 |
| Gross profit | 29.9 | 30.7 | 114.8 |
| SG&A | -18.9 | -21.0 | -86.5 |
| Depreciation, amortization and imp. (non-production assets) |
-4.9 | -4.2 | -16.4 |
| Other operating income | - | 9.9 | 10.2 |
| Operating profit (loss) | 6.2 | 15.3 | 22.1 |
| Net financial items | -10.2 | 0.5 | -9.9 |
| Tax expense | 1.6 | 0.8 | -2.2 |
| Net profit (loss) | -2.4 | 15.0 | 10.0 |
| EBITDA reconciliation | |||
| Net profit (loss) | -2.4 | 15.0 | 10.0 |
| Tax expense | -1.6 | 0.8 | 2.2 |
| Net financial items | 10.2 | -0.5 | 9.9 |
| Depreciation, amortization and imp. | 4.9 | 4.2 | 16.4 |
| D&A and imp. from production assets incl. in COGS | 7.9 | 8.8 | 35.0 |
EBITDA (unadjusted) 19.0 28.3 73.5 Adjustments 2.5 -6.9 -4,5 EBITDA (adjusted) 21.5 21.4 69.0
▪ Increased sale of both krill oil and krill meal. In the Ingredients segment, gross margin % is down due to low production in Houston. Qrill Aqua is sold with lower margin, due to higher fuel prices.
▪ Lower SG&A despite elevated inflation is due to effects from improvement program
▪ Intangible assets amortized according to plan. Depreciation on production related assets included in cost of goods sold.
▪ Net financial items in the quarter was USD -10.2m, down from USD 0.5m. The change is mainly due to higher debt and higher interest rate in addition to positive agio effects in Q2 22.
▪ No tax in Norwegian entities due to tax losses carried forward. Measures taken to optimize US tax payments for Lang.
| USD million | Q2 2023 | Q2 2022 | 2022 |
|---|---|---|---|
| (Unaudited) | (Unaudited) | (Audited) | |
| ASSETS | |||
| Property, plant and equipment | 329.5 | 323.1 | 333.2 |
| Right to use assets | 11.7 | 9.1 | 9.9 |
| Intangible assets and goodwill | 159.1 | 164.6 | 162.7 |
| Contract cost |
4.2 | 6.2 | 5.2 |
| Deferred tax asset | 3.2 | 2.1 | |
| Other interest-bearing non-current receivables |
2.4 | 2.5 | |
| Investments in equity-accounted investees | 10.2 | 11.3 | 10.2 |
| Total non current assets |
520.4 | 514.5 | 525.8 |
| Inventories | 188.2 | 165.9 | 182.7 |
| Trade receivable and prepaid expenses | 92.3 | 70.9 | 82.7 |
| Derivative assets | 4.1 | 21.4 | 11.0 |
| Cash and cash equivalents | 14.8 | 17.0 | 22.3 |
| Total current assets | 299.3 | 275.2 | 298.7 |
| TOTAL ASSETS | 819.7 | 789.7 | 824.5 |
| LIABILITIES AND OWNERS' EQUITY | |||
| Interest-bearing debt | 370.3 | 317.8 | 333.6 |
| Deferred tax liability | 7.3 | 5.3 | 7.5 |
| Other non-interest-bearing non-current liabilities | 0.1 | 0.2 | 0.1 |
| Total non current liabilities | 377.7 | 323.3 | 341.1 |
| Interest-bearing current liabilities | 43.0 | 48.9 | 47.6 |
| Accounts payable and other payables | 46.6 | 34.1 | 57.1 |
| Total current liabilities | 89.6 | 83.0 | 104.7 |
| TOTAL LIABILITIES | 467.3 | 406.1 | 445.8 |
| Total equity | 352.3 | 383.6 | 378.7 |
| TOTAL EQUITY AND LIABILITIES | 819.7 | 789.7 | 824.5 |
▪ Depreciation of USD 8.1m in the quarter. Additions to PPE mainly include investments into Understory (Protein plant), USV, development activities and shipyard.
▪ Customer contracts amortized according to plan. No impairments as of 30 June.
