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1. Opening of the annual general meeting by the Chairman of the Board and registration of shareholders present
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2. Election of chair of the meeting and a person to co-sign the minutes along with the meeting chair
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4. Ordinary agenda items
4.1. Presentation of business activities by Group chief executive Trond Williksen
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Presentation of Business Activities
Annual General MeetingBryne, 10 May 2016
Trond Williksen, CEO
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Highlights 2015
2015 has been the best year ever for AKVA group
Years of effort from many employees to make the Group more streamlined and efficient is shining through in our results
A broader mix of product and services contributing to revenues in 2015 compared to earlier years – becoming a stronger and more diversified AKVA group
We look to the future with more confidence knowing AKVA group is stronger and able to take the next steps
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-10
103135
2010 2011 2012 2013 2014 2015
MN
OK
EBITDA
743
1 2461 425
2010 2011 2012 2013 2014 2015
MN
OK
Revenue
Building a stronger AKVA - step by step
8
+14%
+31%
Your Aquaculture Technology and Service Partner
504
649
4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15
MN
OK
Order Backlog
Best order backlog ever – higher degree of LBT and OPEX based revenue
9
+152% +29%
505
Good market activity and sales so far in the new year
460
350
4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15
MN
OK
Order Inflow
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106 126 127 126
11,6 %
10,1 %
9,1 % 8,8 %
0 %
2 %
4 %
6 %
8 %
10 %
12 %
14 %
0
20
40
60
80
100
120
140
160
4Q
13
1Q
14
2Q
14
3Q
14
4Q
14
1Q
15
2Q
15
3Q
15
4Q
15
MN
OK
MNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOKMNOK
MNOK
96
153 144
183
144 147 157
226
160
4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15
MN
OK
Group financial profile – remains strong
Available cash Working capital
+16 MNOK
Continued strong working capital level – despite record high activity
Due to strong capital discipline
Including a 90 MNOK credit facility in Danske Bank
Cash in Q3 2015 includes the financing of the adjustment amount in the Aquatec Solution acquisition
Your Aquaculture Technology and Service Partner
339 347 365 375 389 403 417 443 428
46,9 %43,1 %
40,0 %
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
0
50
100
150
200
250
300
350
400
450
500
4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15
MN
OK
Total Equity Equity %
Group financial profile – remains strong, continued
11
ROCE Equity
Good nominal increase in equity YoY due to profitable operation
Dividend payments of 25.7 MNOK in Q4 2015 and 25.8 MNOK in Q4 2014
+39 MNOK
3,3 %
8,4 % 8,3 %
15,2 % 14,1 %
12,3 %
15,2 %
13,9 %
15,0 %
Q4 - 2013 Q1 - 2014 Q2 - 2014 Q3 - 2014 Q4 - 2014 Q1 - 2015 Q2 - 2015 Q3 - 2015 Q4 - 2015
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Net debt/EBITDA of 1.0x
12
Net debt (MNOK) and net debt/EBITDA
75
70
92
44
89 82
76
98
136
1,6
1,0
1,3
0,4
0,9 0,8
0,7
0,8
1,0
-
1,0
2,0
-
30
60
90
120
150
Q4 - 2013 Q1 - 2014 Q2 - 2014 Q3 - 2014 Q4 - 2014 Q1 - 2015 Q2 - 2015 Q3 - 2015 Q4 - 2015
Net interest bearing debt NIBD/EBITDA(12months rolling)
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AKVA group – uniquely positioned for future growth
Leading technology solutions and service partner to the global aquaculture industry
Global presence -subsidiaries in 8 countries
670 employees at end of 2015
Market cap of NOK ~1500m
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Acquisition of Aquatec Solutions A/S
14
• Acquisition finalized at 30.09.2015
• Purchase of all the shares in Aquatec Solutions for a price of DKK 35 million. In addition AKVA paid an adjustment amount based on the net debt and working capital position of Aquatec Solutions as of 30.09.2015. Finally, AKVA will pay to the sellers an additional consideration (earn-out) based on the realized EBITDA of Aquatec Solutions for 2015 and 2016. The parties have agreed an estimated net present value of the earn out in the amount of DKK 21.6 million based on current budgets and forecasts
