Okay. I have the pleasure welcoming you all, for our Capital Market Day 2022 for Lerøy Seafood Group. My name is Henning Beltestad. I'm the CEO of Lerøy Seafood Group, and it's a very special day, for me and also for the team in Lerøy Midt. Having you here. We are so proud of Lerøy Midt and this value chain, and to show you this, these two days, it's our great pleasure. We really feel that we are a little bit nervous, and hopefully you will find this, as you expected or even a little bit better. First of all, I will take you through the program. It's now 12:00PM. I will start the presentation about Lerøy Seafood Group and with the main focus on the strategy of the Group. We will have at 1:30 PM a break of 50 minutes. We will have Bjarne Reinert take us through the farming. We will have breakout sessions at 3:30 PM. We will split that into four groups, VAP Sales and Distribution with Ivar Wulff, Lerøy Aurora with Kurt-Einar Karlsen, Lerøy Midt with Harald Larssen, and Lerøy Sjøtroll with Nina Møgster. That's the end of the presentations and the discussions before we go to break. We will have a break until 7:15 PM, and we will enjoy a fantastic seafood dinner in a lovely restaurant. I can tell you it's. You know, I've been there a few times, it's the best. You really have something to look forward to. Of course, it's who is the supplier of the seafood. We secure that the quality is on top level. Yeah, it will be a fantastic dinner and evening, hopefully. Tomorrow is a program. We gonna see what I've talked about for many years and also shown videos of this value chain, and now you're gonna see it live. I can promise you will not be disappointed because this is fantastic, what you're gonna see these two days. There will be three destinations tomorrow. The factory here and the feed center, they're right above us here. Belsvik, the smolt facility, and Storskogøya location right over here. We will be able to do that in five hours before we go back home. Hopefully that everyone with a smile on their face. That's our goal. To give you a good view of who we are and what we are able to do, and give you a feeling of the company Lerøy and that we are on the right track. First of all, I will go through some, you know, go through our historical performance, a little bit about the history, why we have done what we have done until now. We're gonna talk a lot about where do we go forward, and we will talk about strategy, objectives, and of course, how we're gonna work to reach the objectives. Yeah. This one, you know, in every quarterly presentation I show it. You know, this is, for me, when I wake up in the morning, I open my eyes, I see this, and I'm ready for work. I'm ready. You know, it's so important for me, you know, this goal, creating the world's most efficient and sustainable value chain for seafood. That has been a very, important part of my life, the last actually 30, but especially the last 20 years, you know, developing a value chain. Are we able to reach that goal in three years? We believe so, but how are we gonna secure that we reach it, and how are we as a company with 5,500 employees manage to do it? You know, it's hard to be a manager of a football team, but that's 11 players or maybe 20, 22, and you want them to follow the manager's strategy. In a way, that's easy. To do it with 5,500 people is more complicated, and a company close to 70 companies, and all over the world. We like that. Last year, we had a turnover of NOK 35 billion. We have a fishery of 71,000 tons and 186,000 tons harvest of salmon and trout. That's our base, 2021. Now we look forward. Our fantastic value chain, twenty years development. It's not a quick fix. You cannot do this in one or two years. It's impossible. It takes a lot of focus, a lot of energy, a lot of hard work, you know, to build a value chain like this. Twenty years ago, we were one company, Hallvard. We thought that we were the world champions in sales and export, and probably we were. That's where we come from. We are an extremely market-oriented company, good in developing markets, customers, and products. It was not enough because our customers, they required more. They required stability and supply, security, food safety, traceability, and it became more and more demanding for us as a company to follow up and to give what our customers needed. Because working with 20, 30, you know, third party suppliers of salmon, you know, that's a tough one to handle that many suppliers to deliver to the customers. We started early 2000 investing into farming, and then in 2003 it was a dream when the management in Lerøy at that time decided to acquire Midnor, which is Lerøy Midt today. Here we are today. We are so proud of this company and of course, all of the farming companies. Today, we're gonna see what we do in this region and what we have developed together with the people in Lerøy Midt. Step by step, we buy Aurora in 2005. [crosstalk] and we invest also in Finnmark. We were the second largest producer of salmon and trout. We're probably on third place now, but that's okay. It's not the size that is most important. It's what we build. We fully integrated in salmon farming. We have also the 20 last years developed downstream activities, VAP factories, distribution centers to connect all the way to the end customer, all the way to the shop. There we are and have been for some years for the salmon and trout. In 2017, our customers start asking us about the whitefish. How do you want to secure the value chain for whitefish? How can you control the quality on the boats?" That was a difficult question, you know. Should we do it with small, go into factories, or how should we do it? We decided to acquire Havfisk and Norway Seafoods, and that was a new journey for Lerøy. I'm so glad we did it because it makes us unique, and I think that the customers also looks at us as unique and a preferred partner. This fantastic value chain, we are so proud of. Integrated value chain, it gives a distinct competitive advantage with our customers. It really does. Four market trends. We put sustainability on the top because it's really coming fast. In our discussions with our customer today, it's totally different than what it was two years ago. It's so important for the customer to have a sustainable value chain all the way out to the end customer. Quality and traceability, I mentioned earlier, extremely important to have the right quality that the consumer acquire. Stability, availability, and then convenience. The convenience part is not easy either. How do you develop the category? Make it more available. No one eats a whole fish anymore. It's not the convenience product to have a whole fish to the consumer. They don't know how to fillet it. You also work with a category, and this we have done for 15, 20 years, developing the category, making it more convenient. We are uniquely positioned to leverage speed and cost efficiency, reliability and trust, product and category innovation, end-to-end traceability and quality assurance, and clear commitments towards social and environmental impact. It is a unique position. Maybe the other strategy has been right the last 20 years, being in the spot market and taking out, you know, the best price in the spot, but for the future, it's not enough. You need to be connected in a fully integrated value chain to develop category and with the best customers. This one, I think I've shown it 50 times. I've seen it myself 200 times, and I'm still, you know, I love to see it. This we made two, I think 2.5 year ago because we wanted to show the value chain. This value chain that we show you now, this is exactly what you will see tomorrow. It starts in a Kiwi shop in Bergen, and it goes all the way to the road. Enjoy it on film, and tomorrow it will be in real. When we look ahead, determined to give you the most sustainable salmon possible, we need to rethink the entire value chain. We need to make every step smarter and even more efficient. We are not there yet, but we are on the right track because here you see the salmon of the future. We are not there yet. That's right. It's also right that we are on the right track. If we look at the history of Lerøy in the last 20 years, we are around NOK 2 billion in turnover in 2002, and last year, NOK 23 billion. A yearly average growth rate of 12%. You know, turnover is one thing, you know, but you know, of course, we want to have the bottom line, you know. That's the most important thing, and then that we grow the company in the right way. For us, you know, it's extremely important to have a growth strategy. To create is one of the main value that we have. This will continue. We will grow, but we will grow in the whole value chain. We had a fantastic development. Also, when it comes to return on capital employed, we talk about the objectives, the goals, and I have to say that the top management in Gjøvik, with the CFO at that time, Helge Singelstad, made a goal beginning of 2000. 18% return on capital employed. It was not many that believed in that at that time when it started. We were at maybe 10% or under that before 2002. 18%. The average is 17%. Fantastic. We almost delivered. Okay. It was 17%, not 18%, but close to. There we delivered on our goals. We are extremely long-term oriented. I will say that we are probably the company, the seafood company which is the most long-term oriented, and the history shows that both in growth and also in profit. When it comes to investments, we have a board that really believe in what we do and where we want to go, and we have invested a lot the last 10, 15 years. But the last five years, we see that it's going a little bit down in 2021 and 2022. We see heavy investments into smolt in 2018 and also in 2019 and 2020. We see it's only a small part in 2022. Tomorrow you're gonna see Belsvik 2, which is the latest investment in smolt. When we talk about targets and 2025 targets, the base is what we have invested in. We will achieve the goals based on the investments done. Okay. The goals is only three years ahead, but we have invested in a fantastic value chain, and now we will take out the potential of it. That's the thinking. Going forward, the annual investments in maintenance will be around NOK 800 to 900 million. We will, of course, continue to invest in growth opportunities because we are gonna grow further after 2025 also. That we need to come back to. Where we come from, the sales, the market, and we have a fantastic segment here, heavily investing into Europe, of course, and sales offices in Japan, China, and North America, and also now into UK. UK is a market where we have a huge potential of improvement, and it's a huge potential for the whitefish that we have and of course the salmon and trout. We will see what comes in UK. We will have the sessions later also, so it's possible to discuss what we are thinking about in UK, in that part. The main part today is the main focus will be on farming. Because we needed probably three to four days if we really should go into all of it. Then we will come back with a new capital market day where we can go into VAP sales and distribution and wild catch more in detail for that. We look into our objectives and the strategy going forward. We have set some ambitious targets for 2025, which we really believe that is possible to reach. If not, we wouldn't do it. We have also some targets for 2030. As I said earlier, growth is important. We have set a goal of NOK 50 billion in 2030 in turnover. That means that we need to create more value through our the whole value chain to attract more customers. There's no reason why we shouldn't reach that. Eight years ago, we draw the same line internally, and every once in a while it's impossible to go to NOK 25 billion. We were at NOK 12 billion, but we are there. I think for the organization internally, it's extremely important to see that we have ambitions and that we want to grow. This is a company where we can develop the people and it's exciting for people to work in. If the board told me to keep okay, this is okay. No, you're only gonna take out the potential of what you own. You don't, you will not grow anymore. I don't