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Aker BioMarine
Remuneration Information • Mar 20, 2024
3527_rns_2024-03-20_a5c829a5-4602-402e-b72e-732c51efdd07.pdf
Remuneration Information
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2023 Management remuneration report
MANAGEMENT REMUNERATION REPORT 2021
Remuneration Report 2023
This remuneration report ("Remuneration Report") provides the overview of the total remuneration received by the Board of Directors (the Board) and the Executive Management of Aker BioMarine ASA, Org. no. 913 915 062 (the "Company"), during the financial year 2023, with comparative figures for the past five years. Executive Management refers in this Remuneration Report to members of the Executive Management of the Company as well as the CEO of Lang Pharma Nutrition Inc. (Lang), the wholly-owned US subsidiary of Aker BioMarine ASA operating within the Brands segment.
The main purpose of the Remuneration Policy1 is to encourage a strong and sustainable performance-based culture, which also supports growth in shareholder value. The remuneration of the executives shall promote the achievement of good financial results and management in accordance with the company's values and business ethics and shall reflect the content and complexity of the managers' position, as well as the individual performance. It is also considered important to provide competitive terms that help to retain key personnel and executive management and in turn mitigate the risk that core qualification and experience is lost by key people leaving the company. The policy allows for differentiation; opening up for tailoring remuneration packages for key positions in order to promote strategic goals and sustainable, long-term value creation. Within the frames of the policy, the remuneration may include fixed remuneration, shortterm incentives, and long-term incentives.
The Remuneration Report has been prepared in accordance with §§6-16 a and 6-16 b of the Public Limited Liability Companies Act and the European Commission Guidelines on the standardized presentation of the remuneration report under Directive 2007/36/EC, as amended by Directive (EU) 2017/828. The information included in the Remuneration Report has partly been derived from the audited annual reports of Aker BioMarine for the financial years 2018-2022 2 with additional information to support the explanation of the remuneration of the Board and Executive Management. All amounts are included in USD, gross.
1 Introduction
For the year 2023, Adjusted Group Earnings before Interest, Tax, Depreciation, Amortization and special operating items ("Adjusted EBITDA") was USD 70.0 million in 2023, compared to USD 69.0 million in 2022. For the Ingredients segment, 2023 yielded good revenue growth of our main product categories, Qrill (+22%) and Superba krill oil (+36%) compared to 2022 – the highest organic growth in Aker BioMarine's history. For the Brands segment, the revenue growth was 9% compared to the previous year.
In 2023, Aker BioMarine elected two new employee representatives to the Board replacing the existing employee elected board members. Executive Management stayed consistent, with the exception of the EVP Innovation.
The general meeting endorsed the Board of Directors' 2022 remuneration report for leading personnel in AkerBioMarine with no remarks.
1 Remuneration Policy can be found on our webpage: www.akerbiomarine.com
2 Board of Directors
2.1 FIXED REMUNERATION
The Board and the Nomination Committee considers the remuneration of the Board and its committees as matching the remuneration levels in comparable companies, considering, among others, the board members' required competencies, efforts, and the scope of the board work. Members of the Board receive a fixed annual fee approved by the Annual General Meeting. Board members who are also members of one of the board committees receive an annual committee remuneration. The fees for the chairman of the board and the chairman of the audit committee are somewhat higher than the fees for ordinary members, reflecting their extended duties. The employee elected members of the Board do not receive separate compensation for their directorships. Members of the Board are not eligible for performance shares, variable remuneration or pension contribution.
Individual board members may take on specific ad hoc tasks outside the scope of duties assigned by the Board and may be entitled to additional fees for such tasks on the conditions set out in the Remuneration Policy. For the financial year 2023, none of the board members have received additional remuneration for carrying out ad hoc duties assigned by the Board. Additional compensation may be offered for board members taking up board responsibilities on behalf of the Company in joint ventures and/or subsidiaries. For the financial year 2023, none of the board members have received additional compensation for taking up responsibilities in joint ventures or subsidiaries.
