Austevoll Seafood (Oslo:AUSS) Q1 2026 Earnings Call

0:01 It's a pleasure for me to welcome you to, Austevoll Seafood first, quarter presentation. I will start, this presentation by giving, the highlights of the quarter. Thereafter, I will take you through the different segment, and Rith Katrin Dreyvenes will take you more in detail through the numbers, and I will end this session by giving our view on the different markets we are operating in. So starting up, we have had a good first quarter with strong earnings, I would say across the different segments. When it comes to farming, we have a strong biological performance in the quarter.

0:53 We have increased the harvest volume with approximately 2,000 tons in the quarter, and we have also seen a reduction in prices in the quarter, compared with the same quarter in 2025. Looking at the white fish segment, we went into the year with considerably lower quotas, but that has been uplifted by an extremely good price achievements, which have led into a better financial result from the white fish segment in first quarter twenty twenty six.

1:40 In the pelagic segment, we also came into the year with fish meal and fish oil and frozen products on stock, with increasing prices, which is also reflected in earnings for this quarter. So all in all, we have 21% lower volumes, five and twenty eight thousand tons in the quarter, revenue of just below billion and EBITDA two percent up from last quarter last year, same quarter last year, just below billion, net interest bearing debt of NOK7.8 billion and we also proposed a dividend per share on NOK6.50.

2:32 If we include 50% of our shares in Pelagia, our EBITDA is up with 2%, NOK2.145 billion in the quarter, of which salmon white fish down by 10%, 150,000,000 weaker, mainly as a consequence of lower price achievement, and we have a 32% better contribution from the pelagic segments, mainly driven by million, better contribution from Austal in Peru and NOK175 million from FUCOP.

3:29 Would say Austevoll Seafood is all about volume and is how we are able to create value of this volume. If you look at the right hand side, you can see that we are aiming to catch between 400,000 to 500,000 tonnes on an annual basis with their own vessels on our own license. We are aiming to produce in our pelagic factories between 1.6 to 2,000,000 tonnes of raw material. We are aiming to catch and produce approximately 80,000 tons of white fish this year and the aim is also to slaughter 225,000 tons of salmon products in 2026.

4:20 So starting up on the pelagic side giving a view both on the quarter and also in the coming season. Starting up with the Peruvian Antuy, what's fair to say here is that quota was a bit lower than, what we expected, that is based on a biomass which were, I would say lower also than, in terms of what they detect in the season. Biomass of 7,000,000 tons, and the final quota was 1,900,000 tons.

5:09 And it's fair to say that the fishery has been more challenging also for the first, three weeks of the season. It started off the April 9, and I would say the short summary is that it was, too high, inclusion of undersized fish, in the catches and there has been a stop in the fishery as a consequence of that. The stop was May 1 and we are trying to delay the fishery together with the ministry in terms of, having fishing zones, where you can have larger fish or zones without juveniles.

6:08 Normally, there is juveniles in certain area, a too high incidence of juveniles. In the start of this season, this has been, I would say, the matter all over the coast and as a consequence, the fishery has now been reduced and we are aiming that the fish is growing or the small fish is segregating for the bigger fish so we are able to catch. Of course this can affect the total catches of this year's quota and has also resulted in that prices both for fish meal and fish oil has been increasing during the period.

6:59 I would say the fishmeal and fisheries in the South has been, quite good in the first quarter, with, okay oil yields and the performance there is on a normal level. Chile, as you can see, for the latest fifteen years we have been having an average increase of the quota on 12%, which has been quite good. In 2025 the increase was 22%, which also resulted in a lower increase of the 2026 quota of close to 8%.

7:49 We came into the year with stocks both for fish meal, fish oil and also for frozen products and have had a quite decent fishery in the first two months. And in March and onwards we have also seen the same as we are seeing in Peru that there has been too high inclusion of undersized fish also for the horse mackerel, which has also led into a temporary stop in Chile. And we are waiting and aiming for the conditions to change to continue the fishery there. North Atlantic quotas is down, it's marked by a blue whitening quota down with 41%, macro quota down with 48%, we have North Sea quota down with 20%, North Sea quota is up by 20% next year and I would say also this affects the volume intake for Pelagio.

