INTERIM REPORT 2016 SECOND QUARTER (Q2) Summary - Revenue in the second quarter came to 517 million kroner, 2 million kroner lower than the second quarter of 2015 - Sales prices increased but sales volumes decreased compared to the same period last year - EBIT came to -19 million kroner in the second quarter compared to -16 million kroner in the same period in 2015 - Margins per kilo increased compared to the same period last year, and production costs increased slightly. - Net interest-bearing debt decreased with 82 million kroner, from 432 million kroner on March 31 to 349 million kroner on June 30, primarily due to reductions in customer receivables - The equity ratio decreased from 7.4 per cent to 5.0 per cent over the quarter Main figures NOK million Year to date Year Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 2015 2016 2015 Operating revenues 519 457 433 651 517 1 089 1 168 1 979 EBITDA (10) (8) (11) 20 (13) 10 7 (9) EBIT (16) (0) (15) 14 (19) (2) (5) (18) EBIT Margin -3,1 % -0,1 % -3,6 % 2,2 % -3,7 % -0,2 % -0,4 % -0,9 % Net finance (2) (2) (2) (10) (6) (5) (16) (9) Profit before tax (18) (2) (18) 5 (26) (7) (21) (26) Net profit/loss continued operations (17) (5) (28) 5 (26) (6) (21) (38) Net profit/loss discontinued operations (0) (0) - 0 0-0 0 Net profit for the period (17) (5) (28) 5 (26) (6) (21) (38) Earning per share(eps) (øre) cont.op (20) (6) (33) 6 (30) (7) (25) (45) Total assets 624 596 586 770 617 624 617 586 Equity 79 82 54 57 31 79 31 54 Equity ratio (%) 12,6 % 13,8 % 9,2 % 7,4 % 5,0 % 12,6 % 5,0 % 9,2 % Net interest bearing debt (316) (270) (335) (432) (349) (316) (349) (335) Working capital 208 162 201 299 213 208 213 201 Norway Seafoods Group AS, Inkognitogaten 8, N-0256 Oslo, PO Box 1301 Vika, N-0112 Oslo, Norway Business ID: NO 995 203 626 MVA Telephone: +47 76 06 20 00 Email: post@norwayseafoods.com www.norwayseafoods.com
Financial results Sales for Norway Seafoods came to 517 million kroner in the second quarter, compared to 519 million kroner for the same period in 2015. Sales prices increased but sales volumes decreased. Gross margins increased compared to the same period last year. Production costs increased slightly per kilo. EBIT for the second quarter was -19 million kroner compared to -16 million kroner in the same period last year. Net financial items came to -6 million kroner in the second quarter, compared to -2 million kroner for the same period in 2015. The net financial items include net interest expenses as well as currency gains and losses. Currency losses increased compared to the same period last year. Sales and Market Sold volume of primary processed products from the Norwegian operations was 4 335 tons in the second quarter compared to 4 746 tons for the same period last year. Sales of whole unprocessed fish from the Norwegian operations decreased from 4 650 tons to 3 178 tons in the quarter. According to the Norwegian Seafood Council, Norwegian export volumes of fresh whole cod decreased by 4.4 per cent in the second quarter of 2016 compared to the same period last year. Prices on fresh cod fillets increased by 14 per cent in the second quarter of 2016 compared to the same period in 2015, and prices for frozen cod fillets (not block) increased by 16 per cent. Export volumes of fresh cod fillets from Norway decreased by 7 per cent, and volumes of frozen cod fillets increased by 3 per cent. Sales of fresh value added products were 580 tons in the second quarter compared to 696 tons in the corresponding period in 2015, while sales of frozen value added products decreased from 1058 to 616 tons. The decrease is a result of lower volumes from the value added products business in Denmark which ceased production in January 2016. Processing The volume of primary processed products from the Norwegian operations was 5 009 tons in the second quarter compared to 3849 tons for the same period in 2015. Raw material prices for cod in the second quarter increased by 29 per cent compared to the same period last year. The proportion of fresh products decreased from 37 per cent in the second quarter of 2015 to 28 per cent in the second quarter of 2016 for the Norwegian operations, mainly due to increased use of frozen raw materials. The production of fresh value added products was 558 tons in the quarter compared to 693 2