think it would be a right place for me to be because I'm extremely motivated by, you know, the growth. We have set ambitious goal for a reduction in emission of 46%. That's also reachable. I come back to that a little bit later. We believe it's possible. When people tell me internally or, you know, we are never gonna reach 46% reduction, then we are gonna reach it. We really need to focus on it. We have suppliers that's really gonna work hard to help us reach it. Our customers are dependent that we reach that goal. They need reach their goal. We are the ones that need to do that for them. Come back to that afterwards. It's the farming value chain all the way to customers. Our ambitions, and we believe that we can be number one. Because we have the value chain, and we can make this value chain much better. EBIT all inclusive, both farming and VAP sales and distribution. We believe that we will be number one. That's our goal, but it will be hard work. For the wild catch also, we have a goal of NOK 500 million. Of course, it's not like farming margins, but we see great improvements in the operational of the whitefish industry. We have a huge potential taking out more value of our whitefish, the cod, the saithe, the haddock. One thing, what is the price of saithe? When we started, we had a presentation in 2016. It was NOK 10, now it's NOK 25. We see that the market for saithe is also improving a lot. All food, all protein from the sea has a value, a high value for the future. The world needs food, and the best place to find it or to produce it is in the sea. We are gonna create more value out of our whitefish. VAP Sales & Distribution, Ivar, we will deliver strong improvements the last like the next three years. We had 2021, it was 620 million EBIT. We haven't taken out the potential and all of the investments that we have done in this segment. We have a huge growth opportunity, and we have a target of NOK 1.25 billion in that segment. For the farming, I think Bjarne will talk about that target. How are we gonna grow? We need to know how to focus to grow. Where are we gonna in which path growth levels. We have three paths. We have a strengthened core that's being better in what we do every day. It's not a lot of investments into that. It's improving. Strengthened core, it will be extremely important to increase the volume to our strategic customers. Be better in sales and production planning. We have huge potential of improvement. Use our value chain, 400,000 tons of raw material, use it through our own value chain. It's easy and at the same time difficult, but that's a clear direction. Biological production, Bjørn will come back, and sustainability in daily operation. People in Lerøy will understand what this means, I can tell you. Develop the core digital transformation and automation. You're gonna see the most modern filleting factory in the world. This one is extremely small. It's automated and huge with huge filleting capacity and also with the best digital solutions that's available today. We need to push that transformation. Coastal farming, Bjørn will come back on. New strategic customers. We need to be even better working out in the markets to attract strategic customers, and of course, more volumes into our value chain. Even we should farm more, we should fish more, or we should have suppliers that can that we can add into our value chain. That you will see more and more. Other species in farming will come in new growth platforms, new farming technologies, new markets, and Lerøy Ocean Harvest producing other species in the sea, like seaweed, blue mussels, and others. But that's, you know, the bigger innovations. We need to work in all these three levels. When it comes to, you know, to have a clear direction for all our employees and for investors, owners, analysts, you know, it's important for us to be more clear about our strategy, and that's why we also are here. We have a clear strategic direction starting on Lerøy Seafood Group and also with the same system in all three segments, Farming. You will see from Bjørn afterwards, Wild Catch and VAP, Sales & Distribution. It will be clear all the way out in the value chain, through the whole value chain. Everyone need to understand why are they, what are they doing? How is the priorities? What are the directions? With 5,500 people, of course, it's complex, and it's hard work. It takes time. It really takes time with the value chain that we have. We know how to do it. Again, it's really hard work from top all the way out. We have clear targets and KPIs. I have and the management. This is a farming example. The farming segment, clear goals. Lerøy Midt, the regions that you are here, clear. All the way out to operation manager on locations and technicians. They need to follow. It needs to be connected. The goals need to be connected to the main goals. Everything we do will take us in the direction of reaching the goals. Then our strategic priorities. Here is five. For me, you know, these are extremely important. Because this I need to prioritize. Understand and meet customer and market opportunities. We are not, you know, we don't know everything. We can be much better. We need to be out with the customers. The customer, you know, it's the key. You need the best customers, and you need to prioritize to be out there with the best customers and support them. They need to see that you really do it. Increase operational efficiency. That's the improvements every day. How do we get more efficient? Reduce footprint. I talk about it every day in office and when we discuss things. You know, we come from a sales company. You know, 20 years ago, what was the most important wor d in Lerøy? DB. Yeah, but you can't sell it without the DB. Oh, what's your DB? You know, it was. You know, it's. Today, we have totally different discussions. Sustainability and how can we reduce our footprint. Four, create a learning and innovative organization. We need to have, you know, the value creative. We want to have people that work in Lerøy, they want to change things, to be innovative, and we need to help them. The last one, develop our people and our communities. Develop our people. It's, you know, 5,500 employees. We want to get the best out of our people. We need to educate the people. We need to support them, support the value chain so they can do the best. We cannot only buy machines and, you know, you think everything is running. I can tell you, this factory was not running the first day, not the second half of the year either. We cut the fish on the back and, you know, it's we need people to run it. Which kind of people do you need for this factory? Engineers, technicians, understanding of, data, analysis. The fishery, the seafood industry is not what it was 10 years ago. It's changing fast. We need to develop our people. With the communities also where we have a strong commitment because we are not only in Bergen. You will see that later. Also connected to these strategic priorities, we have strategic projects and a follow-up system of all the projects. We move and we prioritize the right projects. All the projects that we do will help us reaching the goal. Number one, the market and understanding the market and working with customers. It's not only selling and buying. That's easy. How do we solve a customer's pain? This is an example of NorgesGruppen that we started in 2005. It was a big problem in Norwegian retail for fresh seafood. The quality was terrible. They had, you know, weekly they were in the newspapers because the quality of the seafood were so low. When we started at the project, how can we solve that pain for the customer? It was fragmented. It was a lot of suppliers. The quality was not good. The traceability was not there. Taste and convenience was not there, and the profitability for the customer was terrible. Our solution or together with the customer reducing numbers of suppliers. They went from more than 40 to one with clear goals. Go from seven days from sea to shop to 2.2 days. We managed to do it together with the customer. Control logistics, traceability, and category development. The result. For our strategic customer, we need to secure that they are the winner in the market. Here you see on seafood, they have more than 50% market share, and the retail share is 43%. This we do in all the main markets. Our goal is to create value for the customers and that they take market share and that they are a winner. Our ambition, it's strengthen our strategic customers' competitiveness by making an efficient and sustainable value chain all the way to the shop. Increase product range and depth with existing strategic customers. Establish downstream units in the target markets. We have already done a lot, but there are still in some markets that we can do more and also some new markets. Increase value creation per kilo. We need that if we're gonna reach our goal of being number one value chain for salmon. In 2021, our share was 49% from strategic customers, and in 2025 it will be 70%. This transformation, we have a strong focus on that transformation. We cannot trade a whole fish. We need to use our value chain, and we need to work with strategic customers. It's a clear direction. Operational efficiency, Lerøy Way. You probably heard of it. That's our approach to operational excellence and continuous improvements. We need to build a system that everyone understands, and we do the same in the whole value chain, in the whole company. Lerøy Way provides a clear understanding of our situation and improvement areas. Where are we? Where are we good? Where are we not that good? Where can we improve? Make clear targets and objectives. Define clear roles and responsibilities, and then standardize and best practice risk management and work with continuous improvement. That needs to be built into the whole value chain. In the farming, all three regions are underway and implemented it. It's fantastic. I think it's the first farming company that implemented this kind of business system. For the whitefish, all the whitefish factories implemented it. Lerøy Havfisk, the fishermen, there is still a way to go, but it will be implemented also on our trawlers. VAP, Sales & Distribution, it's a lot of companies, a lot of markets. We are on our way, but we still have a long way to go. By 2025, the whole company will work in this system. Also looking at, you know, we have targets for improvements, initiatives, big ones that makes us better. How do we solve problems? We look at problems, we don't solve them. In Lerøy, we will solve them, and we need that culture, getting better, improving. Everyone needs to understand how we're gonna do it. One example, NOK 12 million is not, you know, a huge number for you guys. But for one factory, whitefish factory, it's a big number. This is an example from one of the whitefish factories. Started with Lerøy Way in 2020 and it's fully implemented today. We score the operation management and the data-driven decision. We have a Lerøy Way revision going around, see that the factories are doing and using this method and give them scores. We see huge improvement in this factory. Annual cost saving is twelve million, more than NOK 12 million. This is only a small example. We have a lot of factories in the whole value chain. Think of farming. We have huge potential of improvements. This is extremely important. The sustainability, the environment. Like I say, you know, it's not enough that I only talk about it. It's about understanding where we can impact on daily operation to understand, you know. Look at this one. It was finished today. Electrical system for the wellboats. It's a small thing. It's extremely important to also do the small things. Of course, we focus a lot on the big things if we're gonna reach our goal. We need to understand the value chain and which part of value chain where we can improve. This we do. Think of it, for the customer perspective, working with a company like Lerøy, they see that we where can we do it? For a customer working with many middlemen, this will be impossible. That's a fantastic opportunity with our value chain to really help the customer reach