Grieg Seafood — Earnings Release 2014

Feb 19, 2015

Grieg Seafood ASA

Q4 2014

Atle Harald Sandtorv | CFO/Acting CEO

Knut Utheim | COO

19 February 2015

Agenda

• •Highlights
• •Business Units (Regions)
• •Financials
• •Outlook

HIGHLIGHTS Q4 2014

Highlights Q4 2014

• •EBIT before FV adjustment of biomass MNOK 140 in Q4 2014.
• •EBIT before FV adjustment of biomass MNOK 341 YTD.
• •MNOK 60 gain from sales of SalmoBreed AS included in above EBIT.
• •Good seawater production in BC.
• •Gill disease in combination with sea lice treatment causing MNOK 19 write down in Shetland.
• •Increasing prices, but weaker marked due to trade sanctions against Russia.
• •Andreas Kvame new CEO, starting within 1 June.

Financial highlights Q4 2014

	Q 4 2 0 1 4	Q 4 2 0 1 3	Y T D 2 0 1 4	Y T D 2 0 1 3
To l o ing inc ( T N O K ) ta t p era om e	7 6 5 8 2 9	6 9 5 7 1 1	2 7 3 9 0 4 1	2 4 2 5 0 4 1
E B I T D A ( T N O K )	1 8 1 4 9 5	1 2 1 9 3 9	4 8 1 4 6 6	4 8 4 3 3 0
E B I T be for fa ir v lue d j. ( T N O K ) e a a	1 4 0 1 4 0	8 6 9 7 5	3 4 0 8 5 7	3 4 8 2 9 3
E B I T / kg ( N O K )	8, 7 9	5, 4 4	5, 2 7	6, 0 0
Ha lum ( ) t v to rve s o e ns g we	1 5 9 4 1	1 5 9 9 5	6 4 7 3 6	5 8 0 6 1

• •EBIT/kg excl. capital gain SalmoBreed: NOK 5,0.
• •0.3% volume decrease.
• •1.4% average increase in realised prices.

BUSINESS UNITS(REGIONS)

Business units performance – Q3 2014

Business units performance – YTD 2014

GSF Rogaland

• •Seawater production as expected.
• • The growth rate among fish previously affected by PD slightly lower than normal.
• • Harvest late in the quarter affecting average price positive.
• • Harvest from PD and AGD locations moving the cost up.

	Q 4 2 0 1 4	Q 4 2 0 1 3	Y T D 2 0 1 4	Y T D 2 0 1 3
Ha ( ) t t rve s g w	3 1 7 5	2 6 1 7	1 2 7 7 8	1 5 0 8 8
Sa les re ve nu es	1 4 6 9 6 8	1 1 9 1 9 4	5 7 2 5 5 0	6 4 0 5 8 4
E B I T	2 5 5 9 8	1 8 2 7 6	7 7 8 3 5	1 4 4 7 9 4
E B I T / kg	8, 0 6	6, 9 8	6, 0 9	9, 6 0
f w h ic h Ma ke N O K / kg ts o r	0, 3 0 -	0, 8 7	0, 5 5	0, 5 8

GSF Finnmark

• Seawater production as expected, except for occurrence of IPN in some locations.
• Challenges with maturation early in the quarter moving the average price down.
• • Cost in Q4 was slightly lower than the corresponding figure for fish harvested in Q3 2014. However, there are variances in cost per location harvested.
• •Final allocation of 4 green licences.
• • Harvest guiding down in 2015 due to site/area structure, moving the cost/kg up.

	Q 2 0 4 1 4	Q 2 0 3 4 1	Y T D 2 0 1 4	Y T D 2 0 3 1
Ha ( ) t t rve s g w	5 8 0 4	5 7 3 5	2 6 4 7 0	2 3 0 7 6
Sa les re ve nu es	2 0 9 6 9 6	2 0 9 2 0 4	9 7 5 2 9 1	8 7 0 0 8 1
E B I T	3 8 1 7 5	5 0 4 2 4	2 0 5 9 3 4	2 1 6 7 7 8
E B I T / kg	6, 5 8	8, 7 9	7, 7 8	9, 3 9
f w h ic h Ma ke N O K / kg ts o r	0, 2 7	0, 0 4	0, 3 0	0, 1 3

GSF BC (Canada)

• • Seawater production better than planned in Q4.
• •Smolt production according to plan in Q4.
• •Low harvest volume in Q4 .
• •Cost expected to decrease in 2015.