Remuneration to the Board of Directors 2023 (USD)
| Name | Position | Remuneration Board of Directors | Remuneration Audit Committee | ||
|---|---|---|---|---|---|
| Ola Snøve | Chairman of the Board / member Audit Committee | 59,633 | 10,412 | ||
| Kjell Inge Røkke 1) | Deputy member Board of Directors |
0 | |||
| Anne Harris | Board Director/Chairman Audit Committee | 30,763 | 17,984 | ||
| Cilia Holmes Indahl | Board Director | 30,763 | |||
| Kristin Holmgren (as of June 2023) |
Employee elected Board Director | ||||
| Thomas Røkke (as of June 2023) |
Employee elected Board Director | ||||
| Kimberly Mathisen | Board Director | 30,763 2 |
|||
| Frank Reite | Board Director and Audit Committee | 30,763 | 10,412 | ||
| Total | 182,685 | 38,808 |
1) Senior executives are not personally permitted to receive directors' fees from other companies within Aker. The directors' fees are in such cases paid directly to the company of which the relevant director is an employee. Consequently, the fee applicable to Kjell Inge Røkke will be paid to The Resource Group TRG AS.
3 Executive Management
The Executive Management received an annual remuneration in accordance with the Remuneration Policy, which may consist of the following fixed and variable remuneration components:
- Fixed remuneration (annual fixed base salary)
- Benefits
- Cash bonus (short-term and long-term incentives)
- Other forms of special remuneration provided for in the Remuneration Policy
These remuneration elements create a well-balanced package reflecting (i) individual performance and responsibility of the Executive Management in relation to established goals and targets, both in the short and the long term, and (ii) Aker BioMarine's overall performance.
For 2023, the Executive Management's short-term incentive program is linked to the Company's performance on a pre-defined target adjusted EBITDA. The composition of the remuneration of each executive is determined with a view to contributing to the Company's ability to attract, motivate, and retain competent key employees, while at the same time ensuring that the Executive Management has an incentive to create added value aligned to the interest of the Company's shareholders through variable remuneration.
The CEO's terms of employment and remuneration are agreed between the CEO and the Board, and likewise the rest of the Executive Management between the individual executive and the CEO. The Executive Management does not receive additional remuneration for directorships (whether executive positions or board memberships) in Aker BioMarine's subsidiaries.
3.1 ANNUAL FIXED SALARY
The annual fixed salary is set to provide a competitive remuneration to attract and retain competent members of the Executive Management, having the required professional and personal competences and enabling Aker BioMarine to obtain its short- and long-term goals.
In 2023, the fixed salary for the Executive Management is in line with the Remuneration Policy.
| 2023 | 1 Fixed remuneration | 2 Variable remuneration | 3 Extraordinary |
4 Pension | 5 Total | 6 Proportion of fixed and | ||||
|---|---|---|---|---|---|---|---|---|---|---|
| Name of Director, position | Base salary | Fees Fringe benefits |
One-year variable |
Multi-year variable |
items | expense | Remuneration | variable remuneration | ||
| Matts Johansen, CEO | 420 073 | 953 | 259 580 | 8 207 | 688 813 | 62% | 38% | |||
| Katrine Klaveness, CFO | 280 692 | 953 | 88 441 | 8 207 | 378 293 | 77% | 23% | |||
| Hege Spaun, Chief Officer People & External Affairs | 161 346 | 953 | 50 735 | 8 207 | 221 241 | 77% | 23% | |||
| Tone Lorentzen, EVP Supply Chain | 239 878 | 953 | 75 338 | 8 207 | 324 376 | 77% | 23% | |||
| Webjørn Barstad, EVP Offshore Supply Chain | 267 471 | 1 073 | 238 531 | 8 031 | 515 106 | 54% | 46% | |||
| Sigve Nordrum, EVP Animal Health & Nutrition | 195 006 | 953 | 61 253 | 47 275 | 304 487 | 80% | 20% | |||
| Simon Seward, EVP Human Healt & Nutrition | 224 269 | 1 073 | 72 932 | 8 031 | 306 305 | 76% | 24% | |||
| Shauna McNeil, EVP Innovation (until 31.01.2023) | 14 593 | 80 | 58 662 | 612 | 73 947 |
21% | 79% | |||
| Trond Atle Smedsrud, EVP Strategic Investments | 210 256 | 953 | 65 511 | 8 207 | 284 927 | 77% | 23% | |||
| Seth French, CEO Lang Pharma Nutrition Inc. | 500 000 | 30 455 | 291 667 | 12 815 | 834 937 | 65% | 35% |
MANAGEMENT REMUNERATION REPORT 2023
3.2 OTHER BENEFITS
Members of the Executive Management have received customary work-related non-monetary employment benefits such as insurance, newspaper, telephone and internet access.