their goal. Everyone working in our value chain needs to understand this. You see that in Lerøy Midt. I can see after you have a journey tomorrow, you will see that, how they think. Our mission, we have set the clear targets. We need to see where we have the highest impact and of course, scope 3, feed and transport to the customers. We mentioned our ambition of 46% reduction. Sustainable fish feed. Can we? You know, we are not a fish feed producer, but can we do something? Yes, of course, we can. We need to work together with our partners on the feed. They need to come up with clear plans of how they're gonna reach our goal. They will, I can promise. Focus area sustainable feed, airborne transport, alternative fuels and some main focus areas. Some examples, sustainable fish feed. We believe that we are able to produce 100,000 tons of seaweed in 2030. We know how to do it. We've done innovation for 10 years together with Bellona. We know how to produce the whole value chain of the seaweed. We know that we can do it technically, but what is the biggest problem? Locations to produce. There's no one from political side here, but you know, we have space in the sea, you know, to produce fantastic seaweed and also blue mussel. It's a fantastic story, and that can also be used in the feed. Airborne transport. In the future, we will not transport a whole fish with head and backbone and everything. It's fillets. If we're gonna continue with airborne, we need to reduce as much as possible and fillets and also with the dry ice, not the wet ice, to reduce the weight. Then we work on a green shipping program. Lerøy Havfisk looking at new technology, and they are really motivated. It's a long way to go, but it's maybe four, five, six, seven, eight years, I don't know. We need to work on it, and we need to push that direction. We are the biggest seafood company in Norway, and we can make a difference. We can push the suppliers to come up with technology. Then I mentioned our 5,500 employees are crucial for our success. It's so important. It starts with being attractive. We need. You know, this is a young industry. It's an industry with, you know, it's a high speed of innovation now. We need to get young talent with the right competence. Like six, seven years ago, we, it was impossible. Everyone wanted to go into oil or to consulting. We needed. You're laughing. Yeah. We needed to be more attractive, the seafood industry and Lerøy. Today it's a totally different game. Lerøy is attractive. The seafood industry is attractive. Still we have a long way to go. We use a lot of time on trainees and internship and student collaborations to get the right competence into the group. We have a lot of good experience in the company, but we need to connect the experience with the new talents. The talents are the future for us. We are talking about building a company for eternity. It's our task to secure that it is for eternity. That starts with attracting the right talent that can solve our problems for the future because we have some problems to solve. It's our leaders. Do we have good enough leaders in the company? We have a lot of potential for improvement. We started two years ago a leadership program together with the NHH on Norwegian School of Economics. They really have good programs that especially connected to our value chain. It's a program that we started two years ago. 160 leaders completed the training, and we have 110 leaders in program at the moment. I'm a part of the program. We discuss strategy, we discuss problems, how to be better and it's a fantastic journey with the leaders and the feedback is extremely good. We connect the value chain because it's not only the farming part, it's the sales part and the logistic part and the economic parts and they talk together. This is how we're gonna, you know, make the value chain flow and to understand the whole value chain for all the employees. Then we have a competence program which is also extremely important to give in new competence. Things are changing and we need to be on top of that all the time and to secure that our employees are there. Then it's our communities. We have heard, you know, so often that we, you know, so in media that we don't support the communities, that we don't create values for the communities. It's not right. We are the biggest employer in north of Norway with the farming operations that we have and the whitefish operation that we have. I can tell you, every day I feel the responsibility of the local communities. What would Hitra be without Mowi and Lerøy? What would Frøya be without SalMar? There probably wouldn't be any schools there. We have a huge responsibility in what we do, and create a community where everyone can live with the different backgrounds and competence levels. This industry is fantastic, and you're gonna see it this day. Yeah. We have four more minutes on time. Seems like Sjur, you are good in planning. After we show you have a little bit. Loosen up a little bit. You can stand if you want. We have some rock and roll, and you see some. It's a homemade slideshow from our value chain, and especially what we do at downstreams, and which we are extremely proud of also. Next time it might be somewhere in Europe. We're gonna show you what we do out there in the markets, and you can look forward to that. Here is a small pitch of that. Ready? Yes. Go, go. Go. Oh, yeah, we of course this one, you know, this one is gonna follow me, follow me the next three years. Definitely. I'm ready for that. Then we go. Yeah. That was exactly one hour. We are on time, Sjur. Then we Sjur? Just final questions. We're gonna be, yeah, it's the final part with some questions. We also probably got a lot of questions on the digital platform here. I think you are all here. We want to prioritize you and your questions. We have a microphone and Hans will go around. Hi, Alexander Aukner from DNB. Could you maybe tell us a little bit about the advantage you have with the retail customers? As you mentioned, you build long-term relationships, and you want to move from 49% strategic customers to 70% by 2025. What does that really mean in terms of margins, return on capital employed, et cetera? Yeah, I think we can talk a little bit about the margins first. Yeah. What it means is that when we work with the strategic customers, we use our value chain. We have capacity in our value chain, and will of course have a strong impact on the margin in what we have invested. Trading seafood, it's extremely low margin on it. Of course we with the VAP and what we do there, it should be a higher margin than a trading margin. Of course, getting volume into our own value chain will give us better lower cost per kilo and also a possibility to improve the margins. I don't know if you have anything you want to add, there, Sjur. I think on the margin side, you see it's right, pretty aggressive target up until 2025 in the downstream operation. We have invested a lot downstream recent years. We have a lot of new factories. As you know, when you have a fixed cost base, if you add activity, then you get margin. It's kind of like adding more activity into the factories we already have. Selling a broader and broader product portfolio, we will be able to increase revenue. We should be able to increase the value creation on every kilo. We think that over time, our business model is a winning business model, which means that we should be able to expand to more markets also. The NOK 1.25 billion target in the VAP downstream, that's a combination of margin increase and sales increase? You saw Henning show the growth figures. Our ambition is to continue to grow. If you, we didn't set the revenue target for 2025, but if you say, for example, NOK 35 billion, then you can look what is the margin expectation as an example of 1.25%, and then you can say, where have you been historically. There is expectation of both growing revenue and increasing margin. Just one final question from me in terms of the return on capital employed target of 18%. Which parts of your business is above, which are below? Or asked otherwise Yeah. What areas do you have the biggest upside potential to that target? I think it's a good question. It's also a complicated question, because the core idea is kind of like the value of the system. When we add more farming volume, we're going to add value all the way. Also if you look downstream, it's extremely challenging to be a separate downstream player today if you don't have security on the volume. It's obvious we do it, but I think it's easy to calculate a little bit wrong when you look at one segment separately. If you look at our segments separately today, we have a good return above the 18% downstream. We are cyclical in the farming side. Whitefish side, we're not there yet. Thanks. Carl-Emil, Pareto. A little bit follow-up on Alex's first question. You mentioned also that maybe to be in the spot market have been correct the last years, but did you think in the future you need to have strategic partners? How will you make sure that you kind of get well enough paid for your product also in kind of markets where the price is very strong? Because you basically also say that the growth in farming volumes will not be fantastic going forward. I guess the market will be strong also in the coming years. Will you make sure this kind of also hits your bottom line? Yeah. We had a very special first half year. I have to say that with the extreme spot market. You know, it's being connected to the right customers for the future. That's extremely important, like I've said. You know, we need to focus on long term and long-term pricing also. You know, to grow markets, you don't grow markets when it's ups and downs. You grow markets when you have stability. Of course, you need to find the right levels, you know, on a more long-term basis. You know, in the long term, you know, it's right to have stability, I believe, for our company and for taking out the highest value in the future. I think it can be, you know, the spot market probably gonna be smaller and smaller, because of the total market for seafood is expanding a lot, and especially the retail. There is a little bit different situation. We believe in the long term. Of course, we need to find the right long-term price, which is the right one, you know. Of course, that's a challenge, but yeah. We cannot have the value chain, you know, up and down all the time, you know. We need to secure that we at least have a base that is long term. You feel that your customers are also willing to pay a higher price to have this stability, especially in, let's say, weaker spot market? Yeah, I will say that it's never been, it's been a very tough situation for many the last half year with extreme fluctuation and extreme high prices. I think it's the customers understands that the prices will come up, you know, in long term. All other properties are coming up and but it's the supply and demand that tells the price. It's more about how do we secure that we have the right level. You know, if you go to the shop it's not the weekly price, you know? That's not how you grow category. You know, it's so but, yeah. Obviously we do not set the price. The markets set the prices, the supply-demand balance. Everything we do is to increase demand. Kinda like the way to secure long-term high prices is obviously to increase demand. I think in what Henning just presented is showing how, what do we do to increase demand. There's a lot of potential there. Sindre Sørbye, Arctic Asset Management. This billion ambition, can you give us indication about more conceptual or you have been thinking about that, volume, value upgrade, so to speak, and also if M&A has a role in that ambition? Yeah. Of course, M&A will also be a part of it. It can be a part of it. It needs to be connected with our development in the whole value chain. Number one is that we have, like I said many times, you know, huge potential in the value chain that we invested in, you know, capacity. Instead of selling whole fish, you know, selling smoked product, sushi piece, totally different, not a whole cod. Selling maybe a dried cod or cod in a