· Continued production ramp up at Indre Harøy. Batch 5 stocked in February and
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all-time high biomass production in March.
· Focus on international expansion plans, both in South Korea and North
America.
· Indre Harøy phase 2 preparations ongoing - clear signs of normalization in
the construction market
· Signed agreement with DNB and Nordea for a new green debt financing package
totaling NOK 1,550 million relating to phase 1 and 2 at Indre Harøy.
· Available liquidity of NOK 454 million per 31 March 2023 including committed
undrawn credit facilities.
Subsequent events
· Completed takeover of the last two remaining tanks in phase 1 at Indre Harøy
on the 17[th] of April 2023.
· Carried out NOK 525 million private placement on 18[th] April 2023 as part
of the Indre Harøy phase 2 financing.
· On 29[th] April 2023 the Company reported that it was experiencing increased
mortality in selected fish groups at Indre Harøy. The Company has taken swift
and appropriate actions to remedy the situation and the situation is now
stabilizing with daily mortality back to normal levels post freshwater
treatment.
The increase in biomass production continued in the first quarter with the Group
having a net biomass production of around 740 tonnes and all-time high biomass
production of around 320 tonnes in March alone. As per 31 March 2023 the Company
had a total standing biomass of almost 1,500 tonnes.
Phase 1 of Indre Harøy was finalized in April 2023. With all the 12 tanks
completed, this will allow for a streamlining of the production process with
both production lines fully operational. The preparatory activities for phase 2
continued in the quarter. The Company has made no contractual commitments but is
in advanced negotiations with contractors for phase 2 construction. The plan is
to commence construction during the second half of 2023.
Work on the international expansion plans in South Korea through K Smart Farming
and in North America continued in the quarter. 90 % design review for the smolt
site in South Korea was completed as planned and work on the grow-out site has
been intensified. In parallel, the permitting processes continued with important
clarifications received with regards to key permits. In North America the
Company continues to evaluate identified potential production sites as well as
maintaining dialogue with various stakeholders, both public and private.
Summary and outlook
Since initiating operations at the Indre Harøy facility about 14 months ago, the
Company has gradually ramped up production and a total of five batches have been
stocked. Two smolt releases are scheduled for the second quarter, and three more
are planned in the second half of 2023.
The increased mortality reported ultimo April was triggered by AGD, causing
problems with gill health and is an important reminder of the biological aspect
of the operation. Salmon farming is a complex operation and unexpected things
can and will happen, stressing the importance of having a strong and capable
organization. The event demonstrated the value of being located in the heart of
the aquaculture cluster with solid access to competent people and suppliers and
relevant infrastructure.
The Company has taken swift and appropriate actions to remedy the situation,
including reduced temperatures and feeding, increased UV dosage on intake water,
fast tracking harvest of batch 2 in a historically strong market and completed
freshwater treatment of all remaining fish groups.
The freshwater treatment appears to have had a good effect, and the situation is
now stabilizing with daily mortality back to normal levels post freshwater
treatment. The Company has also recommenced feeding across the farm and is
closely monitoring the situation.
Furthermore, the Company has implemented a number of actions to minimize the
risk of such event happening in the future. This includes inter alia on-site
freshwater production capabilities to be installed over the next couple of
weeks, reducing response time to a minimum going forward and also enabling
precautionary freshwater treatments, for example in connection with fish
transfers.
-We are pleased to see that the decisive actions taken over the last weeks is
now stabilizing the situation and enabling the Company to transition back to
production modus, says CEO in Salmon Evolution Trond Håkon Schaug-Pettersen.
-The successfully completed freshwater treatment also gives invaluable
operational experience that will enhance our capabilities to tackle challenges
going forward, says Schaug-Pettersen.
Salmon Evolution continues to see a significant demand growth potential for
salmon and the Company believes that land-based farming will need to play an
important role alongside conventional farming for the industry to be able
utilize the demand potential. With phase 1 at Indre Harøy now completed and
having a strong financial platform, Salmon Evolution is in a unique position to
continue to lead and shape the development of this industry.
Results presentation
CEO Trond Håkon Schaug-Pettersen and CFO Trond Vadset Veibust will present the
results at Hotel Continental in Oslo, Tuesday 23 May at 08:00 a.m. CEST.
Participants may also follow the presentation and submit questions through a
live webcast available on www.salmonevolution.no, or with the following link:
Registration • Salmon Evolution ® Q1 2023 Presentation.
The presentation and subsequent Q&A will be held in English.
For further information, please contact:
Trond Håkon Schaug-Pettersen, CEO
thsp@salmone.no
+47 91 19 13 27
Trond Vadset Veibust, CFO
tvv@salmone.no
+47 48 09 05 95
About Salmon Evolution
Salmon Evolution is a Norwegian land-based salmon farming company targeting a
production capacity of 100,000 tonnes HOG by 2032. The Company’s core focus is
on extending the ocean’s potential by transferring the best preconditions
offered by the sea to farm fish on land through its chosen hybrid flow-through
system technology (HFS). This secures a truly sustainable production process
with controlled and optimal growth conditions and limiting operational and
biological risk.
The Company’s first production facility is strategically located at Indre Harøy
on the Norwegian west coast with unlimited access to fresh seawater, renewable
energy, established infrastructure, and an educated and experienced work force.
Phase 1 is already in operation and will have an annual capacity of 7,900 tonnes
HOG at steady state. Fully developed, the Indre Harøy facility will have an
annual capacity of 31,500 tonnes HOG.
The Company has also entered into a joint venture with Dongwon Industries where
the parties will develop, construct and operate a land-based salmon farming
facility in South Korea with an annual production capacity of 16,800 tonnes HOG,
using Salmon Evolution’s chosen HFS technology.
Furthermore, Salmon Evolution has initiated a process with the aim of
establishing a land-based salmon farming operation in North America.
Salmon Evolution ASA is listed on Oslo Børs under the ticker SALME.
To learn more, please visit www.salmonevolution.no
This information is subject to the disclosure requirements pursuant to section 5
-12 of the Norwegian Securities Trading Act.
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