• The acquisition was paid in cash and is financed with a loan from Danske Bank
• Aquatec Solutions is strengthening AKVA group’s position in the Land Based Technology segment
• Is operated as a stand-alone operation going forward
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An interim dividend of 1.00 NOK per share was paid in November 2015
15
• Step one: NIBD/equity - ratio = 0.22, hence fulfilled with good margin
• Step two: strong underlying performance gives positive operational cash flow YTD 2015
• Dividend paid out in Q4 2015 was 1.00 NOK per share. Total dividend pay out was NOK 25.8 million
AKVA group ASAs’ current dividend policy:
The Company’s main objective is to maximize the return on theinvestment made by its shareholders through both increasedshare prices and dividend payments
AKVA group ASA aims to pay out dividend twice every year, i.e.after 1st half and 2nd half of the year
A two step policy:• The dividend level shall reflect the present and
expected future cash generating potential of AKVAgroup. AKVA group will target a net interest-bearingdebt/equity ratio of less than 0.5x
• When the target debt vs. equity level is met, at least60% of the annual free cash flow after operationaland financial commitments is intended to bedistributed as dividend
Applicable statutory restrictions shall be observed
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Presence in all main farming regions
Map of activities Revenue per region, 2015
Nordic
Americas
Export
Nordic68 %
Americas18 %
Export14 %
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Strategic priority to increase the proportion of OPEX based revenue
OPEX based vs CAPEX based revenue, 2015 Comments
• OPEX based revenue defined as our revenue booked as OPEX in our customers P&L
• Aim of increasing relative share of OPEX based revenue through software and services – by developing software, farming services, technology services and rental further
• Introduction of rental business model in Norway in late 2014. Already successfully introduced in UK and Canada
• Rental is an “all inclusive” service providing for instance light or picture for an agreed period of time (2 to 5 years duration) -reducing CAPEX and reducing operational work for the customer
• Acquisition of YesMaritime in 2014, a provider of diving, ROV and other services to the salmon farming sector (Farming services)
• Development of Farming Services still in an early stage –opportunities for consolidation
CAPEX based
revenue
73 %
OPEX based revenue
27 %
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Revenue by product groups and species
18
Cage based technologies = Cages, barges, feed systems and other operational systems for cage based aquaculture
Software = Software and software systems
Land based technologies = Recirculation systems and technologies for land based aquaculture
By product groups – 2015 By species – 2015
Salmon = Revenue from technology and services sold to production of salmon
Other 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
Cage based75 %
Software9 %
Land based16 %
Salmon80 %
Other species
10 %
Non seafood
10 %
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4. Ordinary agenda items contd.
4.2 Approval of the 2015 annual accounts of AKVA group ASA and the Group, and the board's annual report
“The General Meeting resolved to approve the annual accounts for 2015 for AKVA group ASA and the Group, and the board's annual report, including the board's proposal to transfer the profit of 2015 to other equity.”
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Group P&L 2015(Amounts in NOK 1 000)
Group Note 2015 2014 2013
OPERATING REVENUES
Sales revenues 19 1 420 712 1 246 059 918 670
Other income 22 4 626 - -
Total revenues 2 1 425 338 1 246 059 918 670
OPERATING EXPENSES
Cost of goods sold 11 837 754 759 890 556 603
Payroll expenses 3,15,21 341 094 279 945 229 329
Other operating expenses 4,8,12,17,20 111 332 102 859 85 832
Total operating expenses 1 290 179 1 142 694 871 765
OPERATING PROFIT BEFORE DEPRECIATION AND
AMORTIZATION (EBITDA) 135 159 103 365 46 905
Depreciation and amortization 7,9 47 450 35 729 33 088
OPERATING PROFIT (EBIT) 87 709 67 635 13 817
FINANCIAL INCOME AND EXPENSES
