DNB & IntraFish
Seafood Investment Forum
19th November 2013
Dag Sletmo, Investor Relations Manager
Agenda
 Company overview
 3Q results
 Biological outlook
 Market outlook
 Regulatory issues and growth
2
Cermaq top 3 farmer by volume, large Chile
exposure
GLOBAL HARVEST OF ATLANTIC SALMON (2013e )
CERMAQ (SOLD VOLUME, LTM per Q3 2013)
Canada
Others
Chile
-107
(5%)
-468
(23%)
Others
0
-18
(0%)
(12%)
-298
(15%)
Canada
GLOBAL TOP 20 SALMON FAMRMERS
53
(36%)
Norway
1,138
(57%) Norway
-75
(51%)
Chile
3
A global leader in sustainable aquaculture
Cermaq’s value chain
Pelagic
fishing
-Terrestrial
farming
-Fish meal
and fish oil
production
-Raw
material
processing
-Research &
development
-Feed
production
Research & Development
-Smolt
-production
-Salmon
farming
-Primary
-processing
-Secondary
-Processing
-(VAP)
4
Shareholders
#
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Holding pct
59,2
7,7
5,4
2,1
1,7
1,5
1,1
1,1
1,1
0,9
0,8
0,7
0,7
0,5
0,5
0,5
0,5
0,4
0,4
0,4
Name
NÆRINGS- OG HANDELSD
LANSDOWNE DEVELOPED
FOLKETRYGDFONDET
THE BANK OF NEW YORK
PARETO AKSJE NORGE
JPMORGAN CHASE BANK,
LANSDOWNE UK STRATEG
MONTAGUE PLACE CUSTO
SKANDINAVISKA ENSKIL
STATE STREET BANK &
DZ PRIVATBANK S.A.
PARETO AKTIV
KVERVA AS
THE BANK OF NEW YORK
KLP AKSJE NORGE INDE
VERDIPAPIRFONDET HAN
MORGAN STANLEY & CO
THE NORTHERN TRUST C
BNP PARIBAS SEC SERV
PIMCO EQS PATHFINDER
Country
NOR
GBR
NOR
BEL
NOR
GBR
GBR
GBR
NOR
USA
LUX
NOR
NOR
BEL
NOR
NOR
USA
GBR
FRA
USA
Account type
Ordinary
Ordinary
Ordinary
Nominee
Ordinary
Nominee
Ordinary
Nominee
Ordinary
Nominee
Nominee
Ordinary
Ordinary
Nominee
Ordinary
Ordinary
Nominee
Nominee
Nominee
Ordinary
5
 Company overview
 3Q results
 Biological outlook
 Market outlook
 Regulatory issues and growth
6
Highlights – Cermaq pro forma
(NOKm) - pro forma**
Q3 13
Q3 12
Operating revenues
EBIT pre gain*
1 114
113
663
(97)
(NOKm)
Q3 13
Q2 13
ROCE - combined
operations***
7.1 %
6.3 %
NIBD - combined
operations
3 196
4 155
Equity ratio - total
operations
46.7 %

Group pro forma EBIT pre fair value NOK 113m
-
Excludes EWOS results for Q3

Mainstream EBIT pre fair value NOK 144m
from improved salmon prices

Sale of EWOS successfully completed 31 Oct
-
44.1 %

Classified as discontinued operations from Q313
NOK 114m gain from sale of Copeinca shares
-
Proceeds of NOK 929m received in Q3
*
EBIT pre fair value adjustments on live inventory and non-recurring items
** Pro forma is exluding EWOS
*** Return on capital employed, 12-months rolling average, based on EBIT pre fair value and bargain purchase gain
7
Mainstream results
(NOK million, NOK per kg)
Volum es sold (kt, gw e)
Q3 13
Q3 12
27.9
24.5
EBIT Q3 13 vs Q3 12
250
-110
200
Operating revenues
EBIT*
1 110.8
150
144.0
(72.9)
100
5.2
(3.0)
50
4.2 %
1.2 %
EBIT per kg
ROCE (12-month rolling avg.)
2
664.5
* excl no n-recurring items
350
144
0
-50
-73
-24
-100