soup or, you know, to create value out of the raw material that will give growth. Then growing with the customers that wants to have, you know, these kind of products. Out in the markets, we have a lot of potential of expanding, so of course with a good turnover. Our value chain, you know, it's for partners. We are not only selling our own fish. We have partners. We sell huge volume that's integrated into our value chain, produced in a Lerøy Way, product with the feed and the same quality standard sold as a Lerøy Salmon brand. We will connect more and more from other suppliers, smaller suppliers, because it's extremely hard for them, you know, to operate how it is today and definitely how it's gonna be for the future. To attract more volumes coming in will also be a part. Other species will be a part. We need an 8% yearly growth to reach that goal. Okay, I'm a sales guy, you know, 8% is not that much for me. You know, the whole value chain need to be creative and, you know, find new business solutions and you just, it's possible. If I may just follow up on that. Already within the 2025-time horizon, I mean, you have pretty ambitious EBIT goal targets. Should we also think that at least some part of that improvement comes from third-party volumes being sourced into the downstream operations? Cause, I mean, if you have this... [crosstalk] Yeah. All in computation, then that will. If you divide it only on your produced numbers... [crosstalk] It will go into the sales and... [crosstalk] Exactly. Distribution segment, you know. It will make that stronger. Yeah. You know, and you see, you know, we have sea bass, we have sea bream, we have turbot. We are probably the largest company selling halibut. We are, you know, we are a total supplier of seafood, so we connect also other species. We are not farming it ourselves, but maybe in the future. That's in, you know, on the growth platforms, you know. It might be that we will go into these species and farm if we can give some value to that. It's a lot of opportunities. We are a seafood company, not only a salmon company. That's important to remember. When you come out and see what we do in the markets, then you will understand. You saw a little bit of it, but you know, it's yeah. It's in all areas in a way. Thank you. Yeah. John Binde, Fearnley. Can you say or something about your view and your potential interest towards land-based and offshore salmon farming? Yeah, I can say that. It will come in the next presentation. Is it all right, Per? Nils Thommesen, Fearnley. Just on the NOK 500 million EBIT target you have for wild catch. We've seen quotas going down, and the recommendation for next year is down as well. Can you say a bit of what the basis of that assumption is considering quotas? And also on the sourcing situation with Russian volumes, probably many buyers shying away from that. Is there sort of some margin expansion baked into your expectation from that, or Norway is more preferred region to source whitefish volumes from? Will you take it or... [crosstalk] Yeah, I can answer. No, I think there is some margin expansion into that. We have a large trawl fleet, and we have a large network of factories, and we need to be able to use those factories better and to add value to the product. From that, we will see higher margins. When it comes to Russia, yeah. I think competitive position in the cod market is that not every customer would like to buy Russian-sourced product, and we're probably seeing that a little bit in prices already. That's not the core driver for that objective of NOK 500 million. On level of quotas, it's difficult for us to know. Quotas are going up and down. It's a scientific process, which we obviously support, which is, we are highly dependent on long term, good governance of the quotas. They are going up and are going down. Again, it's a little bit like, what is the value of the market? Is it divided in price or volume? What you can see in the cod market in general is that the demand side is not developing as strongly as for salmon. For salmon, we've seen 10% annual demand growth every year for 20 years. And the whitefish market hasn't been anywhere near it. There hasn't been any demand development for the whitefish. What you see today is, very simplistic. When the quotas go down, prices go up more or less the same. What we need to make sure over time in that is that demand is growing, and we need to do that by utilizing our factories and develop the product. Christian Eiberg. Baseline figure 21. Of your NOK 23 billion, roughly how much is then not from your own value chain? The sourced part, externally sourced part. I don't have the... [crosstalk] 20%. I don't have the exact percentage. I think it's in the farming segment, it's basically volume times price, and then you get the number the same in the whitefish. The question is where do we add value downstream on which products. We don't have the exact figure to give. If you look about into volumes, we are doing somewhere between 350 and 400,000 tons of seafood. Of that, close to 200,000 tons is our own red fish. We have around 70,000 tons whitefish on own quota. We buy through the factory networks from 30,000 to 40,000 tons. But for simplicity, some 270,000 tons is our own. The difference up to around 400,000 to ns is then external. It's a significant share of revenue. In general, we add more value to our own product than the third party sourced. Christian Nordby, Kepler Cheuvreux. You have a pretty ambitious EBIT per kilo from farming and VAP being number one. Is that Norway total, or is it per region? That's the first question. Second, I know you're saying in the other presentation that you want to see costs down quite a bit. Will you give quarterly farming cost updates so that we can follow your targets there? Or how often are we gonna see updates on your actual cost development? No, I think Bjarne will get back to what we are going to do in farming on the cost side. We have already touched upon what we are going to do to increase margins in VAP. Again, kind of like core of the strategy, if we are the world's most efficient and sustainable value chain, we will be able to add more value to every kilo of seafood and also salmon than the rest. Kind of like that target is then a reflection of the strategy. If we succeed, we will be number one in getting margin out of every kilo of salmon. The target is for Norway. We'll get back to how often we update, but we will give updates on these targets in the years to come. Hi, Wilhelm Dahl Røe, Danske Bank. New markets is a core part of the new growth platform. Except for expanding into UK, do you have any specific plans or aspirations beyond that? Yeah. It's you know, in Europe, we have a strong position. We to cover actually the whole of Europe. Of course, you have the US market. It's an interesting market. It's at the moment the fastest growing market of salmon the last couple of years with a huge potential and of course the US market is an important market for us. Of course, we process a lot of the smoked products going into the US and also to Canada. We have good partners in the markets and in the future it will not be a shock if we do something strategically in the US. It's a huge potential for seafood in general, of course we are following that. Of course, UK is more concrete and there might be some opportunities also in Japan. We have a very strong position in the Japanese market with the long-term oriented customers we worked with for 30 years. You know, also the Japanese market might change the system. Like it has been in Japan, historically, we haven't felt that we could play a good role in the development of the Japanese market, you know, as a processor or you know. But as a partner in development and of the brands like Aurora Salmon and all this together with our partners, it's been. We've been having a good position. For the future it might change, you know. Japan is a good market. Korea might be also a market with a lot of potential. We are looking around, but the main focus the last 10 year has been Europe and we have done a lot. Yeah. Ivar can tell a little bit more about that afterwards in his session. Feel free to ask questions there. Yeah. Hi, it's Alex Sloane from Barclays. I've got two questions, if that's okay. The first one, just in terms of the NOK 50 billion revenue target, the 8% growth that implies out to 2030, what do you think would be the corresponding CAGR or growth in your capital employed over that period? That's the first question. The second one, just in terms of the increase in the share of revenue from the strategic customers getting to the 70%, will that increase your customer concentration or can you achieve that by adding new strategic customers? Thanks. Should I take the last one first? Yeah. Yeah. It's the strategic customers. Of course, the strategic customer are larger. They are huge, you know, and normally. It will be more concentration. In a way that it will be in new markets and it will also be in some established markets that this direction will be there. Of course, you know, we come from having a lot of small customers and are on the transformations to more and more larger customers and a more concentration, but also more safe value chain. When it comes to credits and, you know, in the long-term partnership with the customers, but a different feasibility. You know, it's not day to day. It's more like long-term oriented planning. It's important for sales and production planning is to have long-term fewer customers. It's challenging to give a perfect detailed answer to how capital employed will develop up towards 2030. I think what we presented is historic CapEx, and you'll see that we have a level of rolling maintenance CapEx, including smaller improvement projects, so some NOK 800 to 900 million. To get to NOK 50 billion, we will also need to invest in growth. The CapEx of that growth is a little bit dependent on, for example, buying growth in farming today is high CapEx, obviously, whether it's licenses or if it's developing the licenses. Other species could be cheaper. I think as an overall target, our aim is to grow capital employed at a lower rate than the CAGR, so less than 8%. You can see where we are today, and that's somewhere in the range of NOK 1.5 to 2 billion a year. So at least that the aim would be to be NOK 1.5 billion, would be to have a lower growth rate. Martin Kaland, ABG Sundal Collier. You mentioned that you have invested heavily and, yes, you will continue to invest in growth opportunities, and that makes sense as long as they give more than 18%. You haven't touched upon or highlighted your capital distribution policies that are unchanged. You have paid out rather large payout ratios the last couple of years. How is that trade-off, and how do you view that going forward? I think it's. If you look at the history, it's always been a balanced approach to using capital. Lerøy has paid out a dividend, I think, every year since 1994. We will continue to pay out the dividend. The dividend policy is in the range 30% to 40% of earnings over cycles. Last 10 years, we've been a little bit higher than that. I think that's a good starting point. Then we will employ capital into improvements in what we have and also to new growth platforms. It's a little bit of everything answer, but that's also what the history shows. It's been a balanced use of capital, and we will continue with that approach. Okay. I think we have two more questions. Great. Herman Dahl, Nordea. Just to understand the strategic partnerships or customers a bit more, could you say something about the long-term price achievement in the strategic partnerships versus the non-strategic customers, if you could call it that? Just to understand the dynamics and maybe also the value creation and your value capture of that value created for the strategic customers. No, it's more long-term. It's a lot of the pricing is one-year contracts. Some contracts can be like tunnel contracts with some fluctuations, but with a top and a bottom. Mostly it's on long-term contracts, like one year, to be able, you know, to have the stability to grow. Like I said, you know, to