Financial income 17,18 2 984 4 015 1 841
Financial expenses 17,18 (12 603) (8 757) (11 091)
Net financial income (expense) (9 619) (4 741) (9 250)
PROFIT BEFORE TAX 78 090 62 894 4 568
Taxes 5 19 690 8 394 2 193
NET PROFIT FOR THE YEAR 58 400 54 500 2 374
NET PROFIT (LOSS) ATTRIBUTABLE TO:
Non-controlling interests 1 572 -580 -501
Equity holders of AKVA group ASA 56 828 55 080 2 875
Earnings per share (NOK) 6 2,20 2,13 0,11
Diluted earnings per share (NOK) 6 2,21 2,13 0,11
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Group balance 2015(Amounts in NOK 1 000)
Group Note 2015 2014 2013
NON-CURRENT ASSETS
Intangible assets
Deferred tax asset 5 12 659 20 874 25 117
Goodwill 7 269 453 202 688 178 018
Other intangible assets 7 78 677 54 521 47 696
Total intangible assets 360 789 278 083 250 831
Tangible fixed assets
Land and building 9 13 335 10 665 2 804
Machinery and equipment 9 90 160 63 344 52 199
Total tangible fixed assets 103 495 74 009 55 003
Long-term financial assets
Other long-term financial assets 10,12 2 747 1 896 1 967
Total long-term financial assets 2 747 1 896 1 967
Total non-current assets 467 031 353 988 307 801
CURRENT ASSETS
Stock 11 180 677 167 238 144 188
Receivables
Accounts receivables 12,18,19 289 216 262 894 155 539
Prepayments to suppliers 8 925 7 943 4 879
Other receivables 18,19 27 760 57 824 51 244
Total receivables 325 902 328 660 211 662
Cash and cash equivalents 13 109 517 53 935 58 330
Total current assets 616 096 549 833 414 180
TOTAL ASSETS 1 083 127 903 821 721 981
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Group balance 2015(Amounts in NOK 1 000)
Group Note 2015 2014 2013
EQUITY
Equity attributable to equity holders of AKVA group ASA14,21,24,25 424 988 387 577 336 601
Non-controlling interests 3 444 1 676 2 255
Total equity 428 432 389 252 338 856
LIABILITIES
Provisions
Deferred tax liabilities 5 18 107 - -
Pension obligations 15 - - 181
Total provisions 18 107 - 181
Other long term liabilities
Liabilities to financial institutions 16,20 188 375 128 667 55 048
Other long term liabilities 22 15 495 2 677 704
Total other long term liabilities 203 870 131 344 55 752
Current liabilities
Liabilities to financial institutions 13,16,18,20 57 258 13 779 77 840
Trade payables 128 189 135 413 88 957
Current tax payables 5 4 223 2 340 818
Public duties payable 19 341 12 410 13 981
Prepayments from customers 19 115 898 112 955 59 982
Other current liabilities 17,18,22 107 808 106 329 85 613
Total current liabilities 432 717 383 225 327 191
Total Liabilities 654 695 514 569 383 125
TOTAL EQUITY AND LIABILITIES 1 083 127 903 821 721 981
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Summary parent company 2015(Amounts in NOK 1 000)
Parent company Note 2015 2014 2013
NET PROFIT FOR THE YEAR 36 293 45 276 7 280
ALLOCATION OF PROFIT FOR THE YEAR
Other equity 36 293 45 276 7 280
Total allocated 36 293 45 276 7 280
AKVA group ASA
Income statement 01.01. - 31.12.(in NOK 1 000)
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4. Ordinary agenda items contd.
4.3 Determination of Board members’ remuneration
In accordance with the proposal from the Nomination Committee, the General Meeting resolved that the remuneration to the Board of Directors shall be set as follows:
• Chairman of the board: NOK 275,000 per year• Deputy Chairman: NOK 165,000 per year• The remaining board members: NOK 137,500 per year• Board committee member: NOK 5,500 per meeting• Chair Remuneration Committee NOK 12,000 per year• Chair Audit Committee NOK 22,000 per year
• Employee appointed member: NOK 33,000 per year
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4. Ordinary agenda items contd.
4.4 Determination of Nomination Committee members’ remuneration
In accordance with the proposal from the Nomination Committee, the General Meeting resolved that the remuneration shall be set at:
• NOK 25,000 per year to the chairman of the Nomination Committee
• NOK 13,000 per year to each of the remaining members
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4. Ordinary agenda items contd.
4.5 Approval of auditors’ fees
"The General Meeting approves the auditor's fees of NOK 479.000 for the 2015 accounting year."
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4. Ordinary agenda items contd.
