Quarterly Report • Nov 1, 2023
Quarterly Report
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Aker BioMarine ASA 1 November 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.
2023 season tracking on par with 2022
Annual revenue, USD million
1.
2.
Premium quality – documented effects & financial value
Good momentum on price
Assumptions in this example2):
8% decrease in FCR
~10 years ago, krill producers only got paid for protein content
Lang
Group figures
| USD million | Q3 2023 | Q3 2022 | 2022 |
|---|---|---|---|
| (Unaudited) | (Unaudited) | (Audited) | |
| Net sales | 94.6 | 67.9 | 277.2 |
| Cost of goods sold |
-59.4 | -36.6 | -162.4 |
| Gross profit | 35.2 | 31.2 | 114.8 |
| SG&A | -19.1 | -20.8 | -86.5 |
| Depreciation, amortization and imp. (non-production assets) |
-5.7 | -4.2 | -16.4 |
| Other operating income |
0.1 | 0.1 | 10.2 |
| Operating profit (loss) | 10.5 | 6.4 | 22.1 |
| Net financial items | -8.2 | -1.2 | -9.9 |
| Tax expense | -1.1 | 0.6 | -2.2 |
| Net profit (loss) | 1.1 | 4.6 | 10.0 |
| EBITDA reconciliation | |||
| Net profit (loss) | 1.1 | 4.6 | 10.0 |
| Tax expense | 1.1 | 0.6 | 2.2 |
| Net financial items | 8.2 | 1.2 | 9.9 |
| Depreciation, amortization and imp. | 5.7 | 4.2 | 16.4 |
| D&A and imp. from production assets incl. in COGS | 8.0 | 8.2 | 35.0 |
| EBITDA (unadjusted) | 24.2 | 18.8 | 73.5 |
| Adjustments | 0.7 | - | -4,5 |
| EBITDA (adjusted) | 24.9 | 18.8 | 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, mainly due to higher fuel prices.
▪ Lower SG&A despite elevated inflation and higher sales due to effects from improvement program.
▪ Intangible assets amortized according to plan. Depreciation on production related assets included in cost of goods sold except for Ski plant (USD 1.1m).
▪ Net financial items in the quarter was USD -8.2m, down from USD -1.2m. The change is due to higher debt and interest rate. Share of loss from Aion aggregated from June'22 included as financial expense, partly offset by gain on Acasti transaction. Q3'22 was impacted by currency gain.
▪ No tax in Norwegian entities due to tax losses carried forward.
| USD million | Q3 2023 | Q3 2022 | 2022 |
|---|---|---|---|
| (Unaudited) | (Unaudited) | (Audited) | |
| ASSETS | |||
| Property, plant and equipment | 327.8 | 325.1 | 333.2 |
| Right to use assets | 9.9 | 10.7 | 9.9 |
| Intangible assets and goodwill | 158.5 | 162.6 | 162.7 |
| Contract cost | 4.2 | 5.7 | 5.2 |
| Deferred tax asset | 3.4 | 2.1 | |
| Other interest-bearing non-current receivables |
2.4 | 2.6 | 2.5 |
| Investments in equity-accounted investees | 8.6 | 11.3 | 10.2 |
| Total non current assets | 514.7 | 518.0 | 525.8 |
| Inventories | 183.2 | 180.5 | 182.7 |
| Trade receivable and prepaid expenses | 91.3 | 71.5 | 82.7 |
| Derivative assets | 7.3 | 13.1 | 11.0 |
| Cash and cash equivalents | 18.7 | 13.5 | 22.3 |
| Total current assets | 300.5 | 278.5 | 298.7 |
| TOTAL ASSETS | 815.3 | 796.6 | 824.5 |
| LIABILITIES AND OWNERS' EQUITY | |||
| Interest-bearing debt | 346.9 | 316.4 | 333.6 |
| Deferred tax liability | 7.6 | 5.5 | 7.5 |
| Other non-interest-bearing non-current liabilities | 0.1 | 0.1 | 0.1 |
| Total non current liabilities | 354.7 | 322.0 | 341.1 |
| Interest-bearing current liabilities | 59.7 | 57.2 | 47.6 |
| Accounts payable and other payables | 44.0 | 36.9 | 57.1 |
| Total current liabilities | 103.7 | 94.0 | 104.7 |
| TOTAL LIABILITIES | 458.4 | 416.0 | 445.8 |
| Total equity | 357.0 | 380.5 | 378.7 |
| TOTAL EQUITY AND LIABILITIES | 815.3 | 796.6 | 824.5 |
▪ Depreciation of USD 9.1m in the quarter. Additions to PPE mainly include investments into Understory (Protein), development activities, shipyard and production equipment from the Acasti transaction.