2
-150
Volumes increased by 14% vs Q312
-
3kt below communicated estimate for Q313
Q3 12 Volume Price
Cost
Other Q3 13
Return on capital employed
(12-month rolling average)

Strong EBIT improvement from Q312
-
Substantial increase in salmon prices vs Q312
-
Solid contribution from all regions
4.2 %
1.2 %
(0.6)%

Positive ROCE 12m - first time in 4 quarters
Q3 12
(5.3)%
Q4 12
(5.0)%
Q1 13
Q2 13
Q3 13
8
3Q results
Sale of EWOS completed

Key financial highlights of the transaction
-

Enterprise Value NOK 6.5bn
Proceeds of NOK 6.2bn received at closing 31 October 2013
Contingent consideration of NOK 180m to be received at a later stage
Final proceeds based on a completion statement before year-end
-
Concluding certain adjustment items, including net working capital (NWC) vs normalized NWC

Reported gain estimated at NOK 2.0–2.5bn

Extraordinary dividend in the range of NOK 4.5–5.0bn (NOK 48–54/share)
-
Extraordinary General Meeting (EGM) expected late December
Refinancing of Cermaq to be completed prior to EGM
Likely payment date early January 2014
To be paid out as ordinary dividend
9
Cermaq pro forma financials
Q3 13
Q3 12
(Figures in NOKm)
Pro forma
Operating revenues
YTD 13 YTD 12
Pro forma
1 114
663
3 484
EBITDA
EBITDA margin
177
16 %
(105)
-16 %
514
15 %
(44)
-2 %
EBIT pre FV
EBIT margin
113
10 %
(97)
-15 %
281
8%
(97)
-5 %
(Figures in NOKm)

Pro forma figures for illustrative purposes

The pro forma balance
2 100
- Includes operational items in Mainstream towards
EWOS
- Excludes all financial items towards EWOS
- Excludes any cash balance in CEQ
30.09.13
Pro forma
Fixed assets
Intangible assets
Financial fixed assets
Total non-current assets
1 944
2 027
58
4 030
Inventories
Accounts receivables
Other current receivables
Total current assets
3 629
447
361
4 437
Total assets*
8 467
Account payables
Other current liabilities
Total current liabilities
645
311
956
Deferred taxes and Pension obligations
951
NIBD/Equity
6 561
Total equity and liabilities
* excluding cash
8 467

NIBD & Equity line only for illustration
10
 Company overview
 3Q results
 Biological outlook
 Market outlook
 Regulatory issues and growth
11
Current fish health status
-MS Canada
-MS Norway
No new outbreaks of IHN – All fish in
BC vaccinated

Overall status is good

Mortality is low

Higher than normal sea lice levels,
but not alarming


Algae and low Dissolved Oxygen
levels (DO)
Higher than normal sea lice levels
this fall. Resistance in Nordland is
causing concerns

PD in Finnmark. All sites in
Langfjorden depopulated

-MS Chile

Caligus and SRS is challenging, but
levels better than last quarter

Increasing use of antibiotics
12
Preventive measures per country
-MS Canada
-MS Norway

IHN: Screening, reduced handling
and vaccination

Stress reducing measures

Education and competence building
Winter Ulcers: Vaccination, vitamin
C trials and antibiotics trials

Working on smolt sourcing


Algae and DO: Close monitoring and
preventive measures. Results from
R&D promising
-MS Chile