9:09 And if you look at Pelagio, the quarter is a quite good quarter, also more or less in line with the same quarter last year. The contribution from the different segments is a bit different, this year versus, last year, I will come back to that later. And of course, Pelagia will, probably, have a different development in '26, which they had in '25. In '25, the quota were reduced and also fishmeal and fish oil prices were dropping during the year.

9:57 We are also seeing reduced quota for '26, but the aim is that fishmeal and fish oil prices is going in the other direction, which will benefit Pelagia. All in all, revenue of billion, EBITDA of NOK319 million, whereas NOK79 million is coming from the food segment, NOK162 million is coming from the feed segment, and approximately 77,000,000 is coming from the health segment. So all in all, I would say volume is down by 23% in the quarter for the pelagic segment but the earnings due to better price achievement is up with approximately 30% on the pelagic segments.

11:04 When it comes to salmon whitefish, I suggest that you go in looking at at Larry's presentation. Adjusted EBIT of $858,000,000 in the quarter, 5,000,555 million is coming from the farming segment, $228,000,000 coming from the wildcatch segment considerably higher than last year and 160,000 tonnes coming from VAP sales and distribution. The slaughter volume of thirty nine nine hundred tonnes in the quarter, approximately 8,000 tonnes from the North, 16,000 tonnes from mid and 16,000 tonnes from Leray Chertrol.

11:58 Spot prices is down by NOK4 per kilo and the adjusted EBIT is also down to NOK80 per kilo, with 24 EBIT per kilo in the value chain in La Reroua, NOK23 in Leray Met and approximately NOK10 in Leray Schuthol. Whitefish, again lower volumes, higher earnings and is mainly driven by price achievement up 24% on Cod, 32% on Hadoc and 54% on Seit. On And the other direction fuel cost is up as a consequence of, the war, and we are on an annual basis using approximately 38,000,000 liters of diesel, which has an effect on earnings, but all in all we are expecting a better year on, white fish in '26 versus '25.

13:08 Then I will give the floor to Britt Katrina. As normal, we start with this table and that actually sums up what An has been taking you through in his part of the presentation, so I will not comment further on that. Here you can see the key figures of the first quarter and also the changes for the different segments in first quarter this year compared with the same quarter last year. We move over to the income statement and we have an operating revenue and other income of billion and that is more or less in line with the same quarter in 2025.

14:03 EBITDA adjusted is also more or less in line, it's 2% up, close to NOK2 billion, up from NOK1.938 billion. Income from associate is down CHF9 million this quarter compared to CHF35 million in the same quarter last year. The two largest associated companies is Norscot Halberk, which owns Scottish Seafarm and Pelagia. And Pelagia, they have earnings in the first quarter this year in line with the same quarter last year, as Arne showed you in his part of the presentation. But Scottish Seafarm have a substantially lower earnings in first quarter this year compared to the same quarter last year.

14:51 And that can be explained by a 36% lower harvested volumes and lower volumes is impacted by the challenging biological situation the company had in 2025. And of course lower volume impacts cost, especially associated with well boats and processing. What I would like to mention is that the next generations are doing well in the Scottish Seafarm. And that gives us an EBIT, including income from associates of 400,000,000, down 1% from $140,000,000,029,000,000 in same quarter last year.

15:37 I have to mention this fair value adjustment related to biological assets. This is an accounting principle and does not have any cash effect. In first quarter this year, that was minus million, but first quarter last year it was substantially higher, it was minus NOK 1,800,000,000 and of course impact operating profit. So first quarter last year we had a negative operating profit of minus NOK $464,000,000 and in first quarter this year we have a positive operating profit of just above 1,000,000,000. Net profit in the period is $644,000,000, which gives earnings per share of NOK 2.5.

16:26 In first quarter last year, we had a negative net profit of minus NOK 195 and then earnings per share to the shareholders of Austevoll of NOK 0.10. Looking into Lerais Seafood Group, the main value drivers here are of course the slaughtered volumes of salmon and trout. They had slaughtered volumes of close to 40,000 tons, up 4% from same quarter last year. Price achievement has however declined. The spot prices are down 4 NOK 4 per kilo and we have higher average slaughter weights, but we have not had the same premium on the price for the larger fish in first quarter this year compared to what we had in first quarter last year.