tons in the second quarter of 2015. Norway Seafoods frozen value added factories decreased the production volume during the quarter and produced 786 tons compared to 890 tons for the same period in 2015. Balance sheet and liquidity Total assets decreased with 152 million kroner in the second quarter to 617 million kroner compared to 770 million kroner on March 31. Investments in the second quarter came to -1 million kroner due to sale of equipment in Denmark in the second quarter this year. Bank deposits, including drawing rights, totaled 65 million kroner on June 30, compared to 33 million on March 31. Working capital was 213 million kroner on June 30, a decrease of 87 million kroner from March 31. The working capital was 5 million kroner higher than in the same period last year. Net interest-bearing debt came to 349 million kroner on June 30, a decrease of 82 million from 432 million on March 31. Norway Seafoods equity on June 30 was 31 million kroner, representing an equity ratio of 5.0 per cent compared with 7.4 per cent on March 31. Cash flow Cash flow from operating activities was positive with 83 million kroner in the second quarter. Cash flow from investing activities was positive with 1 million kroner. Cash flow from financing activities was negative with 82 million kroner. Net cash flow was positive with 2 million kroner. Events in the quarter and after the balance sheet date Lerøy becomes new majority shareholder in Norway Seafoods Lerøy Seafood Group ASA has entered an agreement to purchase all shares held by Aker ASA in Norway Seafoods Group AS and Havfisk ASA. Through this transaction, Lerøy will become majority shareholder in both companies. Lerøy intends to offer all other shareholders in the two companies to sell their shares to Lerøy when the transaction is completed. The agreement was signed in June and is subject to approval from relevant authorities in several countries. 3
Profit and loss accounts Group NOK million Year to date Year Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 2015 2016 2015 Operating revenues 519 457 433 651 517 1 089 1 168 1 979 Operating expenses (530) (465) (444) (631) (530) (1 079) (1 161) (1 989) EBITDA (10) (8) (11) 20 (13) 10 7 (9) EBITDA Margin -2,0 % -1,8 % -2,6 % 3,1 % -2,5 % 0,9 % 0,6 % -0,5 % Depreciations (6) (6) (6) (7) (6) (12) (13) (25) Non-recurring items - 14 2 1 (0) - 1 17 EBIT (16) (0) (15) 14 (19) (2) (5) (18) EBIT Margin -3,1 % -0,1 % -3,6 % 2,2 % -3,7 % -0,2 % -0,4 % -0,9 % Net finance (2) (2) (2) (10) (6) (5) (16) (9) Profit before tax (18) (2) (18) 5 (26) (7) (21) (26) Tax on ordinary profit 1 (3) (10) 0 0 1 0 (12) Net profit/loss continued operations (17) (5) (28) 5 (26) (6) (21) (38) Net profit/loss discontinued operations (0) (0) - 0 0-0 0 Net profit for the period (17) (5) (28) 5 (26) (6) (21) (38) Minority interest - - - - Majority interest (17) (5) (28) 5 (26) (6) (21) (38) 4
Norway Seafoods group Balance sheet Assets Amount in NOK million 30.06.2015 30.09.2015 31.12.2015 31.03.2016 30.06.2016 Intangible Assets 24 21 11 11 11 Fixed tangible assets 132 135 135 133 131 Total intangible/tangible assets 155 157 146 144 142 Financial interest-bearing fixed assets 34 35 21 20 19 Financial interest-free fixed assets 0 0 0 0 0 Shares and other equity investments 10 10 3 3 3 Total financial fixed assets 44 45 24 23 22 Total fixed assets 199 202 170 167 164 Biological assets Inventory 108 120 129 169 202 Interest-free short-term receivables 288 246 235 388 223 Interest-bearing short-term receivables 0 0 0 0 0 Liquid assets 7 5 9 4 6 Assets discontinued operations 22 24 43 42 22 Total current assets 425 394 417 603 453 Total assets 624 596 586 770 617 Equity and liabilities Amount in NOK million 30.06.2015 30.09.2015 31.12.2015 31.03.2016 30.06.2016 Total shareholders equity 78 81 53 56 30 Minority interests 1 1 0 1 1 Total shareholders equity and minority interests 79 82 54 57 31 Provisions and other interest-free long-term liabilities 0 0 0 0 0 Interest-bearing long-term debt 221 220 221 230 228 Total long-term liabilities 221 220 221 230 228 Interest-free short-term debt 188 204 164 257 212 Interest-bearing short term debt 137 90 143 225 146 Liabilities discontinued operations 0 0 4 0 0 Total short-term liabilities 325 294 311 483 358 Total shareholders equity and liabilities 624 596 586 770 617 5
Cash Flow statement from continued operations NOK million Year to date Year Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 2015 2 016 2015 Profit before tax (18) (2) (17) 5 (26) (7) (21) (25) Sales losses/gains - - - - - - - - Depreciations and amortisations 6 6 6 7 6 12 13 25 Changes in other net operating assets 77 35 (46) (95) 103 (13) 8 (24) Cash flow from operating activities 65 40 (56) (83) 83 (8) 0 (24) Cash flow from investing activities (8) 6 (1) (4) 1 (15) (3) (10) Cash flow from financing activities (57) (48) 62 82 (82) 20 0 34 Total cash flow from reporting period 1 (2) 4 (5) 2 (2) (3) 0 Effects on changes in exchangerates on cash 0 0 0 (0) (0) (0) (0) 0 Cash and cash equivalent at the beginning of the period 6 6 5 9 4 6 9 9 Cash and cash equivalent at the end of the period 6 5 9 4 6 6 6 9 Not utilised credit facilities 77 76 27 29 59 77 59 27 Cash and cash equivalent at the end of the period, incl. credit facilities 83 81 36 33 65 83 65 36 Oslo, July 19 th 2016 The Board of Directors and CEO, Norway Seafoods Group AS 6