Q3 2017 Presentation - Investor Relationsir.akvagroup.com/investor relations/financial info... ·...
Transcript of Q3 2017 Presentation - Investor Relationsir.akvagroup.com/investor relations/financial info... ·...
Q3 2017 PresentationOslo – November 3rd 2017Hallvard Muri, CEOSimon Nyquist Martinsen, CFO
Highlights
Financial performance
Outlook
Q&A
Agenda
Highlights Q3 2017 – by CEO Hallvard Muri
• Overall increase in order intake of 31% compared to Q3 2016
• Strong order intake in Europe & Middle East with an order intake of 114 MNOK in the quarter
• Americas continue the good development with a strong order intake of 91 MNOK in Q3 2017 (almost three times the order intake in Q3 2016)
• In the Land Based segment the order intake in the quarter ends on 92 MNOK, up from 57 MNOK in Q3 2016
• YTD order intake of 1.9 BNOK (full year 2016 of 1,95 BNOK)
Order intake
Continued strong growth
254 296 252328
420 435 427 421
63101
250
72103
303
9244
6951
48
5733350
589
3331
1Q17
441
778
SW
CBT
4Q15
LBT
3Q174Q161Q16 3Q16
41732
2Q16
533
+31%
546
2Q17
561
• 37 % increase in revenue compared to Q3 2016
• Strong market in the Nordic region is a contributor to a 31% increase in revenue in Nordic YoY
• Strong quarter in Americas, revenue more than doubled from Q3 2016
• Land Based is gradually starting to deliver on the higher order backlog
Delivering on a strong order backlog
344393 408
354
449510 537
484
4Q163Q162Q161Q16
+37%
2Q171Q174Q15 3Q17
Revenue
• EBITDA increase of 60% compared to Q3 2016
• EBITDA margin of 12,6 %, up from 10,8 % in Q3 2016
• Strong quarter in the Nordic region, with ASA Nordic and AKVA Marine Services as the main contributors. EBITDA doubled in the region from last year
• The Land Based segment ends the quarter with an EBITDA of 7,6 MNOK (9.1 % EBITDA margin)
• Americas (AKVA group Chile, North America and Australasia) with an improvement of 10,5 MNOK in EBITDA compared to last year
EBITDA margin stabilize on a higher level
2740 43 38
24
5465 61
+60%
2Q171Q174Q163Q162Q161Q164Q15 3Q17
EBITDA
• Third quarter 2017 – Highlights
– Strong sales and order intake
– Order backlog end of September of 1.38 BNOK
– EBITDA of 61 MNOK in the quarter
– Dividend of 0.75 NOK per share paid out in September 2017
Ninth quarter in a row with growth in order backlog
385 414 385 468586 647 698 751
264 283 437417
412430
620 629
1Q16
697
4Q15
649
2Q16
822
1Q17
1 077
4Q16
998
+56%
2Q17
1 318
886
3Q17
1 380
3Q16Land Based
Order backlog
Income distribution Q3 2017AKVA group’s geographical regions
Where do we deliver
Nordic
AmericasExport
AKVA groupAgents and Distributors
21%(12%)
65%(75%)
14%(13%)
Nordic
AmericasExport
• Growing revenue in the Marine Service business in Norway is contributing to the positive development over Q2
• The Marine Service business in Chile has started and business plans is under development to grow this segment
• Continued good development for the rental business in Scotland in 2017
• Marketing and sales activity slowly starting to yield effect for Software segment
• MNOK 32 (30%) absolute increase in revenue compared to Q3 LY
Development in OPEX based revenue
140146119127
10810190 91
0
50
100
150
0
5
10
15
20
25
30
35
29,0%
2Q17
23,4%
27,1%
4Q16
30,6%
2Q16
28,3%
3Q16 3Q17
24,7%
1Q16
23,3%
4Q15
26,0%
1Q17
% of total revenue OPEX Based revenue
Revenue by product group and speciesBy product groups – Q3 2017 By species – Q3 2017
Cage Based Tech
S&AS Cage Based