17:24 As expected, there is a quarter on quarter cost increase and that is attributed to the lower volume from Neria Ord. They had a quite substantial volume in fourth quarter. And there is continued strong biology in the farming segment in Leroy. Wild catch have had a very strong performance in first quarter, especially considering the quota. Catch volumes are down, but prices are significantly up. And we also see a clear operational and financial improvement in the land based industry. However, this is still challenging for the land based industry with lower raw material available and also high raw material prices.

18:11 LAP sales and distribution have continued growth in volumes and revenue. However, we see some negative impacts this quarter on gross margins in some units and increased logistics costs related to logistics are also giving pressure on margins to some high margin markets. Revenue in the quarter was close to 8,100,000,000 and the EBIT was $858,000,000, down from a little bit above NOK 1,000,000,000 in same quarter last year. As normal, we have had lower activity in Peru.

18:57 The second season twenty twenty five finished in January and Ostral got 20,600 tons in January related to this season versus 35,500 tons in first quarter twenty twenty five related to second season in 2024. The season in the South started in January and Aristotle has purchased a little bit above 52,000 tons, which are produced for fishmeal and fish oil at the Ilo plant. In first quarter last year, they purchased 60,000 tons. Sales volumes are down but prices are up for fish meal up 37% and for fish meal up 11%.

19:45 So revenue in first quarter was NOK962 million and EBIT NOK218 million, up from NOK126 million in same quarter last year. And you can see we have also had an increase in the EBIT margin, which was 23% in first quarter this year versus 11% in same quarter last year. Food Corp had good activity in the quarter, very high activity in January and February, but reduced catch rates in March, which Arne explained also when he was talking about Food Corp earlier. We had an own catch of mackerel horse mackerel of 38,500 tons, down from 54,700 tons in Q1 this year.

20:37 We have also purchased 16,000 tons from third party or the coastal fleet of sardine and anchovy and that is down from 27,000 tons in the same quarter last year. But the reduced volume is mainly due to one month earlier start of the season in 2025. We see that we have higher yields from this raw material in 2026 versus 2025. We have a substantially higher volume of frozen products and we have increased the yields for frozen production and the price achievements are also up year on year.

21:23 Revenue in first quarter was NOK $628,000,000, up from NOK $425,000,000 and the EBIT adjusted was $288,000,000, up from 115,000,000. And you can see that our EBIT margin is substantially up 46% versus 27%. I would like to mention that we are guiding on a total raw material of 135,000 tons and Food Corp's own quota is 70,000 tons. So we purchase some raw material from a third party which we catch with our own vessels. So in first quarter, the production is from our own quota. Cobbe Vikofurholmen, that is a small farmer on the West Coast Of Norway.

22:16 We have harvested a little bit above 2,300 tons, which is up 24% versus the same quarter last year. They sell all their salmon in the spot market and as I mentioned earlier, is a reduction in prices year on year on salmon. But we have had significantly lower cost on this volume than we had on the harvested volume in same quarter in 2025. So the EBIT per kilo here is NOK 23 down from NOK 27. Total revenue in the quarter is NOK $212,000,000 and EBIT adjusted is 54,000,000, more or less in line with EBIT in the same period last year.

23:10 The total assets for the group by the end of March is 52,400,000,000, that is down from 53,000,000,000 in the end of March twenty twenty five and also 53,000,000 by the end of last year. The net interest bearing debt is 7,900,000,000, it's a little bit up from March in 2025, but down from 8,700,000,000 by the end of twenty twenty five. Equity ratio at 54%, 1% down from March last year, but up from 52% by the end of twenty twenty five. We have some units with different functional currency and of course when we do the exchange into Norwegian krone in the balance sheet that will of course be impacted by the strengthening NOK. So that explains some of the reduction in the total balance sheet.