Other non-interest bearing non-current receivables:
▪ Includes USD 2.0m convertible debt to Aion as part of the funding of the circular activities
Cash and cash equivalents (including derivatives)
▪ Cash and cash equivalents (including derivatives) was USD 18,9m. Net interest bearing debt USD 398.5m, up from 358.9m at year end.
▪ Deferred tax liability due to tax timing of depreciation and amortization of goodwill in the US.
| USD million | Q2 2023 | Q2 2022 | 2022 |
|---|---|---|---|
| (Unaudited) | (Unaudited) | (Unaudited) | |
| Net profit (loss) after tax | -2.4 | 15.0 | 10.0 |
| Tax expenses | -1.6 | 0.8 | 2.2 |
| Net interest and guarantee expenses | 7.7 | -2.1 | 19.7 |
| Interest paid | -7.2 | -3.8 | -17.6 |
| Interest received | 0.3 | 0.1 | 0.3 |
| Taxes paid | -0.2 | -0.4 | -2.8 |
| Other P&L items with no cash flow effect | 0.0 | -17.5 | -10.7 |
| Depreciation and amortization | 12.7 | 12.8 | 51.4 |
| Foreign exchange loss (gain) | 0.0 | 6.1 | 0.6 |
| Change in working capital | -24.2 | -17.8 | -38.0 |
| Net cash flow from operating activities | -14.8 | -6.8 | 15.1 |
| Payments for property, plant and equipment | -6.1 | -7.7 | -40.5 |
| Payments for intangibles | -0.6 | -0.7 | -5.6 |
| New long-term receivable interest-bearing | - | - | -2.0 |
| Installment short/long-term receivable, interest-bearing | - | - | 2.8 |
| Earn Out Payment | - | 11.1 | -11.1 |
| Net cash flow from investing activities | -6.7 | -19.5 | -56.4 |
| Proceeds from issue of debt and change in overdraft facility | -19.8 | -2.7 | -5 |
| Instalment interest-bearing debt | -3.8 | -2.8 | -14.2 |
| Proceeds from issue of external interest-bearing debt | 30.0 | 29.7 | 50.0 |
| Net funds from issue of shares | 0.1 | - | 0.2 |
| Net cash flow from financing activities | 6.6 | 24.3 | 52.5 |
| Net change in cash and cash equivalents | -14.9 | -2.0 | 11.2 |
| Cash and cash equivalents beginning of the period | 29.7 | 19.1 | 11.1 |
| Cash and cash equivalents end of period | 14.8 | 17.0 | 22.3 |
| Cash flow from operations | |
|---|---|
| ▪ | Lower cash flow from operations in Q2-23 compared to Q2-22 driven by net loss. |
| ▪ | Higher working capital due to higher receivables and inventory buildup in Lang in the quarter due to planned large gummies shipment. |
| ▪ | Other P&L items in 2022 with no cash flow effect included the fair value adjustment on the Aion transaction |
| Cash flow from investing activities | |
| ▪ | In Q2-23 there have been payments on several ongoing projects, in particular the Protein project, USV, development projects and shipyard, in total USD 6.7m |
| Cash flow from financing activities | |
| ▪ | Positive cash flow from financing activities of USD 6.6m due to draw under the RCF of USD 30m. This is partly offset by change in overdraft facility of USD 19.8m. Instalments on ECA facility amounting to USD 2.4m in the quarter. |
| Operations | Qrill Aqua | Superba | Brands | ||
|---|---|---|---|---|---|
| ▪ Harvesting YTD is on track to deliver on a normalized harvesting year |
▪ Expect revenues for the third quarter to be above the same quarter last year |
▪ Expect revenues for the third quarter to be above same quarter last year |
▪ Expect revenues for the third quarter to be above same quarter last year |
||
| ▪ Limited oil production in Houston through 2023 to further adjust inventory levels |
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| Long-term annual average sales target of around 15% p.a. |
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Excluding eliminations between Ingredients and Brands
Curbing the impact on surging oil prices and creates predictability in largest cost drive
Gasoil 0.1% FOB Rotterdam Barges (USD/Mt)
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