	Q 4 2 0 1 4	Q 4 2 0 1 3	Y T D 2 0 1 4	Y T D 2 0 1 3
Ha ( ) t t rve s g w	6 2 0	8 7 8	6 2 5 7	6 7 3 9
Sa les re ve nu es	4 1 7 0 4	6 2 4 3 1	2 7 7 7 5 7	3 3 0 6 8 2
E B I T	9 7	1 1 8 0 6 -	4 7 8 1 0 -	7 7 7 7 -
E B I T / kg	0, 1 6	1 3, 4 4 -	7, 6 4 -	1, 1 5 -

GSF Shetland

• • Gill disease combined with sea lice treatment caused increase in mortality.
• • The fish harvested in Q4 were affected by high treatment costs.
• •Sales margin from OQ increasing.

	Q 4 2 0 1 4	Q 4 2 0 1 3	Y T D 2 0 1 4	Y T D 2 0 1 3
Ha ( ) t t rve s g w	6 3 4 2	6 7 6 5	1 9 2 3 1	1 3 1 5 8
Sa les re ve nu es	3 0 2 9 0 4	3 0 1 2 0 9	8 5 2 4 5 5	5 6 7 4 3 2
E B I T	2 6 3 3 4	4 2 5 6 5	8 1 0 8 7	2 7 2 7 9
E B I T / kg	4, 1 5	6, 2 9	4, 2 2	2, 0 7
f w h ic h Ma ke N O K / kg ts o r	2, 8 4		1, 0 9

Ocean Quality (sales Norway/UK – associated company – 60%)

• • Negative development in Norway:
• •Total margin moving down.
• •Price achieved vs. market (NOS): 101%
• •Contract share Norway 8%.
• • Stronger performance in Shetland:
• •Positive margin from sales.
• •Price achieved vs. market (NOS + 5,15): 108%
• •Contract share UK 31%.

Financials

Profit and Loss

A l l f ig in N O K 1, 0 0 0 ure s	Q 2 0 4 1 4	Q 2 0 3 4 1	Y T D 2 0 1 4	Y T D 2 0 3 1
To l o ing inc ta t p era om e	7 6 5 8 2 9	6 9 5 7 1 1	2 7 3 9 0 4 1	2 4 2 5 0 4 1
E B I T D A	8 9 1 1 4 5	2 9 3 9 1 1	8 6 6 4 1 4	8 3 3 0 4 4
De ia ion d a isa ion t t t p rec an mo r	4 1 3 5 5 -	-3 4 9 6 4	-1 4 0 6 0 9	-1 3 6 0 3 7
E B I T be fo b iom d j re as s a	0 0 1 4 1 4	8 6 9 7 5	3 0 8 4 5 7	3 8 2 9 3 4
Fa ir v lue d j b io log ica l a ts a a ss e	1 1 6 9 6 7	1 7 4 4 9 4	-1 2 7 1 0 8	2 6 7 4 5 0
E B I T a f b iom d j. te r as s a	2 5 7 1 0 7	2 6 1 4 6 8	2 1 3 7 4 9	6 1 5 7 4 3
S ha f p f i fro ies t re o ro m as s. co mp an	-7 8	1 6 6	2 8 6 5	2 2 4 4
Ne f ina ia l t nc	-1 6 2	-1 7 1 6 9	-5 5 7 2 2	-7 3 0 5 7
Pr f i be fo t tax o re	2 6 8 6 5 7	2 6 6 4 4 4	6 0 8 9 2 1	9 3 0 5 4 4
Es im d ion t te tax t a a	-4 8 0 9 7	-2 9 2 4 6	-2 2 8 0 6	-1 1 3 9 4 5
Ne f i in he io d t p t t ro p er	2 0 8 7 7 0	2 1 5 2 1 9	1 3 8 0 8 6	4 3 0 9 8 5

