Leroy Seafood Group ASA · OSL:LSG
Leroy Seafood Group ASA — Lerøy Seafood Group — Q4 2009 Earnings Presentation
45 slides from Leroy Seafood Group ASA's earnings presentation, Feb 25, 2010
Slide 1: Preliminary financial figures 2009
Lerøy Seafood Group Preliminary financial figures 2009 February 25th 2010 Helge Singelstad Chairman Alf-Helge Aarskog CEO Ivan Vindheim CFO 1
Slide 2: Agenda
Agenda 1 1. Considerations 2. 2 Key financial figures Q4 2009 3. 3 Lerøy at a glance 4. 4 Market glance 2
Slide 3: Highlights as per Q4 2009
Highlights as per Q4 2009 • Record high volumes, turnover, and profit • Biology satisfactory • However, still significant regional differences • RFS-cost falling • Sales and Distribution another extremely good quarter • NIBD considerably down • Dividend 3
Slide 4: Internal considerations Q4 2009
Internal considerations Q4 2009 All figures in NOK mill Q4 - 09 Q4 - 08 Change YTD Q4 09 YTD Q4 08 Change Turnover 2 184 1 703 28 % 7 474 6 057 23 % EBITDA 366 149 146 % 1 154 534 116 % EBIT bef adj biom 311 100 211 % 950 337 182 % PTP bef adj biom*) 311 60 417 % 927 201 361 % *) PTP = Pre-Tax Profi
Slide 5: Turnover LSG
Turnover LSG NOK million 8 000 7 500 7 000 6 500 6 000 5 500 5 000 4 500 4 000 3 500 3 000 2 500 2 000 1 500 1 000 500 0 1980 1985 1990 1995 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 5
Slide 6: EBIT LSG pre biomass adj
EBIT LSG pre biomass adj NOK million 1 000 800 600 400 200 0 LSG was listed on Oslo Stock Exchange in 2002 6
Slide 7: Quarterly EBIT LSG pre biomass adj
Quarterly EBIT LSG pre biomass adj NOK million 350 300 250 200 150 100 50 0 7
Slide 8: Return on Capital Employed (ROCE)
Return on Capital Employed (ROCE) Pre biomass adjustment 35 30 25 20 Percent 18%* 15 10 5 0 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 * Target communicated at the listing on Oslo Stock Exchange 03.06.2002 8
Slide 9: Annual Dividend since 1995
Annual Dividend since 1995 400 7% 350 6% 300 5% NOKm 250 4% Dividend 200 3% Yield 150 100 2% 50 1% 0 0% 199519961997199819992000200120022003200420052006200720082009 Listed on Oslo Stock Exchange 03.06.2002 9
Slide 10: Creating Shareholders' Value
Creating Shareholders’ Value 7 000 7% 6 000 6% 5 000 5% NOKm 4 000 4% Market Cap 3 000 3% Yield 2 000 2% 1 000 1% 0 0% 1997199819992000200120022003200420052006200720082009 Listed on Oslo Stock Exchange 03.06.2002 10
Slide 11: Years with Sustainable growth, more to come!
8 Years with Sustainable growth, more to come! 8 000 120 000 7 000 100 000 6 000 NOKm GWT 80 000 Market Cap 5 000 4 000 60 000 EV 3 000 40 000 GWT 2 000 1 000 20 000 0 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 Listed on Oslo Stock Exchange 03.06.2002 11
Slide 12: Internal considerations Q4 2009 cont'd
Internal considerations Q4 2009 cont’d • Production • Volumes in line with 2009E • Development in operations satisfactory • In general, lower production costs • Biological performance • Feed prices • Economies of scale • However, Lerøy Vest a poor quarter profitwise • Harvested out 08gS1 in Q4 09 •
Slide 13: Internal considerations Q4 2009 cont'd
Internal considerations Q4 2009 cont’d Affiliated companies • Improved biological performance • Lower production costs and higher prices year on year (Norskott/Scottish Sea Farms) • Positive development expected to continue • Financially solid • Net interest bearing debt significantly down in Q4 09
Slide 14: External considerations Q4 2009
External considerations Q4 2009 • Demand and supply • Strong spot prices, but seasonally down in Q4 • -13.2% Q4 09 vs Q3 09 • 8.6% Q4 09 vs Q4 08 • Contract prices more in line with spot prices in Q4 • Significant supply growth from Norway in Q4 • 27.3% in Q4 09 vs Q4 08 • 16.3% FY 09 vs FY 08 • Sup
Slide 15: Agenda
Agenda 1. 1 Considerations 2. 2 Key financial figures Q4 2009 3. 3 Lerøy at a glance 4. 4 Market glance 15
