Grieg Seafood — Earnings Release 2024

Nov 27, 2024

Grieg Seafood ASA: Q3 2024 results

Grieg Seafood ASA: Q3 2024 results

Figures for Q3 2023 in brackets

Highlights

* Harvest volume of 17,806 tonnes (12,245 tonnes)

* Operational EBIT in the quarter of NOK -175 million (NOK -86 million), with

operational EBIT/kg of NOK -9.8 (-7.0). Operational EBIT from Farming Norway

of NOK 69 million while NOK -218 million from BC due to algae bloom and low

DO (dissolved oxygen)

* All-time high production in Norway and MAB (maximum allowable biomass) fully

utilized at quarter end - biomass in Finnmark rebuilt post-Spiro

* Process to identify long-term partners to take part in the development of

Canadian operations is progressing

* Dialogue with interested parties for both strategic partnership and

business sale

* Established NOK 750 million bridge loan facility to maintain financial

flexibility

* Expect to harvest 24,400 tonnes in Q4 2024, target harvest volume for the

full year 2024 at 78,500 tonnes

Financial results

Operational EBIT for Grieg Seafood was negative by NOK 175 million in the

third quarter of 2024, compared to negative NOK 86 million in the

corresponding period in 2023. Harvest volume was 17,806 tonnes during the

period (12,245), which gives an operational EBIT/kg of NOK -9.8 (-7.0).

In Rogaland, harvest volume for the quarter was 8,543 tonnes (4,783), up 79%

compared to third quarter 2023. Underlying operational performance was good

with efficient utilization of MAB (maximum allowable biomass) throughout the

quarter and fully utilized at quarter-end. The price achievement in Rogaland

was supported by higher average harvest weights (avg 4.0 kg) compared to Q3

2023, however dampened by lower market prices and lower harvest volumes in the

beginning of the quarter when the prices were higher. Operating EBIT/kg ended

at NOK 8.8 (0.7).

In Finnmark, harvest volume for the quarter ended at 6,045 tonnes (1,354).

Strong seawater production during the quarter resulted in harvest volume being

1,000 tonnes above guiding as biomass was rebuilt at MAB during the quarter.

Earnings were positively impacted by a significantly improved superior share

of 97% compared to 50% in Q3 2023, however suppressed by lower average harvest

weights, in addition to timing of the harvest at the end of the quarter, when

the spot prices were lower. Operational EBIT/kg ended at NOK -1.0 (-27.1).

Seawater production in British Columbia was challenging in the beginning of

the quarter with extended events of low dissolved oxygen (low DO) and algae

bloom, causing an increase in mortality rates and reduced growth. However,

production improved at the end of the quarter, with stable production going

into Q4. The price achievement was negatively impacted by low average harvest

weights and lower share of superior quality fish, which ended at 83% for the

quarter. As a consequence of the algae bloom and related write-downs,

operational EBIT/kg ended at NOK -67.7 (-3.2) on a harvest volume of 3,217

tonnes (6,108), overall, in line with the estimate for the quarter given in

the Q2 2024 quarterly report.

Seawater production in Newfoundland was good in the quarter and according to

previously communicated production plans, the Newfoundland operations had no

harvest during the period.

Commenting on the quarter, Andreas Kvame, CEO of Grieg Seafood ASA said:

"The third quarter of 2024 was a mixed bag for Grieg Seafood. While the

financial performance was impacted by seasonally lower spot prices and carry

costs from historic incidents, our underlying performance was good.

Development was particularly good in Rogaland and Finnmark, as we are going

out of Q3 with a record-high standing biomass in sea in Norway after an

all-time high seawater production over the quarter.

Finnmark experienced strong seawater production during the quarter, maximizing

MAB capacity and rebuilding biomass post-Spiro. The region is still facing

biological challenges and the company faced sea lice challenges during the

quarter. However, we are pleased to register that proactive investments in

treatment capacity are proving positive results, contributing to better

biological control and fish welfare. Earnings in the region were impacted by

the seasonally lower prices and harvest of the remaining Spiro-impacted fish.

Farming costs continued down, confirming our expectations of a continued

positive development in this region.

Also, Rogaland experienced strong seawater production, driven by high

capacity-utilization and good biology. While earnings were impacted by the

lower prices, costs came down during the quarter and are expected to remain

stable in the coming quarter.

Operations in British Columbia were impacted by occurrence of algae bloom,

significantly reducing survival-rates and impacting growth. Harvesting for

2024 was completed during the quarter ending at 12,500 tonnes. A decision on

the transition plan for the salmon farming industry in the region is yet to be

made. As Grieg Seafood awaits the transition plan to be concluded, investments

are put on hold.