53,8%(47,9%)
S&AS Land Based
21,1%(21,2%)
0,1%(0,2%)
7,8%(9,3%)
Land Based Tech
17,2%(21,5%)
Software
Cage Based technologies = Cages, barges, feed systems and other operational systems for cage based aquacultureS&AS Cage Based = Service and after sales for cage based aquacultureSoftware = Software and software systems Land Based technologies = Recirculation systems and technologies for land based aquacultureS&AS Land Based = Service and after sales for land based aquaculture
Salmon = Revenue from technology and services sold to production of salmonOther species = Revenue from technology and services sold to production of other species than salmon Non Seafood = Revenue from technology and services sold to non seafood customers
Non Seafood
7,6%(11,2%)
Other species 9,5%(14,4%)
Salmon
82,8%(74,4%)
• Continued positive market development in Chile
• Stepping up activity and presence on the Canadian east coast
• New office in Spain developing well and established office in Greece to further focus on the Mediterranean market
• Continued good performance in Norway
• Land Based project pipeline in Norway strong, focus on post smolt. Early indications market in Chile is picking up
• Investing in new extruder capacity at Helgeland Plast
• Focus on sourcing, supply chain and manufacturing efficiency
• Group strategy process ongoing, to be operationalized by end of Q4 - from “AKVA group of companies to AKVA group”
• Atlantis – dialogue with the Ministry in the quarter, decision still not made
Q3 – Operational Highlights
Underwater feeding
Fish health operations
Daily operations (dead fish removal, surveillance, cleaning, etc)
Risk management
Submerge and raise the cage – safe and remote
Air to the salmonArtificial air space
1. Atlantis Subsea Farming AS applied for 6 development licenses the 29th of January 2016
2. The Norwegian Directorate of Fisheries have informed the company that the company’s concept has progressed another step further in the process to get awarded development licenses.
3. The Directorate will go ahead with processing the application limited to 2 licenses, but have rejected the application in terms of the other 4 permits applied for.
4. On May 9th 2017 the company appealed the decision of rejecting the 4 permits.5. On June 16th 2017 the Directorate forwarded the appeal to the Norwegian Ministry of
Trade, Industry and Fisheries, for their final decision.
Financial performance Q3 2017 – by CFO Simon Nyquist Martinsen
• 37 % growth, strong contributions from Nordic and Americas
• Last twelve months order intake and sales now at 2,474 MNOK and 1,980 MNOK respectively
• The order book has grown to 1,380 MNOK at the end of Q3, which is 494 MNOK higher than at the end of Q3 2016
Revenue
Q3 2017 – Financial highlights
305330
301310344355
402
325
449
354
408393
537510
484
Q2Q1 Q4Q3
201720152014 2016
• A very strong quarter for AKVA Marine Services, ending the quarter with an EBITDA of 12 MNOK
• All entities in the Nordic region is performing above last year
• The entities in the Americas region has a very strong quarter compared to Q3 2016
• The margins in the Land Based segment is increasing quarterly, with strong underlying performance from Aquatec Solutions
EBITDA (MNOK)
Q3 2017 – Financial highlights
13
3424
32 274141
27 24384340
6554
61
0
20
40
60
80
Q1 Q4Q2 Q3
20162015 20172014
0
5
10
15
Q4
5,3%7,9%
4,4%
Q3
10,8%11,4%
10,4%
Q2
12,1%10,4%10,2%