have a weekly pricing for that. Most of the non-strategic customers, that's on a weekly pricing. The partnerships, they are more on a long and on a yearly basis. My question is, was maybe more related to if you are able to capture some of the value if there is. If you can see that over time there is a price difference, price achievement difference between the strategic customers and the non-strategic customers. If you go back and you look back, you know, it's not like we do silly contracts, you know. Of course, you know, the last half year our contracts has been well above maybe half the spot price when the price was NOK 130 maybe. If you look the last years, you know, the contract levels has been higher than the spot levels for many years, maybe two, three years. Maybe two years. It's you know. Of course, you know, you don't get the tops and you don't get the bottoms. You get more a predictable earnings. You get a better prediction, a better planning in the value chain because you know what to produce all the time, you know. It don't fluctuate. So that makes it easier to work on improvements, you know, in the factories and distribution centers that we have and to have stable volumes through the value chain. That will, of course, have an effect on the profit or the margins. Yeah. I think to add, so kind of like the strategy is not to have the highest contract price. The raw material price needs to be right. Then the question is how much can you get out of the raw material, and also how can we optimize the value chain? Obviously, the fish is not sold as a whole fish in Norway. How can you utilize factory capacities like we'll see tomorrow, factory capacities in the end market, and how can we get a product to the consumer which is cost-efficient and innovative? Out of that comes the margin, not the contract price itself. I think we are seeing examples of that. When you work long-term together with customers, you are able to build more efficient solutions. Again, that's visible in the end that our customer take market share. That's the key for a strategic customer. It's not the exact spot price from week to week or it's do we help them take market share. It's exactly 1:30PM. It's break. In 50 minutes we will be back with farming and Bjarne Reinert. After that, also 30 minutes answering question- and- answer. Yeah. There is a lot of air here at Hitra, so please use the balcony. There's coffee on the way out if you like to get some fresh air. The balcony is back there. We'll start. I'm very happy to be here, and I'm very glad to see you guys here at Jøsnøya, our fantastic primary processing plant. Head office at our operations in central Norway and in the heart of one of the most productive farming regions that exist s globally. My name is Bjarne Reinert. I'm Chief Operating Officer of Farming, and I will spend the next hour, give or take, to talk about where we are, about our objectives and the strategy and the prioritizations we've made to deliver on the strategy going forward. Before I do that, I would like to remind us all on the fantastic growth journey that we've had in the farming segment in Lerøy. Starting off back in the late 1990s. A journey that's marked by several strategic acquisitions, by several strategic investments, and by a continuous effort to always optimize the assets and the resources that we have. This has brought us from a volume of zero back in the late 1990s to a volume of close to 187,000 tons in 2021. We have a capacity of close to 120,000 tons of maximum allowed biomass, and we are operating approximately 100 farms along our fantastic coastline from Rogaland in south and all the way up to Varanger in Finnmark. Our activities are structured into three regions. We have Lerøy Sjøtroll operating in west, and the managing director of Lerøy Sjøtroll, Nina Møgster, is present. Nina, raise your hand. Here today, we have our operations in the area Midt with the managing director, Harald Larssen. Raise your hand, Harald. We have operations in production area 11 in Troms and 13 in Finnmark. Kurt-Einar Karlsen, you are the managing director of those operations. This is a fantastic value chain. It's geographically separated, and that's a strength to our business. Mostly due to the fact that this structure increases our biosecurity and also due to the fact that this structure with operations both in south, mid and north gives a more stable volume from our operations. Henning was talking about the strategic customer, and this structure is quite suitable when we are delivering stable volumes to our customers. While having this structure, we are of course hunting synergies from our operations. We are in control of most of the critical processes from roe through the smolt phase, through our own production of in the grow-out phase and our own control of the primary processing. This gives us a fantastic opportunity to optimize and to strengthen our operational efficiency going forward. We have grown significantly during the latest, well about 20 years, but we have also had significant growth during the last three years. This graph shows the growth from 2019 and until 2021. We've had a growth annual growth of 9%. If you look at the graph to the right, you could see that our growth is quite good compared to our peers in the industry. It's close to 9%. The volume expectations for this year is lower than last year. We will deliver a volume of approximately 175,000 tons. The reason why this volume is lower than the last guiding is due to the fact that we have had challenges in our Mid Norway operations and our south operations. We've solved those issues by slaughtering the fish, some of the fish at lower average weights in order to take care of fish health and fish welfare, which is key to our operations and drives long-term sustainability. If we look at figures on a regional level, you could see that largest growth, we've had the largest growth up north with 16%. We've had a growth of 8% in our western operations in Lerøy Sjøtroll, and we've had a growth of 6% during this period in central Norway. Fish farming, that's all about biology. It's about creating the conditions that makes the fish thrive because the fish that thrives is a fish that performs. It's also about details because often it is the details that differentiates a good performance from a great performance. To know those details and how they affect the outcomes that we are hunting, that's key to drive in operational efficiency. If we look at group level or divisional level or company level, we have some value drivers that are determinants, key determinants to our operational efficiency. It's the growth rate that is key because it's driving our turnover rate. If you have a fast growth rate, you will also be able to reduce the exposure to biological risk in sea. Having a high growth rate, that is key to our performance. You have the survival rate, and that is key of course, because losing fish reduces our efficiency. We need most of our fish to survive. We need good health, and we also have an ethical obligation in taking care of the fish. We have the utilization of our maximum allowed biomass. These licenses that are our most costly assets, and we need to utilize these licenses to the maximum in order to drive operational efficiency and profitability. The quality of fish is key to our performance in the market and indirectly to our performance in the grow-out phase. These value drivers are top of mind. They are our must-win battles. When we decide on initiatives, when we decide on projects, we always have our minds related to these four key must-win battles. If we look at our ability to utilize our most scarce and costly asset, it has increased during the last years. This is our production per kilo of available maximum allowable biomass. It's heading north. That's good. It's heading north in all our three regions. That is also good. We perform above average in all the three regions where we operate, and that is good. We are not satisfied with these results. We believe that there is a huge potential in further increasing our ability to utilize our licenses, and going forward, this will be one of our key priorities. If you look at the cost level in our farming segments, you see the cost levels during 2019, 2020 and 2021 on this graph. You could see that we have had a quite significant growth in cost, especially in Region North. The reason why we have had this significant cost increase in Region North is due to the fact that we have been suffering from ulcers, winter ulcers, both on small fish, just immediately after stocking the fish and also on larger fish. We have resolved those issues. I will come back to that a bit later, and Kurt-Einar will also talk about what we've done as measures against this challenge. The cost in our production is related to three main levers. The first one is the biology. If you have good biology, you have better performance, and that reduces our cost. That reduces our fixed cost base per kilo. To produce with high operational efficiency is key to have control on cost levels in our operations. We have the fixed cost. We have a infrastructure in farming that is rigged for a significant higher volume than we have produced. To increase this volume is of significant importance to us when we are aiming at reducing our operational costs. The third one is inflation. We've had some inflation during this period related to feed as key driver and related to the processing as key driver. We've experienced significant increase in inflation costs, especially during this year. The energy cost is key to this increase in inflation costs. When looking at the average cost compared to the average in the industry, you can see that we are performing better than average nationally. We are performing slightly better than large companies. In this graph, large companies, this is from the Directorate of Fisheries statistics. Large companies is companies with above 19 licenses. We are performing better than mid-size companies, and we are performing better than the average of the small size companies. We see large potentials going forward in decreasing our costs, and that is key to our operations going forward. I would like to head in the front, looking at our objectives, looking at the strategy, and looking at the key priorities going forward. First, I would like to say that we are a growth company, and we will still be a growth company because we have a solid foundation for growth. Firstly, we have our employees, our people. They are our most precious resource. I'm incredibly proud of the people that we have in Lerøy. I'm incredibly proud of the work that they do every day in all kinds of conditions, because it's through their dedication, it's through their passion, and it's through their willingness to always perform better that we will succeed on delivering this strategy going forward. We have our value chain. We are in control of all the critical processes in our primary value chain. We have a structure that is robust, and we have a good base to build upon when we are working with optimizing this value chain in the years to come. We have the strategy. That's our sort of direction. It helps us prioritize. It motivates us. As you will see, we have a clear strategy and a clear direction for the organization going forward. We have set ambitious targets for the period to 2025. We will deliver slaughter volume of 205,000 tons gutted weight. We will deliver a superior quality of 93% and a slaughter average weight of 4.5 kg gutted weight. These are key performance indicators on our ability to achieve high price in the market. We will also reduce our economic feed conversion ratio. That is a key indicator on sustainability, and it's a key cost indicator to 1.19%. We will reduce our costs, our operational costs per kilo, measured in 2021 money, inflation held aside by NOK 4.6 per kilo. We have a strategy. A strategy with three levers, and the first priority is to strengthen our core. We will do that by focusing on operational efficiency, by focusing on these key elements, the must-win battles, the growth rate, the survival rate, our ability to utilize our MAB capacity, and the