Our operations in Newfoundland continue to develop according to plan. No fish

were available for harvesting during the quarter. Harvesting of the second

generation commenced in October and total harvest for the full year is

expected to end at around 11,000 tonnes.

Looking forward, investments in operational assets and biomass are mainly

developing according to plan. We are excited for Rogaland's first smolt

stocking in Årdal Aqua and look ahead to the completion of the facility's

remaining units in 2025. I am also pleased to say the construction of our new

post-smolt facilities in Finnmark and Newfoundland, in addition to the VAP

facility at Gardermoen, is progressing well."

Operational update for Q4 2024

So far in the fourth quarter, we have primarily experienced good seawater

production in all of our regions. In Finnmark, we have, unfortunately, been

hit by string jellyfish at our site Vinnalandet, causing elevated mortality at

this farming location. The situation is monitored closely, and measures have

been taken to safeguard fish welfare. The company has already executed early

harvests, and due to the lower harvest weight, farming cost for Q4 2024 is

therefore expected to increase compared to Q3 2024. The lower harvest weight

will also have negative impact on price achievements. Costs related to

mortality write downs and higher harvest cost are estimated in the range of

NOK 70 to 90 million for Q4 2024.

Maintaining financial flexibility as loan agreement entered into in Q4 2024

To maintain financial flexibility, Grieg Seafood ASA has in Q4 2024 entered

into a NOK 750 million bridge term loan facility with Nordea Bank AbP, filial

i Norge and DNB Bank ASA as arrangers and lenders.

Outlook

The global supply of Atlantic salmon in 2024 is expected to slightly increase

compared to 2023. With expectations of limited supply growth in 2024, combined

with an outlook for continuing strong demand fueled by an increased focus on

healthy food and sustainably produced proteins, we expect a sustained good

market.

Estimated contract share for the Norwegian operations is 7% for Q4 2024 and 8%

for the full year 2024.

In the fourth quarter of 2024, expected harvest volume is 24,400 tonnes,

distributed as follows:

* Rogaland: 7,300 tonnes

* Finnmark: 11,400 tonnes

* BC: 0 tonnes

* NL: 5,700 tonnes

The company guides for a harvest volume of 78,500 tonnes in 2024 (unchanged

since Q2 2024 reporting), distributed as follows:

* Rogaland: 28,000 tonnes

* Finnmark: 27,000 tonnes

* BC: 12,500 tonnes

* NL: 11,000 tonnes

For 2025, the company guides for a harvest volume of 84,000 tonnes,

distributed as follows:

* Rogaland: 30,000 tonnes

* Finnmark: 32,000 tonnes

* BC: 12,000 tonnes

* NL: 10,000 tonnes

Results presentation

Chief Executive Officer (CEO) Andreas Kvame and Chief Financial Officer (CFO)

Atle Harald Sandtorv will present the results live at Hotel Continental,

Stortingsgaten 24/26, Oslo today at 08:00 a.m. CET.

A live webcast from the presentation can be accessed at

https://investor.griegseafood.com/reports-&-presentations#quarterly

or with the following link:

https://channel.royalcast.com/landingpage/hegnarmedia/20241127_2/

An English transcript of the presentation will be made available at

https://investor.griegseafood.com/.

For further enquiries, please contact:

Andreas Kvame, CEO

Cell phone: +47 907 71 441

Atle Harald Sandtorv, CFO

Cell phone +47 908 45 252

About Grieg Seafood

Grieg Seafood ASA is one of the world's leading salmon farmers. Our farms are

in Finnmark and Rogaland in Norway, and British Columbia as well as

Newfoundland in Canada. Our headquarter is located in Bergen, Norway. Grieg

Seafood ASA was listed at the Oslo Stock Exchange in June 2007.

Sustainable farming practices are the foundation of Grieg Seafood's

operations. The lowest possible environmental impact and the best possible

fish welfare is both an ethical responsibility and drive economic

profitability.

To learn more, please visit https://griegseafood.com/.

The information included in this announcement may partly be defined as inside

information pursuant to article 7 of the Market Abuse Regulation. The

information is publicly disclosed in accordance with article 17 of the Market

Abuse Regulation as well as section 5-12 of the Norwegian Securities Trading

Act.

The stock exchange announcement was published by May Hansen, Administrative

Secretary, Grieg Seafood Group ASA, on 27 November 2024 at 6:00 a.m. CET.