▪ Amortizations of USD 3.5m in the quarter. No impairments as of 30 September.
▪ Include USD 2.0m convertible debt to Aion as part of the funding of the circular activities
▪ Cash and cash equivalents was USD 18.7m. Net interest bearing debt USD 387.9m, up from 358.9m at year end, but down from Q2 2023 at USD 399m.
▪ Deferred tax liability due to tax timing of depreciation and amortization of goodwill in the US.
▪ 44 %
| USD million | Q3 2023 | Q3 2022 | 2022 |
|---|---|---|---|
| (Unaudited) (Unaudited) | (Audited) | ||
| Net profit (loss) after tax | 1.1 | 4.6 | 10.0 |
| Tax expenses | 1.1 | 0.6 | 2.2 |
| Net interest and guarantee expenses | 8.2 | -0.4 | 19.7 |
| Interest paid | -8.6 | -3.1 | -17.6 |
| Interest received | 0.8 | 0.1 | 0.3 |
| Taxes paid | -1.2 | -0.4 | -2.8 |
| Share of profit in associated companies | 1.6 | - | - |
| Other P&L items with no cash flow effect | - | - | -10.7 |
| Depreciation and amortization | 13.7 | 12.7 | 51.4 |
| Foreign exchange loss (gain) | -0.2 | 2.1 | 0.6 |
| Change in working capital | 3.8 | -15.7 | -38.0 |
| Net cash flow from operating activities | 20.3 | 0.4 | 15.1 |
| Payments for property, plant and equipment | -7.5 | -10.6 | -40.5 |
| Payments for intangibles | -2.4 | - | -5.6 |
| New long-term receivable interest-bearing | - | - | -2.0 |
| Installment short/long-term receivable, interest-bearing | -0.2 | - | 2.8 |
| Earn Out Payment | - | - | -11.1 |
| Net cash flow from investing activities | -10.0 | -10.6 | -56.4 |
| Proceeds from issue of debt and change in overdraft facility | -2.8 | 7.4 | 16.5 |
| Instalment interest-bearing debt | -3.6 | -0.6 | -14.2 |
| Proceeds from issue of external interest-bearing debt | - | - | 50.0 |
| Net funds from issue of shares | - | -0.2 | 0.2 |
| Net cash flow from financing activities | -6.4 | 6.7 | 52.5 |
| Net change in cash and cash equivalents | 3.9 | -3.6 | 11.2 |
| Cash and cash equivalents beginning of the period | 14.8 | 17.0 | 11.1 |
| Cash and cash equivalents end of period | 18.7 | 13.5 | 22.3 |
| ▪ | Higher cash flow from operations in Q3-23 compared to Q3-22 driven by |
|---|---|
| net change in working capital. Lower net profit in the period due to | |
| higher depreciations and financial expenses. |
▪ In Q3-23 there has been payments on several ongoing projects, in particular the Protein project, development projects and shipyard, in total USD 7.5m
▪ Negative cash flow from financing activities of USD 6.4m due to instalment (incl lease) and change in overdraft facility. 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 fourth quarter to be on par with the same quarter last year |
▪ Expect revenues for the fourth quarter to be above same quarter last year |
▪ Expect revenues for the fourth quarter to be above same quarter last year |
| Houston will continue ▪ to ramp up production, expected to be in normal production in 2024 |
Long-term annual average sales target of around 15% p.a.
Excluding eliminations between Ingredients and Brands
Krill oil Qrill Aqua Brands Other Qrill category*
Curbing the impact on surging oil prices and creates predictability in largest cost drive
Gasoil 0.1% FOB Rotterdam Barges (USD/Mt)
Montevideo vs Gasoil 0.1% FOB Rotterdam Barges (USD/Mt)
The leading krill harvester and producer of krill meal
2) Direct business unit SG&A costs, not including Corporate costs such as HR, IT, Finance dep., non-dedicated EMT
2) Direct business unit SG&A costs, not including Corporate costs such as HR, IT, Finance dep., non-dedicated EMT 3) Net Nutra costs = net raw material costs of Nutra meal at USD 3,500/Mt after deducting revenues received for QHP
27
Lang Pharma Nutrition – our private label offering in the US
20 year relationships with major tier-1 Mass retailers
1) Estimates based on historical data and company plans, not subjected to audit
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