quality of the product or the fish that we slaughter. Always with cost and risk assessment in everything that we do. The second growth lever is to develop our core, and we will do that by increasing our effort to innovate new technology to implement new and more cost-efficient and predictable tools with regards to controlling sea lice and to be industry-leading on sustainability. Sustainability is, as Henning explained in his presentation, key to all the key decisions that we take, and we have embedded sustainability into our business strategy. The last lever is new growth. We will aim to develop technology for more exposed farming operations, and we will be in position on both offshore and onshore farming. We have a plan to execute on this strategy. This figure shows our strategic initiative portfolio, and this portfolio is something we assess regularly. We do it on a monthly basis, looking at the resources that we spend, looking at the milestones. Are we heading in the right direction? Do we need to reallocate resources every single month? These are the most key initiatives to drive our performance going forward. The targeted financial effects of these initiatives is in the span between NOK 800 million and NOK 1.2 billion. I will now look into three of the key initiatives that we have in this plan. We'll look into the work on process improvement. We'll look into the smolt. I will look into the technology. To start off with the process improvement, we have clear directions, we have clear objectives, and we have a clear direction of the way we are heading. It's through the everyday work that we do as an organization on site level and throughout all our units that is key to deliver on performance. It's about the processes, because high-quality processes lead to better objective achievement. We have three regions, but in essence, much of what we do in these three regions, it's the same. Through Lerøy Way, we will establish standards, we will establish best practices, and we will establish risk assessment throughout our organization by using some core principles. The first one is to improve and optimize our core processes, and most significantly, those that are related to our biological performance. Secondly, we need targets, and we have targets on every single management level throughout our organization. Thirdly, by distinct roles and distinct responsibilities. We always aim at solving our challenges, solving our problems at the lowest level possible, closest possible to the fish. By doing this, we will have continuous improvements through developing an organization that learns, that has a culture that is aimed at details and that is aimed at thoroughness in everything that we do. We believe that this will increase our efficiency. We believe that this will increase our engagement, and we also believe that this will increase our profitability going forward. We've already started. We started 1.5 years ago, so we are in the implementation phase. We've already seen some good results, and we have a ramp-up plan that spans all the way until 2025, where all 120 units in the farming division should have implemented this framework and these principles in a way that this is how we do things in Lerøy. This is how we work. This is part of our culture. We can look at one example. I was talking about the challenges that we've had up in our northern operations in Lerøy Aurora with winter ulcers affecting both small fish and large fish. We have used the framework we've had in Lerøy Way to implement measures that de-risks these operations. We've been looking at factors throughout our primary value chain, and we've implemented new best practices, not only in Lerøy Aurora, but throughout our operations also in mid-Norway and our southern region. These results has given us a 23% improvement in superior quality during the first two quarters of 2022, and it has reduced the mortalities related to our smolt in the first two quarters by 95%. We believe that these measures will give us a strength also going forward and better predictability related to our biological performance. I would like to have a bit of a look into the smolt and the work we do on the smolt side. There are two reasons why I will spend some time talking about smolts. The first reason is that we have invested significantly during the latest years to increase our capacity on production of smolt. The second reason is that we strongly believe that factors on the land side of our production in the smolt phase are key determinants to our full cycle performance in the grow out phase. If we look at the investments that we have done, we have Belsvik that you will be able to visit tomorrow and see with your own eyes. We finished the first step on Belsvik back in 2013. It's a RAS facility, recirculating aquaculture systems. It has a capacity of approximately 14 million smolts. We have Skjervøy, which supplies Atlantic salmon to our western region, Lerøy Sjøtroll. It was opened and finished in 2019 with a capacity of 20 million smolts. We have Laksefjord, and the third step at Laksefjord was finished in 2020. A fantastic facility with a great flexibility with regards to producing smolts on different sizes. Finally, and not at least, we have Belsvik 2 that's in close proximity to Belsvik 1. That factory will increase our average weight of the smolt in our mid-Norway operations, and the capacity in numbers are the same as the capacity in Belsvik 1. Through these investments, we have been able to integrate the smolt production as part of our own value chain. Prior to this, we needed to buy and source smolts from external partners. Now we are in total control of this production ourselves. We have reduced the number of facilities producing smolts from 31 back prior to 2013 to 10 facilities today. These are the largest facilities, but we also have six facilities that are a bit smaller with flow-through technology. We've also, through these investments, turned a lot of our smolt production from flow-through systems to RAS technology. These are all based on RAS technology. That changes the way we could stock the fish. That increases the flexibility that we have when we stock the fish, because with RAS technology, you could practically stock fish every month a year. In Lerøy, we stock fish into the sea phase 10 of 12 months a year. This flexibility is important for us because this increases our ability to utilize one of our most critical resources, our MAB capacity. It increases our possibilities to utilize our 120,000 tons of MAB capacity. We have also, through these investments, built significant expertise. We have built significant knowledge within constructing facilities on the technology part, on the production biology, and on operations. This gives us key capabilities. The survival rate for the first 100 days in the grow-out phase is reduced, or the survival rate is increased. Sometimes we're talking about survival and sometimes about mortalities, but the survival rate has increased from 91% to 98%. That is a significant increase. That increases our flexibility, and it increases also the capacity that we have in our infrastructure. We have completed just about 10 cycles of production from these facilities, and we experience varying growth results. Only 50% of the groups that we stock from RAS facilities performs better than average. We believe that there are huge potential in further increasing and strengthening the performance of the smolt, both with regards to the robustness of the smolt, its ability to cope with the challenges that the fish meet throughout the grow-out cycle, and also with regards to the growth efficiency. We will achieve this by using our onshore management tool. We have a lot of competence working with us on improving our protocols onshore. They're looking at salinity. They are looking at the temperatures during different phases of the production because temperature says something about the intensity of the production. They are looking at the light regime, the photoperiod that we offer the fish. They are looking at feed and feed composition. They are also looking deep into environmental parameters. Parameters like turbidity, gas content in the water, and the current in the water that we offer the fish. Through this, we will achieve a better performing smolt, a more robust smolt, and a smolt that performs better on growth rate during the whole grow-out phase. Through RAS technology, we are in control of all these critical parameters. This is a key initiative for us, and this initiative will eventually increase our capitalization on the investments that we have done and the investments that we might done, going forward. I would look into the third initiative from the strategic portfolio, the initiative on technology. Technology is already playing a key role in our operational efficiency and performance. I will look into the data analytics first and then into new production technology, because this will be key to performing better in the future. Digital technology and data technology will be of key importance to us going forward. We are working with the whole value chain of data, starting with the sensors and our ability to gain data from the fish and the environment flowing through the IT infrastructure and the way we are able to collect data, the way we are able to structure data to analytics. In Lerøy, we have a team of 12 analysts that only works with understanding data and making data available to our decision makers on an operational level. On a tactical level and on a strategic level. Through better data, through better quality of the data and through more data, we will gain more knowledge. If we have more knowledge, we will take better decisions. If we take better decisions, we will increase operational performance. The other track that's related to technology is new production technology. For us, there are three main aims at utilizing and developing, innovating new production technology. The first aim is to develop technology that makes it suitable and viable to produce post-smolts in sea as an alternative to the production of post-smolt onshore. The reason why we are aiming at innovating such technology, and the reason why this is so important to us is because this might reduce our investment cost. It might increase our capacity on larger smolts, and it might also reduce our operational costs related to the production of post-smolt due to the fact that energy consumption is a key driver to our operational costs onshore. The second area we are aiming at is shielding technology. Technology that makes our ability to perform operationally efficient due to better protectiveness against sea lice. Sea lice is a challenge today. It affects our operations. It reduces our ability to feed the fish. It reduces our ability to utilize our capacities. We aim at developing shielding technology to increase our performance with regards to sea lice and protect fish from an average weight of maybe 2 kg and all the way up to a slaughter weight of 4.5 g. This is quite costly technology. If you look at this figure to the right, you could see the farming volume that different concepts of technology on semi-closed, closed, and submersible systems can offer compared to the CapEx level of this technology. The open sea-based technology that we use in the industry today has a cost per cubic meter of farming volume that is significantly lower than the technologies that you see in this figure. This is not technology that we will utilize on every site in our site portfolio, but we will utilize these technologies in areas where we have biological challenges. At some of the sites in our southern region that are the lowest performing site, these technologies might increase our operational efficiency and predictability. On those sites, it might be suitable if we succeed in innovating a cost-efficient technology that has the effects that we are looking at. We could be utilizing this on some of the sites in our portfolio. The last area that we are working with is exposed growth. As an industry, one of our key inhibitors is our availability of farming area. There is a scarcity of farming area in Norway. In some of