Selective use of sites

SRS vaccine trials

Antiparasite treatments
13
Sanitary situation in Chile – lice level improved
12
Caligus per Atlantic salmon
Average harvest weight, Atlantic salmon
(Adult females + mobile)
kg RWE
6
8
5
6
4
Kg RWE
10
4
3
2
0
1
Jan-09
Apr-09
jul.09
okt.09
Jan-10
Apr-10
jul.10
okt.10
Jan-11
Apr-11
jul.11
okt.11
Jan-12
Apr-12
jul.12
okt.12
Jan.13
Apr.13
Jul.13
2
3%
 Reduced sea lice levels
Jan-09
Apr-09
jul.09
okt.09
Jan-10
Apr-10
jul.10
okt.10
Jan-11
Apr-11
jul.11
okt.11
Jan-12
Apr-12
jul.12
okt.12
Jan-13
Apr-13
jul.13
0
Mortality Atlantic salmon
monthly
Antibiotics usage Mainstream Chile
600
Gr/t LWE
-
More industry coordination
-
Regulator activity
-
Winter season
 Improved mortality
-
SRS main challenge but
better control of disease
-
Early harvest of CAD sites*
-
Seasonality
500
2%
400
300
1%
200
100
All data are for Mainstream Chile
Q3/13
Q2/13
Q1/13
Q4/12
Q3/12
Q2/12
Q1/12
Q4/11
Q3/11
Q2/11
Q1/11
Q4/10
Q3/10
Q2/10
Q1/10
Q4/09
Q3/09
Q2/09
-
Q1/09
Jan-09
Apr-09
jul.09
okt.09
Jan-10
Apr-10
jul.10
okt.10
Jan-11
Apr-11
jul.11
okt.11
Jan-12
Apr-12
jul.12
okt.12
Jan-13
Apr-13
jul.13
0%
*Category high dissemination site (sites with weekly average of more than 9 total adult caligus per fish)
14
Regional profitability
EBIT/kg, NOK
20
recovering
market prices,
biological
challenges in
Chile lift cost Norway
15
10
declining
market prices
5
-10
3Q13
1Q13
3Q12
1Q12
3Q11
3Q10
1Q10
3Q09
1Q09
3Q08
1Q08
3Q07
1Q07
1Q11
ISA recovery
and strong
prices
0
-5
Canada
Chile
ISA crisis
-15
15
The cornerstones of Cermaq’s strategy
-Diversification by geography
and species
-Smolt quality
-Diversification
-Optimal feed and nutrition
-Preventive fish health
16
Market outlook
 Company overview
 3Q results
 Biological outlook
 Market outlook
 Regulatory issues and growth
17
Harvest and supply
Harvest of Atlantic salmon
kTonnes WFE
Q3 12
Q3 13
FY 12
World wide harvest of farmed salmonids
FY 13E
FY 14E
(kTonnes WFE)
2 750
REGION
2 500
Canada
30
28
124
107
113
Chile
97
113
364
470
488
2 250
295
282
1 183
1 135
1 169
2 000
UK
42
40
159
151
148
1 750
Other
35
37
152
156
163
1 500
499
500
1 982
2 019
2 081
1 250
Norw ay
EST. HARVEST
Source: Kontali Analyse
1 000
750
500
Sales per region of Atlantic salmon
250
-
kTonnes WFE
Q3 12
Q3 13
FY 12
FY 13E
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E 2014E
A tlantic salmo n
Large tro ut
Co ho
REGION
EU
234
233
918
921
USA
89
88
345
366
Japan
16
15
63
56
Russia
40
36
172
163
China / Hong Kong
16
17
62
65
Brazil
17
22
72
86
Other
83
93
339
366
497
505
1 971
2 023
EST. SUPPLY
Source: Kontali Analyse
Source: Kontali Analyse
18
Outlook 2014
Annual harvest, kt
109 kt
120 kt