8,0%
Q1
10,6%10,1%
8,2%10,2% 12,6%
EBITDA %
Nordic• All entities contributing positively YoY
• Very strong quarter for AKVA Marine Services
• Revenue up 31% compared to Q3 2016
Americas• Another strong quarter in Chile, improving the EBITDA
with 7.3 MNOK YoY
• The operation in North America and Australasia is ending the quarter with an EBITDA of 3.6 MNOK, compared to 0.3 MNOK last year
Export• UK ended another strong quarter with an EBITDA of 4,7
MNOK, an increase from 3.3 MNOK last year
• Turkey and Spain delivers according to plan in the quarter
• Export to emerging markets – minor deliveries in the quarter. Sold to barges to Russia in the quarter, increasing the order backlog
Cage Based Technologies
167224
36
42
93
46
0
50
100
150
200
250
300
350
400
0
2
4
6
8
10
12
14
2017 Q3
363 12,6%
2016 Q3
245
10,4%
NordicAmericasExportEBITDA %
Revenue and EBITDA %
• Good underlying performance in Aquatec Solutions and Plastsveis in the quarter with a total EBITDA of 6.4 MNOK
• Cost reductions in AKVA group Denmark starting to give effect, ending the quarter with positive figures
• Order intake of 92.1 MNOK in the quarter resulting in an order backlog of 629 MNOK in the segment end of Q3 2017
Land Based Technologies
7683
25303540455055606570758085
0
2
4
6
8
10
2017 Q3
841
9,1%
2016 Q3
770
6,3%
EBITDA % Americas Nordic
Revenue and EBITDA %
• AKVA group Software ends the quarter with an EBITDA of 4.2 MNOK
• All entities with stronger margins in the third quarter, compared to both Q1 and Q2
• We are currently carrying out a strategic evaluation of Wise ehfin order to realize the potential of the business going forward
Software
2934
4
3
0
5
10
15
20
25
30
35
40
-20
-10
0
10
20
301
19,9%
2016 Q3
331
24,3%38
2017 Q3EBITDA % Export Americas Nordic
Revenue and EBITDA %
(MNOK) 2017 2016 2017 2016 2016Q3 Q3 YTD YTD Total
Order backlog 1 379,9 885,6 1 379,9 885,6 997,7 Order intake 546,0 417,4 1 913,5 1 391,2 1 952,0 P&LOPERATING REVENUES 483,9 353,8 1 531,3 1 154,5 1 603,1 Operating costs ex depreciations 423,1 315,5 1 351,4 1 034,0 1 458,9 EBITDA 60,8 38,3 180,0 120,5 144,2 Depreciation and amortization 20,1 17,5 61,5 48,8 69,2 EBIT 40,7 20,8 118,5 71,7 75,0 Net interest expense -3,2 -1,0 -9,2 -4,9 -6,6 Other financial items -2,9 -3,6 -7,0 -15,0 -19,8 Net financial items -6,0 -4,5 -16,3 -19,9 -26,4 EBT 34,7 16,2 102,2 51,8 48,6 Taxes 8,4 5,5 29,5 16,0 21,0 NET PROFIT 26,2 10,8 72,8 35,7 27,6
Net profit (loss) attributable to:Non-controlling interests 0,2 1,4 0,3 0,3 0,1 Equity holders of AKVA group ASA 26,0 9,4 72,4 35,4 27,5
Revenue growth 36,8 % -0,3 % 32,6 % 6,8 % 12,5 %EBITDA margin 12,6 % 10,8 % 11,8 % 10,4 % 9,0 %EPS (NOK) 1,01 0,36 2,80 1,37 1,06
Financials – Detailed P&L• Whereof Land Based is 629 MNOK
• Increased depreciation mainly due to increased rental CAPEX, investments in AKVA Marine Services and amortization
• Increased due to higher net debt
• 3.2 MNOK relates to investment in Atlantis Subsea Farming AS
• Minority shareholders (49%) in Wise Blue AS
Group financial profile – remains strong
226
160
230203
165
256
180197 206
4Q163Q162Q161Q164Q153Q15 3Q171Q17 2Q17
Available cash
Including 83 MNOK of a 90 MNOK credit facility in Danske Bank, as of Q3 2017
Refinancing of long term loans, increased credit facility and established a revolving credit is finalized in October. Securing around 246 MNOK in additional available cash. E.g. cash reserve is close to 450 MNOK.