our regions, like in region west, Lerøy Sjøtroll, we don't have a lot of sites. The site part in our infrastructure is scarce. We aim at developing growth in more exposed areas. Today, we are operating farms with a significant wave height of up to 4.7 m with conventional technology. By modifying conventional technology and by utilizing new technology like submersible technology, it might be possible to acquire more efficient production area that is more exposed than the operations that we are operating today. That is the third element. The picture that you see to the left is our Preline platform. We've been operating this platform for just about seven years, last seven years. We've produced 12 batches of post-smolt. We produce two batches a year. We have gained experience, we have gained capabilities that we think is crucial when we are aiming at developing new technology going forward. New technology also improves or changes the way we work. If you are really quiet, you might hear the guys and girls sitting up on third floor feeding our fish in Trøndelag County. On the third floor of this building, we have a growth center that feeds Stignede 10 sites, approximately. A production of 35,000 tons are fed from the growth centers upstairs. This has been a really huge change for us. If you go back some years, all our sites was fed from the barges. We operated 100 sites and we had 100 people feeding our fish. By technology, we have been able to centralize the feeding. We have been able to build up expertise and competencies, and we are now feeding all our fish from such growth centers. We have one up north in the Lerøy Aurora. We have two centers in our central Norway region. One at this house at Jøsnøya, at third floor. We have one in Kristiansund, and we have four growth centers in operations in the western part of Norway. The other thing as an example of how technology might increase our efficiency and give us new capabilities is our pilots at Tussøya og Kurtøya in Lerøy Aurora. The aim of that pilot was to look really deep into whether we could innovate in such a way that we could begin farming with remote control for two reasons. The first reason is that if we one day go offshore, we will meet harsh conditions. Offshore, there will be conditions that does not make it suitable to have physical presence. To utilize technology in developing capabilities to remotely control farming operations is critical if we one day go offshore. Secondly, we believe that there are possibilities in utilizing this technology also in more coastal waters. This pilot is up and running. Kurtenar, we've been producing for the last, well, close to a year. The performance of the fish on this site, we have not concluded yet, but the performance of the fish on this Tussøya site is very impressive. We have very low mortalities, and we have a growth rate that beats most of our other sites. We believe that some of these increased operational efficiency that we see on this site is due to the fact that there are less disturbances on that site because we are remotely controlling parts of our operations. Now I will go into offshore. There was a question about both offshore and onshore farming. I will go into both of them and explain our view on these platforms. We believe that these new growth platforms might be viable over time. We believe that there will be a mismatch between volume produced and demand in the market, and that this will drive the prices and make some of these investments more better. First, looking into the offshore farming technologies. We have been looking into offshore farming for several years. We have been doing a lot more than just thinking about offshore farming. We have been working really hard on understanding the conditions, understanding the oceanographic conditions that we will meet if we one day go offshore. What happens when these waves goes through these platforms? Which wave heights might we experience? What about the currents in the water offshore? How does the temperature look? We've been looking at several areas of offshore farming, possible future offshore farming operations. We've been looking deep into how we are able to utilize our infrastructure onshore if we one day go offshore. We've been working a lot with the regulatory part, trying to gain predictability to any future possible investments offshore. We've been looking really deep into the technology. We have been developing technology or concepts on offshore farming together with external partners. The picture that you see up to the right is one of the concepts that we have developed that are designed to produce Atlantic salmon in operations up to a significant wave height of 14 m. You know that if you have a significant wave height of 14 m, the largest waves that you will experience in the harshest conditions during the harshest storms might be as high as 28, 29 m from bottom to top. This is one of the keys related to offshore farming. In our opinion, this is one of the key risks, what happens to the construction and what happens to the fish when these conditions occur. We consider offshore farming to have a compelling volume potential, and we will still follow both the technology development and the regulatory aspects of offshore farming to evaluate on any future upcoming opportunities. If we look at the onshore farming possibilities to grow our volumes going forward, we see that there are significant volume potential, but we also assess the technology to be on a quite low technology readiness level. It's still under industrial verification. We believe that there are huge risks related to onshore farming. There are synergies to the activities that we do in producing smolts and post-smolts on the same kinds of technology with RAS technology. We are producing close to 14,000 tons of post-smolts annually, so we have quite large volume of production onshore already. We do also lack experience related to key parameters onshore. We lack experience on biology, and most importantly, we lack experience on full cycle growth. How does the fish grow during the full cycle production onshore? We believe that the technology is expensive. We believe that if we one day go offshore, it might be more suitable to do that in overseas markets. We have no significant investments planned short-term for onshore farming. To sum up our look at different possibilities of growing volumes going forward. We see that the latest two themes that I've been through, offshore and onshore farming, it has quite significant risk in our considerations. The CapEx related to investments in both onshore and offshore technologies is quite high per kilo produced fish. If you look at possibilities related to license growth, it's quite expensive whether you acquire new companies through M&As or if you use the opportunities that lies in the regulatory framework in Norway. We see a large potential in further increasing our operational efficiency through better processes, through better smolts, and through new technologies. These are the investments that give us the best CapEx per kilo estimates. We will still focus to strengthen and develop our core, and we will monitor both onshore farming and look more deeply into both the technology aspects and the regulatory aspects of offshore farming going forward. We have the capacity to grow within our existing infrastructure. We do not need to invest significantly to grow to our 2025 targets of 205,000 tons. We are also having an ambition of growing beyond 2025. We are looking at several business cases. On the broodstock phase, we see that we have the capacity in our infrastructure for a significant growth, but we also have some limitations in our infrastructure. We're looking at a business case that both will increase our capacity in volume. It will increase our capacity related to high quality broodstock work. It will increase or further strengthen our biosecurity measures on the broodstock part of our production. We will take a decision on this business case when we have a business case ready, but the expected CapEx is close to NOK 500 million. We are also working with new investments in smolts. We are working with the project in our western operations in Lerøy Sjøtroll. A project that is aimed at increasing the average weights of our smolts in our western operations significantly. Project that will increase our volume, and a project that hopefully will increase also our operational efficiency in relations to our ability to perform on our key value drivers. We will have a business case ready by early 2024, and we will decide on that business case when the business case is assessed. In the growth phase, we see that new technology is beneficial and might be beneficial for us if we succeed in innovating new technology. If we succeed in innovating new shielding technology or technology related to the production of post-smolt in sea, or technology that's related to acquiring new, more efficient production area, more exposed, we will then scale up these technologies. With surgical precisions, attacking parts of our site portfolio to solve the issues that we have that are present. If we succeed in this, we see investments between NOK 500 million and NOK 1 billion during the next years. On the processing part, we have just started building increased fillet capacity at Skjervøy. We are also working with consolidating our primary processing activities in Region West. These investments are significant. They have a price of between NOK 600 million and NOK 800 million. They will increase our capacity, and they will increase our ability to utilize the whole fish and to deliver on the sustainability targets going forward. With these investments on the processing part, we will have significant infrastructure capacity to further increase in our production. We are really looking forward to this growth journey, and we will update you regularly on how we are performing on the targets that we have on the screen. With this, I would like to thank you all for being a part of this presentation, being present. Sjur, we are heading directly into the Q&A. Yeah. I think so. Yeah. I think we prioritize questions in the audience, so if there's any questions. Christian Nordby, Kepler Cheuvreux. Can you give some feeling on the regional volume growth, given your 2025 target? Yeah. Should we say the numbers? Yeah. Can you indicate at least? In Region North, Lerøy Aurora will have a growth up to 50,000 tons. In Region Mid, we will have a growth up to 80,000 tons. In Region West, we will have a growth, Nina, up to 75,000 tons by 2024. This growth will be organic. A follow-up on your harvest weight assumption is quite large in 2025. What's your mortality assumption? I won't tell you the numbers. It's indicated through the targets on the feed conversion ratio. As you know, the feed conversion ratio, this consists mainly of mortalities and the biological feed conversion ratio. What I can say is that we are aiming at significantly lowering the mortalities in all three regions. Carl-Emil, Pareto, can you say something about the inflationary pressure on cost this year and next year compared to 2021 to help us understand the cost reduction guidance of NOK 4.6 from the 2021 level? I think that's a question for you... [crosstalk] Yeah. Sjur. That guiding is without the inflation we're currently seeing. That NOK 4.6 is then based on input cost 2021 and cost level 2021. 