24:15 Looking at the cash flow, there has been a good cash generation in first quarter, so cash from operation is a little bit above 1,400,000,000. Cash from investing activity is minus $268,000,000. CapEx is not like the same every quarter. So it's quite low in first quarter and we know that LRE has a CapEx program of 1,700,000,000 in 2026 and the other segments are more or less in line with their normal depreciations. So this will be higher as we go further in 2026. Cash from financing activity is minus $891,000,000 and this gives us a net positive change in cash of NOK $261,000,000 and we end the quarter with a cash position of close to 5,400,000,000.

25:24 Then I will give the view on the different markets we are operating within, starting up with the fishmeal market and the fishmeal producer. If you look at the largest fish meat producers you can see that, as of week 17, the production is down by 24%, and we also know that the quota in Peru is down by 36% and of course there's also uncertainties in terms of if the quota will be caught going forward. And that has led into an increase of prices and in Peru no prices is close to $2,600 per ton on super prime with a discount of $200 down to $50 down to lower quality fish meal.

26:22 I would say these prices will come into third quarter, the demand is from third quarter onwards and there still is China which is the main market for fish meal. If we look at the Chinese market stock is down by 44% compared with the same week in 2025 and you also see that weekly offtake is a bit lower than it was the same period last year. Prices are a bit higher than the Peru prices, which also stimulates trade.

27:09 We also see that import in China is down by 12% in first quarter and Peru is 46% of that import. Fish oil, I would say, is less down, but down by 7%. It's also fair to say that Peru, due to the inclusion of juvenile fish, we also see that the oil yields are lower than the normal yields we are seeing in this season, so just under 2%. We also see that fish oil prices have increased during the quarter, and I know approximately $4,100 per tonne, and it's a premium of 300 to $400 per tonne on omega-three grade.

28:12 Then looking at Salmon, as you see in 2025, we had an increase of volume out of Norway and worldwide of approximately 12% This year, out of Norway, it's an expectation of just over 2% increase. And it's also, I would say that so far this year we have been slaughtered 30,000 tons more in Norway compared with the same period last year. And going forward, we are expecting the same growth that we had in 2025. So I would say the growth is already taken out according to Kuntali.

29:01 So the underlying growth both in '26, '27 obviously is giving a tight supply situation. Prices is I would say down versus same quarter last year and also starting up in second quarter this year, prices is a bit lower than we expected in the beginning of year and it's mainly explained by strengthening of NOK and also we have seen increasing logistics costs, particularly on the Asian market as a consequence of increasing fuel prices.

29:54 Consumption has been very good, an increase in the EU market up by 12% and where you see the most increase is in the other markets mainly driven by Asia and China, where we have had an increase of 28% versus the same period last year. Summing up, I would say we have had a strong biological performance in Leri, coelace treatment is down, mortality is down. We are expecting a harvest volume of 195,000 tonnes in 2026, and we have also started this cost reduction program, which will gradually impact the cost during 2026 but also into 2027.

30:50 Whitefish price development outweighs lower catch volumes. We are seeing significantly higher fuel prices going in in second quarter, but all in all I would say that we are expecting a better year in whitefish segment for '26 versus '25. Up sales in distribution, I would say lower salmon and choke prices are building markets, it's still strong demand, strict supply growth, but we're also seeing that higher logistic costs and reduced accessibility to certain high margin markets and particularly in Asia is taking a bit prices down and the strengthening of NOK is also affecting the profitability.

31:44 In Peru, as I said, a challenging start of the season. Quora has put on 1,900,000 ton. At the time being there is a stop in fishery in order to see if the mix between juveniles and larger sized fish will change. And of course, if this will happen for a longer period it will affect how much of the quota we are able to catch in the end. Same situation in Chile, we had a good start January and February and, from March and onwards it's been also a mix of undersized fish, meaning that it's been stop in the fishery.

32:37 The fleet now is searching for other fishing zones to see if they find areas and fishing zones, which holds a better mix of fish sizes. So that was all. When it comes to the North Atlantic, again an okay start of the season and we are also seeing that the situation in Peru is going to increase prices also for activity in Pelagia. So that was all. Thank you, and have a good day.