Slide 16: Income Statement Q4 2009
Income Statement Q4 2009 All figures in NOK 000 16
Slide 17: Balance Sheet Q4 2009
Balance Sheet Q4 2009 All figures in NOK 000 17
Slide 18: Cash Flow Statement Q4 2009
Cash Flow Statement Q4 2009 All figures in NOK 000 18
Slide 19: Key figures - Lerøy Seafood Group Q4 2009
Key figures - Lerøy Seafood Group Q4 2009 1) Resultatmargin = Resultat før skatt / Salgsinntekter Profit margin = Profit before tax / Revenues 2) Driftsmargin = Driftsresultat / Salgsinntekter Operating margin = Operating profit / Revenues 3) Resultat per aksje = Majoritetens andel resultat / Gjenno
Slide 20: Funding
Funding • Sound debt repayment profile • Bank loans and no “balloons” NOK million 2009 2010 2011 2012 2013 Instalments 224 259 246 233 233 • Covenants NIBD/EBITDA < 5 and Equity ratio*) > 30% • Q4 2009, 1.3 and 59.1 % respectively • Satisfactory committed unused credit lines • CAPEX more in line wit
Slide 21: Agenda
Agenda 1.1 Considerations 2.2 Key financial figures Q4 2009 3.3 Lerøy at a glance 4.4 Market glance 21
Slide 22: Lerøy Seafood Group - Global organization
Lerøy Seafood Group - Global organization Norway Farming Sweden Dist. & Sales Dist. & Sales Scotland/Shetland Farming Dist. & Sales Japan Spain, Portugal, Dist. & Sales Turkey France Dist. & Sales Dist. & Sales China Dist. & Sales North America Dist. & Sales Chile 22
Slide 23: Lerøy Seafood Group ASA
Lerøy Seafood Group ASA Sales & Distribution Production Affiliated Hallvard Lerøy AS Lerøy West Norskott Havbruk AS** 100% 100% 50% Lerøy Sverige AB Lerøy Mid-Norway Alfarm Alarko Lerøy*** 100% 100% 50% Lerøy North SAS Hallvard Lerøy 100% 100% Lerøy Fossen AS Nordvik SA = Salmon farming, processing
Slide 24: Lerøy Seafood Group
Lerøy Seafood Group • • Global distribution network • Global distribution from Head Office in Bergen • Local distribution and processing in Norway, Sweden, France, Portugal, and Turkey • Local representative offices in some key markets (France, Japan, China and USA) • 12.4% share of Norwegian seafoo
Slide 25: Lerøy Seafood Group
Lerøy Seafood Group • Fully integrated • From roe to the plate • Competent employees • Decentralized farming units • Autonomous units in three regions • In addition, the affiliated company Scottish Sea Farms in Scotland • Processing plants • Smokehouses • Fillets, portions etc • Post / pre-rigor • C
Slide 26: Lerøy Seafood Group
Lerøy Seafood Group • Market strategy: • Quality • Presence in major seafood markets • Branding • Diversity in product range • Diversity in customer base • Market-oriented solutions • Geographical spread • Continuity in deliveries • Cost efficiency 26
Slide 27: Sales per market Q4 09
Lerøy Seafood Group - Sales per market Q4 09 27
Slide 28: Sales per product Q4 09
Lerøy Seafood Group - Sales per product Q4 09 28
Slide 29: Farming Norway
Farming Norway • Lerøy Aurora AS (salmon) • Sigerfjord Aqua AS (Arctic char) • Lerøy Midnor AS (salmon) • Lerøy Hydrotech AS (salmon) • Lerøy Vest AS (salmon and trout) 29
Slide 30: Salmon/trout farming
Lerøy Seafood Group – Salmon/trout farming Company Ownership Licences Mill. smolt 2008 2009 2010E share No individuals GWT GWT GWT Lerøy Midnor AS 100 % 30 9,5 29 100 35 000 36 500 Lerøy Aurora AS 100 % 17 5,0 17 200 19 300 20 500 Lerøy Hydrotech AS 100 % 24 7,0 23 000 21 500 24 000 Lerøy Vest AS 10
Slide 31: Key Figures Production Q4 2009
Key Figures Production Q4 2009 *) *) **) Lerøy Others / Total Total Figures NOKm Lerøy Midnor Hydrotech Lerøy Aurora Lerøy Vest elimination Q4 09 Q4 08 Revenues 338,0 247,4 208,0 205,6 157,9 1 156,9 836,7 EBIT before biom adj 101,0 49,2 53,2 17,4 11,9 232,7 62,9 RoS before biom adj 30 % 20 % 26 % 8%
Slide 32: Key Figures Production YTD Q4 2009