161 kt
141 kt
180

+14%
160
+18%
+10%
140
Canada; 21
Canada; 15

120
Norway; 56
Norway; 51
Canada; 21
80

Norway; 51
Norway; 38
60
40
20
Chile; 75
Chile; 49
Chile; 84
Chile; 50
Coho Harvest vs Sales vs Consumption, seasonality
35 %
30 %
0
ACT
ACT
EST
EST
FY 11
FY 12
FY 13
FY 14
monthly share of full year volume
kt, gwe
Canada; 19
100
Strong Coho season to support improved
results in Chile
Reduction of biological challenges and
cost improvement in Chile main focus in
2014
14% organic volume growth 2014 vs
2013
Continued tight supply supports strong
market during 2014
30 %
25 %
23 %
22 %
20 %
15 %
15 %
10 %
5%
15 %
15 %
13 %
8%
10 %
8%
8%
9%
8%
1010
%%
8%
9%
8%
9%
8%
9%
7%
8%
8%
8%
5%
3%
2%
2%
0%
0%
Sep
Oct
Nov
Dec
Harvest
Jan
Feb
Sales
Mar
0%
Apr
Consumption
0%
May
0%
Jun
0%
Jul
2%
0%
Ago
19
Market prices farmed salmonids
Europe - Norway (FCA Oslo)
USA - Chile / Canada
(NOK/kg)
(USD/lb)
7
50
6
45
40
5
35
30
4
25
3
20
2
15
10
1
5
0
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Chilean A tlantic fillet, FOB M iami, 3-4 lb, C-Trim
Source: NOS, Kontali
Source: NOS, Kontali
Canada (West co ast) who le fish fresh, FOB Seattle, 8-10 lb
Japan - Chile, Tsukiji wholesale market
(USD/kg)
Japan - Chile (wholesale Tsukiji market)
9
(JPY/kg)
8
800
7
700
6
600
5
500
4
400
200
2012
W 42
W 39
W 36
W 33
W 30
W 27
W 24
W 21
W 18
W 15
W 12
W 09
W 06
W 03
W 52
W 49
W 46
W 43
W 40
W 37
W 34
W 31
3
300
2013
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Trout
Source: Urner Barry
Japan - Chile frozen coho 4-6lb JPY/kg
Japan - Chile frozen trout 4-6lb JPY/kg
Coho
Source: Urner Berry
20
 Company overview
 3Q results
 Biological outlook
 Market outlook
 Regulatory issues and growth
21
Demand for animal proteins increases
-Source: UN Population Division, Brookings Institution, FAO
-Source: Food and Agriculture Organisation.
-Graph courtesy The Economist
22
Demand: emerging markets a key driver

Growing population drives food demand
-Sources: FAO, IMF, Cermaq

Growing income levels drive protein
demand
23
Supply: seafood is a small food category

Seafood 2% of world food production
- Farmed salmon only 1.5% of seafood production
- Plenty room for growth
-World food consumption, calories
-Sources: FAO
24
Supply: flat wild catch an opportunity and a
threat

Opportunity: wild catch has been flat for 25 years


Aquaculture must provide the growth to satisfy growing demand
Threat: marine content in salmon feed comes from wild catch
-Sources: FAO
25
Salmon farming is efficient, low on carbon footprint
and fresh water usage – and tastes good!
26
Growth has been massive – can it continue?
•
Volume 10.1% CAGR last 20 years, 6.5% CAGR last 10 years
-Source: Kontali
27
Prerequisites for continued growth

Regulatory issues
- Norway
- Chile
- Canada

Access to raw materials for feed
- Potential from discards and trimmings
28
Feed raw material availability
So far so good, but there is a limit
-Millions of tonnes
MT, feed sold vs marine ingredients used. EWOS
29
Feed resources for the future
Discards and trimmings are very interesting
Partially used (known resources
globally)
Future (new) sources globally:
Animal plankton (krill, raudåte)



Harvest from fishing which is not used for
human consumption (20-30 mill tonnes)
Macro algae
Discards from fishing fleet and processing
Agricultural waste from plants and
animals

From fleet 7 mill tonnes

From processing 26 mill tonnes
Onecell biomass
Genetically modified plants
Agricultural products and waste
-Important to create an economic incentive for the fishing fleet to deliver discards
and trimmings to the aquafeed industry. The physical product is there, the buyers
are there and willing to pay – but the logistics chain must be built
30