Net financial

A l l f ig in N O K 1 0 0 0 ure s ,	Q 4 2 0 1 4	Q 4 2 0 1 3	Y T D 2 0 1 4	Y T D 2 0 1 3
C ha in fa ir v lue fro he dg ing ins tru ts ng es a m me n	-1 1 7 5 4	-6 9 5	-8 3 7 7	4 2 7 6
Ne f ina ia l in t te t nc res	-2 0 9 8 4	-2 4 9 2 3	-8 5 4 1 6	-9 5 4 8 6
Ne in ( los ) t c urr en cy g a se s	3 4 5 0 7	9 8 0 8	4 5 9 9 4	2 5 8 8 2
D iv i de ds n	0	2 7	4 7 4	4 9 5
Ne he f ina ia l e /- inc t o t r nc xp en se s om e	-1 9 3 1	-1 3 8 6	-8 3 9 6	-8 2 2 4
Ne f in ia l i t te an c m	-1 6 2	-1 7 1 6 9	-5 5 7 2 2	-7 3 0 5 7

Investments

Maintenance levelCapex

Cash Flow

Net Interest Bearing Debt

NIBD

M N O K	Q 4 2 0 1 4	Q 4 2 0 1 3
T L e r m o a n	8 5 5	5 5 5
R l i C d i t e o n g r e v v	2 0 0	4 2 5
B d o n	4 0 0	4 0 0
L i e a s n g	2 9 0	2 1 6
O h i b i d b t t t t e r n e r e s e a r n g e	3	1 2
C h l i b l a s c o s n g a a n c e -	1 4 4 -	1 6 4 -
N I B D	1 6 0 4	1 4 4 5

Balance sheet 1

A S S E T S	3 1. 1 2. 1 4	3 1. 1 2. 1 3
Go dw i l l o	10 8 70 8	10 7 3 10
L ice ns es	1 0 6 6 18 4	9 9 4 0 6 6
Ot he inta i b le a ets r ng ss	11 5 17	4 5 45
Pro lan d e ip ert t a nt p y, p n q u me	1 4 24 5 6 2	1 2 0 4 2 0 7
Inv in a itat d a d j int ies tm ts ntu es en ss oc e n o ve re co mp an	41 9 3 7	41 19 0
Ot he nt ts r n on -cu rre as se	1 5 8 5	2 6 6 7
To l n ta nt ts on -cu rre as se	2 6 5 4 4 9 3	2 3 5 3 9 8 6
Inv ies tor en	8 8 25 0	74 0 15
B io log ica l as ts se	1 5 6 2 8 12	1 3 6 8 3 21
Fa ir v lue b io log ica l as ts a se	28 1 2 8 5	3 9 8 0 11
Ac iva b le ts co un rec e	25 4 0 43	17 7 8 15
Ot he iva b les t re r c urr en ce	5 7 2 8 7	5 4 0 15
De iva d o he f ina ia l ins tes t tru nts r an r nc me	0	5 18
Ca h a d c h e iva len ts s n as q u	144 0 0 3	16 3 9 13
To ta l c nt ts ur re as se	2 3 8 7 6 7 9	2 2 3 6 6 0 8
To ta l a ets ss	5 0 4 2 1 7 2	4 5 9 0 5 9 4

Balance sheet 2

Q S E U I T Y A N D L I A B I L I T I E	3 2. 1. 1 1 4	3 2. 3 1. 1 1
S ha ita l re ca p	44 6 6 48	44 6 6 48
Tre S ha as ury res	-5 0 0 0	5 0 0 0 -
Re ine d e ing d o he ity ta t arn s a n r e q u	1 7 8 0 27 0	1 5 46 9 10
To l e ity ta q u	2 2 21 9 1 8	1 9 8 8 5 5 8
De fer d t l ia b i l it ies re ax	5 5 9 5 42	5 5 7 3 5 0
Pe ion d o he b l ig ion t at ns - a n r o s	2 5 3 2	6 10
Su bo d ina d loa te r ns	22 79 5	22 5 9 8
Bo ing d lea ing rro s a n s w	1 1 9 6 10 3	1 0 22 3 5 4
To l n l ia b i l it ies ta nt on -cu rre	1 7 8 0 9 7 2	1 6 0 2 9 1 3
S ho loa fac i l it ies rt-t erm n	5 40 8 9 5	5 8 2 2 0 9
Ac b le ts co un p ay a	3 0 0 5 21	3 17 75 3
Ta b le x p ay a	5 0 6 45	1 4 71
De iva d o he f ina ia l ins tes t tru nts r an r nc me	23 47 5	11 6 3 1
Ot he l ia b i l it ies t r c urr en	12 3 74 6	8 6 0 5 9
To l c l ia b i l it ies ta nt ur re	1 0 3 9 2 8 2	9 9 9 1 24
To l l ia b i l it ies ta	2 8 2 0 25 4	2 6 0 2 0 3 6
To l e ity d l ia b i l it ies ta q u an	5 0 4 2 1 7 2	4 5 9 0 5 9 4