4.6 Election of auditor
In accordance with the proposal from the Board of Directors, the General Meeting made the following resolution:
“KPMG AS is elected as auditor for the company.”
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4. Ordinary agenda items contd.
4.7 Advisory vote on the board’s guidelines for the remuneration of leading employees
” The General Meeting endorses item 2 of the board's statement on the determination of salary and other remuneration to leading employees of the company."
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4. Ordinary agenda items contd.
4.8 Approval of the board's guidelines for share-linked incentive arrangements for leading employees
” The General Meeting approves item 3 of the board's statement on the determination of salary and other remuneration to leading employees of the company."
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4. Ordinary agenda items contd.
4.9 Consideration of the board’s statement on corporate governance in accordance with the Norwegian Accounting Act section 3-3 b
"The General Meeting endorses the board's statement on corporate governance, included in the annual report."
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4. Ordinary agenda items contd.
4.10 Election of Board members
In accordance with the proposal from the Nomination Committee, the General Meeting made the following resolution:
The following are elected as members of the board:
Ms. Anne Breiby (elected to 2018) Mr. Hans Kristian Mong (elected to 2018)Ms. Evy Vikene Kallelid (elected to 2018)Mr. Frode Teigen (elected to 2018)Mr. Nils Viga (elected to 2018)Ms. Aino Olaisen (elected to 2017)Mr. Anthony James (elected to 2017)
The Board of Directors elects the Chair and the Deputy Chair.
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4. Ordinary agenda items contd.
4.11 Election of Nomination Committee members
In accordance with the proposal from the Nomination Committee, the General Meeting made the following resolution:
The Nomination Committee shall consist of:
Mr. Eivind Helland, Chair Ms. Therese Log Bergjord, member Mr. Bjørnar Mikalsen, member
Remaining term of service is one year for all Nomination Committee members.
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5. Authorization to increase the share capital
“The board is authorized to increase the company’s share capital by up to NOK 2,583,430, through subscription of new shares. The authorization does not authorize the board to waive the pre-emptive right of shareholders pursuant to section 10-4 of the Public Limited Liability Companies Act (the "Act"), nor carry out a capital increase through payments in non-monetary assets, nor incur special obligations on behalf of the company as set out in section 10-2 of the Act, nor decisions on mergers pursuant to section 13-5 of the Act, and may not be used in connection with the company's option program.
The authorization shall be in force until the earlier of the time of the Annual General Meeting in 2017 and 30 June 2017. This authorization replaces all previous authorizations to the board to increase the company's share capital.”
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6. Authorization to purchase own shares
The board is, pursuant to Section 9-2 to 9-4 of the Public Limited Liability Companies Act, authorized to purchase and hold shares in the Company. The shares to be acquired under this authorization shall not be acquired at a higher value than at market terms on a regulated market where the shares are traded.
This authorization may be used one or several times. The maximum face value of the shares which the Company may acquire pursuant to this authorization is in total NOK 645,857 which equals to approximately 2.5 % of the Company's share capital.
Acquisition of shares pursuant to this authorization may only take place if the Company's distributable reserves according to the most recent balance sheet exceed the remuneration for the shares to be acquired. The board is free to determine how the company’s own shares will be acquired and sold, provided an acquisition under this authorization must be in accordance with prudent and good business practice, with due consideration to losses which may have occurred after the balance-sheet date or to such expected losses.
The authorisation shall be in force until the Annual General Meeting in 2017, however, not later than until 30 June 2017. This authorization replaces the authorization to the board to purchase own shares, given by the General Meeting on 7 May 2015.
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7. Authorisation to the Board to approve the distribution of dividends
The board of directors is authorised pursuant to the Public Limited Liability Companies Act § 8-2(2) to approve the distribution of dividends based on the Company annual accounts for 2015. The authorisation also includes distribution in the form of repayment of paid-in-capital.
The authorisation may be used to approve the distribution of dividends up to an aggregated amount of NOK 75,000,000.
The authorisation is valid for dividends from and including the second quarter of 2016 and until the Annual General Meeting in 2017, however, not later than until 30 June 2017.
The board determines from which date the shares will be traded ex-dividend.
This authorization replaces the authorization to the board to approve the distribution of dividends, given by the General Meeting on 7 May 2015.