In 2023 the Company invited employees to participate in an employee share purchase program. The program offers employees on active payroll in the Norwegian Group Companies (including members of the executive management team) to purchase ordinary shares in the Company at a reduced offer price. The main purpose of the program is to align the interest between the shareholders and the Aker BioMarine employee and encourage participation in the long-term value creation of Aker BioMarine.
3.3 PENSION SCHEME
Members of the Executive Management are covered by Aker BioMarine's employer administered pension, in line with the Remuneration Policy. One member of the Executive Management, EVP Animal Health & Nutrition Sigve Nordrum, has been covered by a separate pension scheme administered by Aker ASA (Aker Pensjonskasse), an agreement dating back to the hire date in 2007. At the end of 2023, the defined benefit plan was terminated and Sigve Nordrum was moved to the defined contribution plan.
3.4 CASH BONUS
Members of the Executive Management participate in an annual cash bonus based on the adjusted EBITDA of the financial year. The bonus is intended to ensure the attainment of Aker BioMarine's short-term objectives following the principles in the Remuneration Policy. Payment is done after the approval of the annual financial statements for the relevant financial year. There are no qualitative measurements for a cash bonus.
The bonus pay-out level is based on the achievement of the adjusted EBITDA target and is capped at 100/ 50 % of the annual fixed salary for the CEO/ rest of Executive Management, respectively. The annual cash bonus for the CEO of Lang is linked to the performance of Lang and not to the EBITDA target for the Aker BioMarine Group.
In 2023, Aker BioMarine ASA did not achieve the adjusted EBITDA target and thus no bonus is earned for the Executive Management, except for the cash bonus to Webjørn Barstad. He has a contractually guaranteed bonus of minimum 80 percent of the annual fixed salary for the years 2021, 2022 and 2023. The bonus accounted for in 2023 to the remaining Executive Management is a discretionary bonus for 2022 decided by the BoD, after the 2022 Remuneration Report was completed and approved.
3.5 EXTRAORDINARY ITEMS, TERMINATION AND SEVERANCE PAYMENTS
In 2023 no extraordinary payments were made to the Executive Management.
4 Development in financial performance and remuneration
Comparison of remuneration and AKBM's performance over the past five years
| USD | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2023 | Dev. | 2022 | Dev. | 2021 | Dev. | 2020 | Dev. | 2019 | Dev. | 2018 | Dev. | |
| Financial performance | ||||||||||||
| Revenue mUSD | 335 300 | 21 % | 277 182 | 6 % | 262 062 | -9 % | 288 588 | 17 % | 246 170 | 58 % | 155 334 | 24 % |
| EBIT margin % | 1,58 % | 8,01 % | -5,21% | 2,42% | 1,12% | 6,60% | ||||||
| Executive management - total remuneration (incl. Salary, bonus, fringe benefits and pension + accrued salary and bonus) |
||||||||||||
| Matts Johansen, CEO | 688 812 | 68 % | 409 761 | -14 % | 477 402 | -24 % | 626 679 | -7 % | 670 850 | -11 % | 752 385 | 150 % |
| Katrine Klaveness, CFO (from 01.09.2018) | 378 292 | 26 % | 301 078 | -12 % | 343 495 | -20 % | 426 925 | 33 % | 321 058 | - | 116 560 | |
| Fredrik Nygaard, CFO (until 28.02.2018) | 25 958 | - | 285 782 | 12 % | ||||||||
| Hege Spaun, Chief Officer People & External Affairs (from 01.09.2020) | 221 240 | 27 % | 174 756 | 3 % | 169 743 | 25 % | 135 402 | |||||
| Tone Lorentzen, EVP Supply Chain | 324 376 | 26 % | 257 766 | -13 % | 295 584 | -23 % | 384 753 | 21 % | 318 326 | 23 % | 259 392 | 136 % |
| Webjørn Barstad, EVP Offshore Supply Chain (from 01.12.20) | 515 107 | 0 % | 516 519 | -12 % | 588 647 | 37 064 | ||||||
| Sigve Nordrum, EVP Animal Health & Nutrition | 304 486 | 23 % | 247 679 | -12 % | 281 010 | -20 % | 349 963 | 24 % | 283 225 | 3 % | 275 127 | 18 % |