Key financial indicators

	Q 2 0 4 1 4	Q 2 0 3 4 1	Y T D 2 0 1 4	Y T D 2 0 3 1
E B I T D A- i b f d j b i m a r g n e o r e a o m a s s	2 4 %	1 8 %	1 8 %	2 0 %
E B I T- i b f d j b i m a r g n e o r e a o m a s s	1 8 %	1 3 %	1 2 %	1 4 %
N I B D / E B I T D A b f d j b i e o r e a o m a s s	3, 3	3, 0	3, 3	3, 0
R O C E b f d j b i e o r e a o m a s s	1 6 %	1 2 %	1 0 %	1 2 %
E i i t t q u y r a o	4 4 %	4 3 %	4 4 %	4 3 %

OUTLOOK

Harvest estimate

Gu i d ing 2 0 1 5 ( ) 1, 0 0 0 ton s g e w	Ro la d g a n	F in k nm a r	C B	S he la d t n	G S G F ro u p
Q 1	2, 7	6 5,	1, 7	3, 8	3, 9 1
G h % t r o w	2 8 %	-3 %	6 3 %	-7 %	6 %
Q Q 2- 4	1 7, 8	1 6, 4	1 1, 3	1 2, 7	5 8, 1
G h % t r o w	6 7 %	-2 1 %	1 1 7 %	-1 6 %	1 2 %
T l t o a	2 0, 5	2 2, 0	3, 0 1	6, 1 5	2, 0 7
G h % t r o w	6 0 %	-1 7 %	1 0 8 %	-1 4 %	1 1 %

• • 2015 guidance of 72,000 MT.
• •Production in BC close to normal.
• • Finnmark/Shetland guiding down due to site/area structure, expected to increase in 2016.

Supply outlook

• Global supply growth 2014 vs 2013 9%
• Lower global supply growth (3%) in 2015 vs. 2014
• Norway stable growth rate:
• 2014: +5%
• 2015: +4% (1,123' MT)
• Chile form positive to negative growth rate:
• 2014: +25%
• 2015: -4% (505' MT)
• • Canada – from negative to positive growth rate:
• 2014: -11%
• 2015: +19% (130' MT)
• UK increased growth rate:
• 2014: +9%
• 2015: +3% (160' MT)

NOS (Norway) price development :

Outlook summary

• •Limited supply growth is expected to result in a strong market in the period ahead.
• • Harvest volume guiding 2015 of 72,000 MT. Increasing 7,000 MT vs 2014. Growth expected to continue in 2016.
• Ocean Quality is developing its business to include the sale of GSF's fish in BC effective from and including Q1 2015.
• Andreas Kvame has been appointed CEO of the company and will start no later than 1 June 2015.
• • The company's main goal is lower cost through continuous improvement of biological performance, including better utilisation of licences/equipment.
• 4 new green licences in Finnmark represent a solid basis for growth in this region.
• • Considering new debt facilities to strengthen financial flexibility to refinance (bond) and pursue further growth opportunities.
• •Dividend to be decided in connection with the annual accounts 2014.

Thank you !

APPENDIX

Share info

• − Number of shares
• •111.7 million (after full conversion of bonds in August 2009).
• − Last issues: Q2 2009
• •139 MNOK new share issue.
• − Subordinated convertible bond issue: Q1 2009
• •100 mill. convertible at NOK 4.00 per share within 31.12.2010.
• •85% converted in Q2 2009.
• •15% converted in Q3 2009.
• − EPS
• •1,95 NOK/share Q4 2013.
• •1,89 NOK/share Q4 2014.
• − Shareholder structure
• •Largest 20 have 94.23% of total no. of shares.

