challenges and opportunities in aquaculture technology...
TRANSCRIPT
Your Aquaculture Technology and Service Partner
Challenges and opportunities in aquaculture technology export Hallvard Muri – CEO
Intrafish Seafood Investor Forum, New York, May 23rd, 2017
Your Aquaculture Technology and Service Partner
Your Aquaculture Technology and Service Partner
• Leading technology and service partner to the global aquaculture industry
• Global presence and subsidiary in 10 countries
• Deliveries to over 65 countries during the last 40 years
• 842 employees
• 2016 revenues of 1 603 MNOK
• Listed on Oslo Stock Exchange since 2006
• Market cap of ~1 787 MNOK
AKVA group in brief
Your Aquaculture Technology and Service Partner
Cage Based Technology
Plastic Cages
Steel Cages
Feed Barges
Feed Systems
Mooring Systems
Nets
Camera Systems
Underwater Lights
ROV Net Cleaner
Environmental Sensors
Mort Collector
Work Boats
AKVAconnectControl Software
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Land Based Technology
Fish Tanks
RAS (Recirculation Aquaculture Systems)
Central Feed System
Biofilter Oxygen Cones
Nitrogen De-Gasser
Particle Filter
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Software
Fishtalk
AKVAconnect
Support
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Financial figuresOrder intake
0
200
400
600
800
1 000
1 200
1 400
1 600
1 800
2 000
2 200
1 617
273
1 952
2016
182
196
1 574
2015
1 570
215
198
1 158
2017 Q1 LTM
2 100
210
Nordic ExportAmericas
10,7%
9,5%
0
200
400
600
800
1 000
1 200
1 400
1 600
1 800
0%
5%
10%
15%
20%
972
258
195 194
2017* Q1 LTM
1 721
1 603
186
181
170
1 341
1 251
2015
10,6%*
1 425
2016*
EBITDA %
Nordic
Americas
Export
*Excluding one off in 2016
Order backlog
0
100
200
300
400
500
600
700
800
900
1 000
1 100
1 200
649
97
27
525
2017 Q1 LTM
1 077
128
119
830
2016
998
97
52
848
2015
AmericasNordic Export
Revenues (MNOK) and EBITDA (%)
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Where do we deliver?
Income distribution 2017 Q1 LTMAKVA group’s geographical regions
78%
11%
11%
Export
Nordic
Americas
Nordic
Americas
Export
AKVA group
Agents and Distributors
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Export in AKVA group
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Export in AKVA group Approx. 90% of sales to the salmon sector… ...however, salmon only accounts for 4% of the
global aquaculture production
10%
90% Salmon
Other species96%
4%
Salmon
Other species
….no question a potential but we are faced with several challenges in immature markets
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Tilapia farm in Lake Victoria, Uganda
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Tilapia juvenile pond farm in Uganda
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Pangasius farming in ponds in Vietnam (Mekong Delta)
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Fish farms in China – 40.000 cages in one area…
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Fish farms in China – 40.000 cages in one area…
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CHALLENGES
Export in AKVA group
Your Aquaculture Technology and Service Partner
Challenges in immature export markets
Lack of fish farming competence
Lack of project completion capacity
Unpredictable and undeveloped markets
Political and legal risks
Corruption, reputation and corporate governance risks
Health, safety and environment (HSE)
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Challenges in immature export markets
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Challenges in immature export markets
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OPPORTUNITIES
Export in AKVA group
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Opportunities - key success factors
Key success factors
Persian Gulf, Iran
Focus on clusters, key customers and large projects
Legal contracts, trade and finance competence
What NOT to do
Offer experienced farm management
HSE, Code of Conduct and Anti-corruption program
Require site surveys
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AKVA’s top prioritized clusters outside of salmon
AKVA group’s geographical regions
Nordic
Americas
Export
AKVA group
Agents and Distributors
PRIORITY area
MEDITERRANEAN(Subsidiaries in Turkey and Spain,
agents in Greece and North Africa)
PRIORITY area
IRAN(Establish subsidiary in 2017
as hub for Middle East market)
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Priority area - Mediterranean
Mediterranean market Prioritised countries in the region
60% 40%
Sea BassSea Bream
MAIN SPECIES
Established a hub for western Mediterranean in
2017Expanding operations
Expanding operations
Following development in North Africa, Croatia and Italy
• Turkey is leading the development – Adopting the «salmon model»
– Bigger farms
– Scale of economy
– Better equipment
– Further offshore
• Mediterranean countries following Turkey
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Priority area - Mediterranean
Sea Bass and Sea Bream (1000 tons of production)
Historical and future volumes
Sea Bass and Sea Bream prices in Greece (€/kg)
Average annual price development
116 113 110 101 112 118 125
104 100 90 110120
130140
0
50
100
150
200
250
300
2015
248265
2016E
200
2014 2019E2017E
211
2018E
232213220
2013
GreeceTurkeySource: FGM, FEAP, AKVA group
0
2
4
6
2010 2011 2012 2013 2014 2015 2016
Sea Bass
Sea Bream
Source: FMG, Kontali
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Opportunities - key success factors
Sea Bass and Sea Bream farm in Turkey
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Opportunities - key success factors
Sea Bass and Sea Bream farm in Croatia
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• Developing industrial scale fish farming is top government priority
‒ Adopting the «salmon model»‒ Bigger farms‒ Scale of economy
‒ Better equipment‒ RAS Land Based juvenile farms
• AKVA group Middle East LLC will be established in Iran in 2017
Priority area - Iran
Iranian market
AKVA cage farm No. 3
AKVA cage farm No. 2
AKVA cage farm No. 1
AKVA cage farm No. 4
AKVA land based farm No. 2
AKVA land based farm No. 1
Trout
Barramundi & Sea Bream
AKVA group Middle East LLC to be established
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• Iranian coast of Persian Gulf has ideal farming conditions for Barramundi and Sea Bream‒ 20-35°C year round water temperatures‒ Good water quality, current and oxygen
• Iranian government targets 200,000 tons production in cages by 2020‒ Seems a bit optimistic short term, but direction is clear‒ Possibly 1500-2000 MNOK in AKVA sales of cage
technology alone
• Land based juvenile facilities based on RAS, work boats and other required equipment in addition
Iranian market
Priority area - Iran
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Opportunities - key success factors
3000t Barramundi and Sea Bream farm in Persian Gulf, Iran
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Opportunities - key success factors
Installing cages in Persian Gulf, IranBarramundi farm in hydro dam near Bushehr, Persian Gulf, Iran
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AKVA’s way forward in the export market
Expand our business in established and growing clusters
Focus first on «closer to home» markets with proven concepts
Target customers with ability to invest in and operate large scale farms professionally
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