| Tim DeHaas, EVP Human Health & Nutrition (from 01.04.2018) | 473 011 | 39 % | 341 025 | 22 % | 278 972 | 6 % | 262 805 | |||||
| Simon Seward, EVP Human Health & Nutrition (from 01.01.22) | 306 305 | 10 % | 279 054 | |||||||||
| Todd Norton, EVP | 265 276 | -27 % | 361 390 | 12 % | 323 097 | 9 % | 297 546 | 30 % | ||||
| Shauna McNeil, EVP Innovation (01.03.2019 - 31.01.2024) |
73 948 | -63 % | 201 229 | -5 % | 211 081 | -26 % | 286 196 | 37 % | 209 629 | |||
| Dave Lang, CEO Lang Pharma Nutrition Inc. (from 01.03.2019 until March 22) | 303 633 | 270 % | 82 108 | 21 % | 68 034 | |||||||
| Seth French, CEO Lang Pharma Nutrition Inc. (from 01.09.2021) | 834 937 | -17 % | 1 009 887 | 191 % | 347 099 | |||||||
| Kristine Hartman, EVP Transformation (until 31.12.20) (1) | 34 825 | 236 853 | -9 % | 261 629 | 0 | 248 996 | 23 % | |||||
| Trond Atle Smedsrud EVP Strategic Investments (2) | 284 927 | 17 % | 244 460 | -6 % | 259 501 | -33 % | 384 635 | 6 % | 362 656 | 56 % | 231 758 | 26 % |
| Average total remuneration of employees (3) | 114 034 | 3 % | 110 750 | 2 % | 108 146 | 6 % | 101 943 | -2 % | 104 456 | -3 % | 107 400 | -6 % |
| Currency rates | 10,5647 | 9,6245 | 8,5991 | 9,4001 | 8,7803 | 8,689 |
MANAGEMENT REMUNERATION REPORT 2023
| Board of directors (4) | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Ola Snøve | 70 045 | -4 % | 72 731 | -11 % | 81 404 | 35 % | 60 276 | 6 % | 56 794 | 25 % | 45 565 | 0 % |
| Kjell Inge Røkke (5) (until April 23) | ||||||||||||
| Øyvind Eriksen (5) (until April 22) | ||||||||||||
| Anne Harris | 48 747 | -1 % | 49 353 | -11 % | 55 238 | |||||||
| Cilia Holmes Indahl | 30 763 | -1 % | 31 170 | -11 % | 34 887 | |||||||
| Kristin Holmgren (employee elected board director) As of June 23 | ||||||||||||
| Thomas Røkke (employee elected board director) As of June 23 | ||||||||||||
| Frank Reite (5) | 41 175 | -1 % | 41 560 | -11 % | 46 516 | 16 % | 30 138 | 183 % | 10 638 | 0 | ||
| Kimberly Mathisen (from May 2022) | 30 763 | 48 % | 20 780 | |||||||||
| Currency rates | 10,5647 | 9,6245 | 8,5991 | 9,4001 | 8,7803 | 8,689 |
1) Annual leave allowance earned in 2020, dispersed in 2021
2) Increased remuneration in 2019 is due to Expatriate assignment
3) Comparison is made for Aker BioMarine ASA and Aker BioMarine Antarctic AS, settled at Full Time Equivalent (FTE) and full year, excluding Executive Management. Total remuneration including base pay, pension, mobile phone, health Life/Disability insurance, bonus.
4) According to policies, there are no remuneration for board members represented by employees and owners. Additional remuneration to audit committee members was introduced in 2021.
5) As per normal practice in Aker for unlisted companies, senior executives are not personally permitted to receive directors' fees from other companies within Aker. Applies to Frank Reite years 2016-mid 2019, Kjell Inge Røkke and Øyvind Eriksen years 2016-2020
The change in annual cash bonus impacts the development in remuneration.
In the 5-year period fluctuations in remuneration of employees are mostly due to NOK/USD exchange rate.
5 Compliance with the Remuneration Policy
The remuneration of the Board and the Executive Management complies with the guidelines and framework set out in the Remuneration Policy.
6 The Board of Director's Statement on the Report
The Board of Directors has today considered and adopted the Remuneration Report of Aker BioMarine ASA for the financial year 2023. The report has been prepared in accordance with paragraph 6-16a and 6-16b of the Norwegian Public Limited Liability Companies Act (in Norwegian: 'Allmennaksjeloven').
The Remuneration Report will be presented to the Annual General Meeting 2024 for an advisory note.
Oslo, 18 March 2024 The Board of Directors and CEO of Aker BioMarine
Independent Auditor's Statement of the Remuneration Report