Working capital Average working capital
122124131
109
64
126127118
0
20
40
60
80
100
120
140
0
1
2
3
4
5
6
7
8
9
10
2Q17
6,7%
1Q17
6,8%
4Q16
2,2%
3Q15
8,8%
4Q15
6,2%
4,3%
1Q16
7,5%
2Q16
8,8%
3Q16 3Q17
9,1%
36
The graph shows absolute working capital and working capital relative to last twelve months revenue
Continued strong capital discipline in the Group
10010298
85
107106
0
50
100
150
0
1
2
3
4
5
6
7
8
9
10
2Q17
5,5%
1Q17
5,7%
4Q16
5,3%
3Q16
7,2%
2Q16
7,1%
1Q16
115
7,7%
4Q15
134
9,4%
3Q15
134
9,6%
5,0%
3Q17
The graph shows 12 months average working capital and average working capital relative to last twelve months revenue
Continued positive relative working capital development
CAPEX
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10 000
20 000
30 000
40 000
50 000
60 000
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2
4
6
8
10
12
4Q 20161Q 20163Q 2015 4Q 2015
32 853
6,9%
5,5%
31 666
5,9%
1Q 2017
23 114
3Q 2016
24 728
9,5%
2Q 2016
4,5%
5,9%57 368
17 06715 87124 407
4,2%
11,2%
(TNOK)
3Q 20172Q 2017
19 495
4,0%
CAPEX/Sales % CAPEX
Ordinary
12 177Intangible
21 089
Rental
75 263
CAPEX breakdown YTD 2017CAPEX and CAPEX/Sales %
Net debt/EBITDA of 1.4
Net debt (MNOK) and net debt/EBITDA
279
298310
212
71
13698
1,4
2,0
1,4
0
100
200
300
400
0,35
0,70
1,05
1,40
1,75
2,10
4Q15
1,0
3Q15
0,8
2Q17
1,6
1Q17 3Q174Q16
1,5
3Q16
213
2Q16
172
1,1
1Q16
0,5
NIBD/EBITDA (12 mth rolling) NIBD
Change in net debt (TNOK)Net debt 30.06.2017 298 368
EBITDA -60 804 Income taxes paid 1 125 Net interest paid 3 151 Capex 19 495 Acquisitions / Divestments - Long-term financial assets - Paid dividend 19 354 Buyback own shares -5 473 Sale of fixed assets - Currency effects 5 096 Other changes in working capital -1 550 Net change -19 605
Net debt 30.09.2017 278 762
Group financial profile – remains strong, continued
Equity and Equity / Total Balance NIBD / Equity
476473446435435428
0
50100
150
200250
300
350
400450
500
0
5
10
15
20
25
30
35
40
29,4%
1Q17
31,3%
4Q16
31,6%
3Q16
37,1%
2Q16
460
4Q15
38,9%
3Q17
39,6% 31,4%38,0%
2Q171Q16
443
3Q15
38,9% 4370,59
0,630,70
0,490,49
0,37
0,16
0,32
0,22
0,0
0,1
0,2
0,3
0,4
0,5
0,6
0,7
3Q15 2Q171Q174Q163Q162Q161Q164Q15 3Q17
Group financial profile – remains strong, continued
ROCE ROACE
13,5%
2Q174Q16
9,8%
3Q163Q15
13,9%
3Q17
11,1%
1Q17
9,6%
17,8%
4Q15
14,7%12,4%
2Q16
14,0%
1Q16 2Q17
12,7%
1Q17
10,9%
4Q16
11,4%
3Q163Q15
15,0%
3Q17
14,6%13,2%
2Q16
15,1%
1Q16
18,6%
4Q15
16,1%
Cash flow statement
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW Note 2017 2016 2017 2016 2016(NOK 1 000) Q3 Q3 YTD YTD Total
Net cash f low from operations 54 275 33 221 159 382 93 664 105 596 Net cash f low from change in w orking capital 1 550 -25 355 -80 277 10 404 106 050 Net cash f low from operational activities 55 825 7 866 79 105 104 067 211 645 Net cash f low from investment activities 1,3 -21 585 -17 271 -74 688 -136 999 -260 324 Net cash f low from financial activities -20 998 -13 646 -46 325 53 576 105 646
Net change in cash and cash equivalents 13 241 -23 051 -41 908 20 645 56 967 Net foreign exchange differences -2 648 -2 412 -404 -3 974 -941 Cash and cash equivalents at the beginning of the period 112 638 151 651 165 543 109 517 109 517 Cash and cash equivalents at the end of the period 123 232 126 187 123 232 126 187 165 543