Shareholders

	No ha . s re s	%
G R I E G H O L D I N G S	5 5 8 0 1 4 0 9	49 9 7 % ,
D N B N O R M A R K E T S, A K S J E H A N D / A N A L Y S E	22 18 8 23 8	19 8 7 % ,
N O R D E A B A N K N O R G E A S A M A R K E T S	6 6 0 5 9 9 8	5, 9 2 %
K O N T R A R I A S	6 5 5 9 3 0 9	5, 8 7 %
Y S T H O L M E N	2 9 28 19 7	2, 6 2 %
O M H O L D I N G A S	2 6 10 0 0 0	2, 3 4 %
S T A T E S T R E E T B A N K A N D T R U S T C O.	1 3 0 5 9 0 1	1, 17 %
G R I E G S E A F O O D A S A	1 2 5 0 0 0 0	1, 12 %
K V A S S H Ø G D I A S	1 0 0 0 0 0 0	0, 9 0 %
S K A N D I N A V I S K A E N S K I L D A B A N K E N A B	8 5 0 74 2	0, 76 %
G R I E G S H I P P I N G I I A S	8 24 5 6 5	0, 74 %
V E R D I P A P I T F O N D E T D N B S M B	8 0 2 7 6 2	0, 72 %
V E R D I P A P I R F O N D E T P A R E T O N O R D I C	47 5 0 0 0	0, 43 %
S T O R E B R A N D V E K S T	44 7 7 13	0, 40 %
H S B C B A N K P L C	3 9 4 1 79	0, 3 5 %
T H E B A N K O F N E W Y O R K M E L L O N	3 27 9 3 9	0, 29 %
S T A T E S T R E E T B A N K & T R U S T C O M P A N Y	22 5 0 0 0	0, 20 %
G R I E G L T D A / S	21 7 3 9 0	0, 19 %
M P P E N S J O N P K	20 4 9 9 1	0, 18 %
P I C T E T & C I E ( E U R O P E ) S. A	20 2 4 78	0, 18 %
To l 2 0 lar ha ho l de ta t s g es re rs	1 0 5 2 21 8 11	9 4, 2 3 %
To l ot he ta r	6 44 0 18 9	5, 77 %
To l n be f s ha ta um rs o re s	11 1 6 6 2 0 0 0	1 0 0, 0 0 %

Profit and Loss

All figu in NO K 1 000 res ,	Q 4 2 01 4	Q 4 2 01 3	YT D 2 01 4	YT D 2 01 3
To tal tin inc op era g om e	765 82 9	695 71 1	2 7 39 041	2 4 25 041
Sh of ofit fro m jo int tur are pr ven e	1 6 64	208	10 002	5 6 45
Ch e in inv orie ent ang s	95 495	95 668	116 24 3	133 26 1
Raw ials d c abl d ter ma an ons um es use	377 08 8 -	37 1 0 46 -	1 2 69 768 -	1 1 02 239 -
Sa lari and l ex es pe rso nne pen ses	96 897 -	90 37 1 -	339 59 2 -	302 22 3 -
Oth ing rat er ope ex pen ses	207 50 8 -	208 23 1 -	774 46 0 -	675 15 5 -
EB ITD A	181 49 5	121 93 9	481 46 6	484 33 0
Dep iati and isa tion ort rec on am	38 188 -	34 423 -	135 38 7 -	-13 3 4 68
Dep iati and isa tion of lic ort rec on am ens es	3 1 67 -	541 -	-5 222	2 5 69 -
Imp airm ad jus ent tme nts set on as s	0	0	0	0
EB IT be for e b iom dj as s a	140 0 14	86 975	340 85 7	348 29 3
Fai lue ad j bio log ica l as set r va s	116 96 7	174 49 4	127 10 8 -	267 45 0
EB IT a fte r b iom dj. as s a	257 10 7	261 46 8	213 9 74	615 3 74
Sh of ofit fro ani are pr m a ss. co mp es	-78	166	2 8 65	2 2 44
Net fin ial anc	-16 2	17 169 -	55 722 -	73 057 -
Pro fit be for d b iom dj e t ax an as s a	139 90 0	69 972	288 00 0	277 48 0
Pro fit b efo re t ax	256 86 7	244 46 6	160 89 2	544 93 0
Est ima ted atio tax n	-48 09 7	29 246 -	22 806 -	113 94 5 -
Ne rof it i he rio d t p n t pe	208 77 0	215 21 9	138 08 6	430 98 5