Key Figures Production YTD Q4 2009 *) *) **) Lerøy Others / Total YTD Total Figures NOKm Lerøy Midnor Hydrotech Lerøy Aurora Lerøy Vest elimination Q4 09 YTD Q4 08 Revenues 1 072,2 657,9 575,2 918,2 505,6 3 729,1 2 872,1 EBIT before biom adj 303,7 134,5 135,2 157,9 24,2 755,5 252,1 RoS before biom a
Slide 33: Key Figures Sales & Distribution Q4 2009
Key Figures Sales & Distribution Q4 2009 Sales & Total Total Figures NOKm Distribution Elimination Q4 09 Q4 08 Revenues 2 297,1 -131,7 2 165,4 1 691,9 EBIT 82,9 -0,1 82,8 53,0 RoS 3,6 % 3,8 % 3,1 % • Extremely good performance • Christmas season • High volumes • Economies of scale 33
Slide 34: Key Figures Sales & Distribution YTD Q4 2009
Key Figures Sales & Distribution YTD Q4 2009 Sales & Total Total Figures NOKm Distribution Elimination YTD Q4 09 YTD Q4 08 Revenues 7 933,8 -572,5 7 361,3 5 927,8 EBIT 216,1 0,5 216,6 128,6 RoS 2,7 % 2,9 % 2,2 % • Also an extremely good performance YTD 34
Slide 35: Norskott Havbruk
Norskott Havbruk LSG’s share = 50% NOKm Q4 2009 Q4 2008 YTD 2009 2008 Revenues 296 236 922 772 EBITDA 65 17 212 94 EBIT bef adj biom 52 10 166 58 EBIT 30 6 166 56 Pre tax 28 1 155 31 Volumes (GWTk) 8,5 6,6 26,5 22,8 EBIT/kg 6,1 1,5 6,2 2,5 Balance sheet 31.12.2009 31.12.2008 Licences, goodwill 360 3
Slide 36: Agenda
Agenda 1.1 Considerations 2.2 Key financial figures Q4 2009 3.3 Lerøy at a glance 4.4 Market glance 36
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Slide 38: Market development for Atlantic Salmon from Norway
Market development for Atlantic Salmon from Norway (ex Norway). Jan-Dec 2008 vs Jan-Dec 2009 Volume 2008 Volume 2009 Change Value 2008 Value 2009 Change EU 530 806 591 671 11,5 % 13 191 666 16 611 654 25,9 % Others 90 304 101 316 12,2 % 2 194 349 2 904 417 32,4 % Japan 24 525 29 317 19,5 % 746 451 9
Slide 39: Market development for Atlantic Salmon from Norway
Market development for Atlantic Salmon from Norway (ex Norway). Jan-Dec 2008 vs Jan-Dec 2009 "Others" Volume 2008 Volume 2009 Change Value 2008 Value 2009 Change Hongkong 12 775 15 253 19,4 % 340 831 465 766 36,7 % Ukraine 17 917 13 089 -26,9 % 271 573 241 933 -10,9 % China 7 942 10 770 35,6 % 200 0
Slide 40: NOK/kg FCA Oslo 4-5kg
NOK/kg FCA Oslo 4‐5kg 10 15 20 25 30 35 40 45 50 1997‐1 1997‐11 1997‐21 1997‐31 1997‐41 Figures as per 22.02.10 Source: FHL/NSL/NOS 1997‐51 1998‐9 1998‐19 1998‐29 1998‐39 1998‐49 1999‐6 1999‐16 1999‐26 1999‐36 1999‐46 2000‐4 2000‐14 2000‐24 2000‐34 2000‐44 2001‐2 2001‐12 2001‐22 2001‐32 2001‐42 2001
Slide 41: SPOT prices, fresh Atlantic salmon
Avrg Q4 09 NOK 27.52 vs avrg Q4 08 NOK 25.33 (+8.6%) SPOT prices, fresh Atlantic salmon, cross-section, FCA Oslo, as of week 7-2010 (Superior quality). Avrg 2009 NOK 30.58 vs avrg 2008 NOK 25.75 (+18.7%) Q1-03 Q2-03 Q3-03 Q4-03 Q1-04 Q2-04 Q3-04 Q4-04 Q1-05 Q2-05 Q3-05 Q4-05 Q1-06 Q2-06 Q3-06 Q4-06
Slide 42: Atlantic salmon – Supply
Atlantic salmon – Supply in tons WFE Change Change Change Change Change Change Change Change 2003 02-03 2004 03-04 2005 04-05 2006 05-06 2007 06-07 2008 07-08 2009 E 08-09 2010 E 09-10 Norway 508 400 14,5 % 537 000 6% 572 200 7% 598 500 5% 723 300 20,9 % 741 000 2,4 % 855 700 15,5 % 931 200 8,8 % Un
Slide 43: Drivers Salmon as per 31.12.2009
Drivers Salmon as per 31.12.2009 Norway total export volume of Atlantic Salmon (833,706 MT WFE) + 16.3 % Norway total export value of Atlantic Salmon (NOK 23,663m) + 32.1 % Norway – EU (volume Atlantic Salmon) (591,671 MT WFE) + 11.5 % Norway – EU (value Atlantic Salmon) (NOK 16,611m) + 25.9 % Norwa
Slide 44: Going forward!
Going forward! •Competent organisation •Satisfactory financing •Normal capex “as is” •Operational improvements •Good demand for seafood •Improved profitability •Continued consolidations •Create sustainable shareholder value • Annual dividend since 1995 • NOK/share 7.0 • Share liquidity • AUSS sold s
Slide 45: Thank you!
SEAFOOD INNOVATION SINCE 1899