Balance sheetBALANCE SHEET 2017 2016 2016
(MNOK) 30.09 30.09 31.12
ASSETS 1 521 1 179 1 376 Intangible non-current assets 578 411 575 Tangible non-current assets 197 138 151 Financial non-current assets 10 5 6 Inventory 223 178 186 Receivables 389 321 292 Cash and cash equivalents 123 126 166
LIABILITIES AND EQUITY 1 521 1 179 1 376 Equity 476 427 435 Minority interest 1 11 0 Long-term interest bearing debt 358 265 348 Short-term interest bearing debt 44 75 30 Non-interest bearing liabilities 642 402 563
Largest shareholders20 largest shareholders
Origin of shareholders, 5 largest countries
Share developmentNo of shares % Account name Type Citizenship
13 203 105 51,1 % EGERSUND GROUP AS NOR3 900 000 15,1 % WHEATSHEAF INVESTMENT GBR1 139 565 4,4 % VERDIPAPIRFONDET ALFRED BERG NOR
470 246 1,8 % EIKA NORGE NOR460 414 1,8 % VPF NORDEA KAPITAL NOR459 942 1,8 % STATOIL PENSJON NOR381 300 1,5 % MP PENSJON PK NOR367 623 1,4 % VPF NORDEA AVKASTNING NOR300 000 1,2 % MERTOUN CAPITAL AS NOR300 000 1,2 % NORDEA NORDIC SMALL FIN257 444 1,0 % NORDEA 1 SICAV LUX257 388 1,0 % VERDIPAPIRFONDET DNB NOR198 315 0,8 % VERDIPAPIRFONDET NOR NOR188 625 0,7 % OLE MOLAUG EIENDOM A NOR164 455 0,6 % ARCTIC FUNDS PLC IRL157 156 0,6 % SIX SIS AG Nominee CHE155 700 0,6 % FORTE TRØNDER NOR150 000 0,6 % DAHLE BJØRN NOR145 653 0,6 % ROGALAND SJØ AS NOR121 900 0,5 % METZLER EURO SMALL + IRL
22 778 831 88,2 % 20 largest shareholders3 055 472 11,8 % Other
25 834 303 100,0 % Total number of shares as per 30.09.2017
No of shares % Origin No of shareholders20 214 827 78,2 % Norway 973
3 954 198 15,3 % Great Bri ta in 19403 978 1,6 % Luxembourg 6342 207 1,3 % Ireland 5326 945 1,3 % Finland 4592 148 2,3 % Other 109
Total number of shareholders: 1116 - from 25 different countries
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Outlook – by CEO Hallvard Muri
AKVA group in brief
Leading technology and service partner
Listed on Oslo stock exchange since 2006
Deliveries in 65 countries over 40 years
Companies in 11 countries. 927 employees
Turn-key solutionsCage Based Technology Land Based Technology Software
OPEX Based Revenue
CAPEX Based Revenue
Order backlog and inflow, 2014 through 2017
346454414647
403376385
698
293357468751
411385586
10693 283
430
118
437
620
286
417
629
93 264
412
494
Q2
822
1 318
56349
643
47875
1 077
697
Q4
547452
Q3
886
649504
1 380
998
Q1
231332 340
486321 268 283
475
185290 360
454371
287
489
101
103
80
250
304
214 57
9289
63
72
327
460
6
546
12243
36368
Q1
441
589
348
Q2
417
533
778
16201
504561
Q4
350
Q3OtherLand Based
Order backlog Order intake
Strong order backlog, 1,380 MNOK
46% of total order backlog relates to Land Based Technology (LBT)
High market activity and order intake of 546 MNOK
Outlook – AKVA group• Underlying market assumptions continue to be strong
• Customers are increasing investments in Land Based
and post smolt
• The Atlantis project is still at the Ministry for final
decision
• Strategy process to be concluded in Q4
• Continued focus on internal improvements