2021 is baseline, and then NOK 4.6 from that. If you look into what is really happening on inflation, the impact is significant. The most obvious one is feed, and as we have commented upon in our quarterly presentations, we are seeing higher feed costs. As you know, feed is going through a live inventory in sea, so it takes time before we see the full impact. What we said is that if the feed price level seen at the start of third quarter were to stay at that level, the full impact compared to 2021 would probably be some NOK 6 to 7 a kilo in 2023. On feed cost. Those who follow the commodity prices closely, some of them have turned. There are some positive indications on feed costs. Hopefully we'll see a slightly lower level, and obviously a lower economic feed factor would be positive and kind of like reducing the actual impact. Beyond feed cost, we see inflation in almost any impact factor. The most obvious one is energy, where there is a big difference in energy costs along the Norwegian coastline today. That impact is being mostly felt in West Coast Norway, where energy prices are high. What's being felt along the full coastline is the cost of more expensive urea, which is a significant cost point. You see also then energy cost and oil cost into, too, for example, box cost. There is probably a little bit different from region to region, but in the NOK 2 range in addition to the feed cost. We see a significant inflation pressure into 2023. As commented in Bjørn's presentation and Henning's presentation, through operational efficiency gains, we expect to counterbalance some of this. Thank you. Hi. Alexander Aukner, DNB. Yeah, in terms of the superior share, 93% on the harvest weights, you obviously gave the targets. Could you just remind us what the 2021 numbers were? Yeah. The 2021 numbers was close to 87%. That's an increase in superior share of almost 7%. The harvest weights? The harvest weight of 2021 was 4.2 kg, so it's an increase of 300 g. Thank you. On the CapEx side, I'm assuming these additional CapEx you mentioned on roe, smolt, farming, processing, et cetera, that's in addition to the maintenance CapEx you guided at NOK 8 to 100? Yeah. Kinda like core idea of what we presented today is that the target is based on what we already have invested, and obviously there will be some maintenance CapEx. Yeah. That the project presented in the end would add to those targets presented. You mentioned on the smolt side, that's an early 2024 business case. It seems to me processing is probably closer in time. Then on the roe, could you give any indication on the timing of that? Is it towards the end of the period? No, it might be earlier. We are working, and we have come a bit far with the project, and the business case, so hopefully, a lot earlier than 2025. Okay. On the farming growth, the shielding technology, you said during the next years, so that'll be spread. That's a span because we are in the sort of innovative phase. We are testing different things. We are working with different suppliers, and this will be dependent on our success in innovating new technology. It will be dependent on our ability to scale these technologies. Okay, thanks. Final question from me on the roe side, on the smolt side. You said you had 10 production cycles, 50% are now performing better than before. Could you give an indication of what it was during the first cycles? How much improvements from the first cycles to 10 cycles? I don't have the figures in my head. But we have done work on optimizing every single day, every week, every year. We have increased the performance, but we are not satisfied with the performance, and we see a huge untapped potential in further increasing the performance from the smolt. We believe that these initiatives will give us a significant increase in our operational full cycle efficiency. Yeah. These efficiencies you're expecting from the fish which is in the sea today, or is that going forward from today? Yeah. That's gradual increase in operational efficiency. Thanks. One more question on the shielded technologies. Is it fair to assume that, if there are licenses that require shielded technologies, that is something that you will invest in? We are looking at every opportunities that there is to acquire more capacity. We also see shielding technology as an approach to reduce the risk of losing capacity in our western operations. We will assess every opportunity there is, and we believe that there is a strong potential in utilizing these kinds of innovations in parts of our site portfolio. Mostly in regions where we have recurring biological challenges. Yeah. Martin Kaland, ABG. What is your main constraints in getting to your harvest volumes and that license utilization you aim for? Is it smolt, farming sites, harvesting capacity, and is that also an indication of when we can expect the timing of the ramp up in volumes? With regards to the 2025 targets, we don't have significant constraints in our infrastructure. There is a small scarcity of the availability of sites, mostly in the Region West, to a certain degree, also in Region Mid. If you look in general on the capacities that we have in our infrastructure, we have the capacity to grow to 2025 targets. The most significant constraints are related to a predictable and cost-efficient control of sea lice, because sea lice disrupts our operations. It disturbs our ability to increase our growth rate. You know, the rate, the speed of the growth of the fish, because you need to treat the fish, you need to starve the fish, and these disturbances are key to delivering on the goals up to 2025. How is your sea lice treatment capacity and let's say, philosophy or strategy? Do you have the right equipment on the right boats, and how do you then aim at trying to secure that part of the puzzle? We are always working mainly with optimizing the capacities that we have with regards to treating fish. We have done some investments during the latest years. We have done also investments related to the processes on how we treat the fish. We have the capacity, but most of the work that we do on an operational level with regards to controlling sea lice is to optimize on the tools that we have. We have a plan for lice control that is running and operating, and learnings from that plan will continuously be developed as our best practices in all three regions. Asbjørn Reinkind. I have two questions. One is, with all you're doing now on better and bigger smolt and so on, this target on MAB utilization, what could be when getting everything optimal, what could be the theoretical target there? What could be. You're now up around 156% to 166%. What could be the real optimal target there, you think? The second thing is that in sea lice treatment, now you have different sorts of mechanical treatment and some, I think using something in the feed and so on. But what do you think about the development of vaccines or with the other pharmaceutical tools that will be available in the next three to five years? The first question, Asbjørn, was related to the ROAS... [crosstalk] Oh, no. What is the theoretical capacity? Theoretical capacity of utilizing the MAB capacity. I think there is no roof, or at least we don't know the roof. We see that there are potential for a significant increase. We have produced at an efficiency ratio of 1.56% at average level during 2021. Our aim or target, we haven't explained the operational efficiency target, but it is increasing over. The targets for 2025 relies on our ability to increase our MAB utilization further and significantly higher than 1.56%. We see that there are peers in the industry that are better at utilizing licenses than we are. We will work hard and thoroughly with all that we can to further increase our ability to utilize these capacities. The second question was related to the sea lice. We use many types of technologies, but most of the technologies that are used in the treatment of sea lice are mechanical approaches and freshwater. We have a portfolio of different types of capacities because that's important to have different types of capacities to be able to utilize the best capacity for the fish, at the time when you treat the fish. Sometimes freshwater is the best, other times heated water could be the best, and other times, using pressurized water could be the best. When we look at the portfolio of possible coming innovations, on the pharmaceutical side, I believe or I hope, at least I hope that, vaccines might be approved in time, but scientifically I think that's hard. I think we'll have... It's a long time before we'll have efficient vaccines against sea lice if we are ever able to develop such vaccines. There are being done work on the pharmaceutical side. The pharmaceutical companies are the best to answer that, but we see possibilities coming during the next years on different types of substances to treat the fish. Yeah. Asbjørn, was that the answer you was expecting or? I guess you can be more specific on theoretical MAB utilization and whatever. You will be able to reach 2.5% with the next, not in 2025, but later on. Yeah, if the average weights of the smolts is significantly higher than we have today, that might be possible. I think from a kind of like a theoretical perspective, if you want to maximize utilization, you should be at the allowed biomass at all points in time. From that, the question is what is your net daily growth rate? That net daily growth rate is basically our daily interest and is dependent on mortality rate or survival rates and also just the biological performance. Less sea lice treatment would help. What we talk about smolt will help. I think if you look on historic productivity growth, in Norway it's around 2% a year. We have set the target for 2025 in what we've said, and at least we should grow 2% from there. There are, Asbjørn, also large potentials in further increasing the efficiency through better genetics. That potential is increasing. Every year we get a new generation of broodstock into our production. But the thing is to utilize them to have a full lager. Inventory, yeah. Inventory at all times and have a high turnover rate on the fish at all time. That's the key to develop the delivering high efficiency ratio. Hi, it's Alex Sloane from Barclays. Just a question on smolt. One very interesting statistic you said, I think from the RAS facilities, the 100-day survival at sea had gone up to 98% from 91%. But at the same time, you said in the 10 cycles of production from the RAS facilities, only 50% of the smolts were providing better than average performance. Just trying to kind of square those two, because it sounds like it should be a lot better than 50%. Is that just a time lag? I guess, yeah, be interested in your thoughts there. That's the statistics that's done on the average throughout this period, approximately 10 production cycles that we have producing larger post-smolts. On average, 50% of the group that we stock performs better than average on the growth ratio. Okay. More recently, it would be higher than that? We have increased our growth rates recently. We are not satisfied with the results. They are not stable. They are not stable enough. They are not enough predictable. We see that there are large, untapped potential. We have control of the most critical parameters, salinity, temperature, environment, light regime, et cetera. By innovating these protocols, we will take out the potential. We don't know whether that happens tomorrow, or next year. Thanks. I think this will be our final question. There is some questions also on the webcast. We make sure all of those are answered by email. Okay. Thanks. Just to understand your improvement target of NOK 4.6. I mean, you presented this slide with where you have this estimated effect of NOK 0.8 to 1.2 billion from strategic initiatives. I mean, if you take the midpoint of that and divide on 2021 harvest, you get slightly above NOK 5 per kilo. Is that mainly those NOK 4.6 or shouldn't in addition be more like continuous improvements and efficiencies, or are those numbers more or less comparable? They are comparable. But you know, it's hard to know which effects we are managing to take out from the different initiatives. These are sort of considerations and analysis that we do prior to having done the work. It's right as you have described it, the average of or the midpoint of those 0.8 and 1.2 is around NOK 5. Hopefully, you're right, we'll have further increasing or decreasing, we will decrease our cost by more than NOK 4.6 due to other initiatives. These are our best estimates. Are those that billion realistic in a 2025 timeframe, or should it maybe some of it be a little longer out in time? Some of them might take longer time, but we mean that the goals and the targets that we've set for 2025 is realistic. Okay. Yeah. Thanks. Perfect. Thank you for all the questions. That finalizes the webcast of today.