Yngve Myhre, administrerende direktør i SalMar på Havbrukskonferansen 22. november 2011 på Radisson Blu Scandinavia i Oslo.

1. SalMar ASA
How to deliver margins trough low cost production in salmon
farming and value added production in Norway
CEO Yngve Myhre
22 November 2011
www.salmar.no

2. Content
About SalMar
Q3 – YTD 2011
www.salmar.no
Delivering margins:
– Farming
– VAP
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3. SalMar ASA
Northern Norway :13 licenses / 18 000 tgw SalMar Japan KK – sales
Central Norway : 58 licenses / 77 100 tgw including Segment Rauma
50% of Scottish Sea Farms Ltd. And 24,8% of P/f Bakkafrost
www.salmar.no
• Founded in 1991, Frøya, Norway, listed on Oslo Stock Exchange May 8th 2007
• Revenues 2010: NOK 3,4 billion EBIT: NOK 973 million 600 employees
• 71 wholly owned farming licenses in Norway. 80 including all partnerships
• One of the largest and most cost effective salmon farming companies in the world
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4. Built brick by brick ……..
120
Scottish Sea Farms (SalMars share)
100 12
SalMar Northern Norway
18
80
'000 s gutted weight
SalMar Central Norway 14
13
60 12
7
11
11
14 14
25 % annual
40
12
10
4
77 growth in volumes
10
12 3 3 50 51
20 10 45 42
2
2 3 30
17 23 22
9 11 13 14
0 7
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011G
www.salmar.no
33 % annual
growth in EBIT
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5. …to become an integrated salmon farmer
www.salmar.no
• Brood stock • Hatch, vaccination • 71 wholly owned • InnovaMar facility • SalMar Sales AS
and smoltification licenses
• Roe • Vikenco • SalMar Japan KK
• 7 production
• 80 including all
facilities
partnerships
• Genetics • Harvesting • SalMar Korea
• Essential for the
• High quality sites
• “Raumastammen” performance in the • VAP • Long time partners
entire value chain
• Fish health
• Scale, quality and • Global reach
cost
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6. Content
About SalMar
Q3 – YTD 2011
www.salmar.no
Delivering margins:
– Farming
– Processing and VAP
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7. Short summary of Q3/YTD 2011
Central Norway 3Q 11 YTD 11 FY 2010
Phasing in of InnovaMar in 2011
Operating income (NOK mill) 1 001,9 2 551,5 3 137,2
EBIT bef. value adj. biomass 127,1 379,8 733,6 Room for improvement. especially in VAP
Relatively low contract coverage (20%)
Harvest volume (1,000 tgw) 23,1 42,5 47,2
EBIT/ kg gw (NOK) 5,51 8,9 15,55 Strong growth, some biological challenges
Northern Norway 3Q 11 YTD 11 FY 2010
Operating income (NOK mill) 147,8 409,1 506,0
EBIT bef. value adj. biomass 10,0 121,0 211,2 All sales done in spot market
Harvest volume (1,000 tgw) 5,8 12,4 13,6 Steady cost levels
EBIT/ kg gw (NOK) 1,73 9,7 15,55
www.salmar.no
Segment Rauma 3Q 11 YTD 11 FY 2010
Operating income (NOK mill) 139,2 415,9 257,2 Most sales done in spot market
EBIT bef. value adj. biomass 9,2 70,7 66,8
Increased production costs in 2H 2011
Harvest volume (1,000 tgw) 3,0 6,9 4,2
EBIT/ kg gw (NOK) 3,06 10,3 15,92 Contributions from harvesting and VAP
Norskott / SSF 3Q 11 YTD 11 FY 2010
Operating income (NOK mill) 154,6 549,9 1 026,8
EBIT bef. value adj. biomass 20,9 130,9 279,4 Higher cost level than in Norway
Harvest volume (1,000 tgw) 4,5 14,3 27,1 High contract coverage
EBIT/ kg gw (NOK) 4,67 9,1 10,31
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8. Group profit and loss – 3Q/YTD
NOK million 3Q 11 3Q 10 YTD 11 YTD 10 Op. income in line with Q3 2010
– Higher volumes
Operating income 1 077,2 1 002,3 2 763,6 2 279,8 – Lower salmon prices
Cost of goods sold 665,1 477,3 1 571,5 1 106,5
Payroll expenses 114,7 83,1 270,0 204,6
EBIT NOK 134 mill
Other operating expenses 128,9 114,3 299,8 275,8
EBITDA 168,5 327,6 622,4 692,8
Depreciations 34,5 26,9 94,5 66,0 Negative value adjustment of
biomass
EBIT before biomass adj. 134,0 300,7 528,0 626,8
www.salmar.no
Value adjustment biomass -71,0 -48,9 -385,3 171,1
Income from associated companies
EBIT after biomass adj. 63,1 251,8 142,7 797,9 mainly 50% of Scottish Sea Farms
and 24,8 % of Bakkafrost after tax
Income from ass. comp. 30,8 13,2 81,8 81,5 results.
Other financial items -49,4 -22,4 -74,6 -54,1 – Share of EBIT SSF: -8,9 mill
Earnings before tax 44,5 242,6 149,9 825,2 – Share of EBIT Bakka: 38,9 mill
Tax 3,8 64,2 19,1 208,2
Result for the period 40,7 178,4 130,8 617,0
Other financial items include both
Earnings per share (NOK) 0,38 1,73 1,16 5,99 interest and currency effects
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9. Content
About SalMar
Q3 – YTD 2011
www.salmar.no
Delivering margins:
– Farming
– Processing and VAP
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10. SalMar has over time delivered “best in class”
www.salmar.no
Source: Pareto Securities 10

11. SalMar has over time delivered “best in class”
- 2011 more challenging with start up cost, and low contract share
EBIT/kg
18
16
SALM
14
12
10
www.salmar.no
8
6
4
2
0
4q06 1q07 2q07 3q07 4q07 1q08 2q08 3q08 4q08 1q09 2q09 3q09 4q09 1q10 2q10 3q10 4q10 1q11 2q11 3q11
-2
Source: Company financial reports 11

12. Best performing SalMar site 2005G
Production cost (live fish) pr. kg:
– Well below 11.00 (10,55)
– Equal to 15,38 gutted in box
Feed costs NOK 6,47 average pr. kg
www.salmar.no
Salary costs NOK 0,63 pr. kg
Administration costs NOK 0,35 pr. kg
Other operating costs NOK 0,28 pr. kg
Health & veterinarian cost NOK 0,06 pr. kg
Source: SalMar 12

13. Marked difference from best performing 2005G
to 2010 production cost levels
NOS Price 2010 : NOK 37,45
Estimated average production cost best performing listed
companies 2010:
– NOK 22,00 per kg gutted weight
www.salmar.no
– Average Norway above NOK 24 per kg (SalMar estimate)
Comparison
Top performer 2005 G Sample 2010 harvest Delta
Cost live weight 10,55 15,94 -5,39
Cost gutted in sea 12,71 19,20 -6,49
Harvest & well boat 2,67 2,80 -0,13
Cost gutted weight 15,38 22,00 -6,62
Source: SalMar estimates 13

14. Illustration of developments in key cost
components
Cost component Cost development Comment
(approximation)
Feed Costs + NOK 3 – 4 A product of price of feed and feed
conversion ratio
Health & veterinarian + NOK 0,5 – 1,5 Sea lice treatments, medicine &
vaccines, veterinary costs
Administration + NOK 0,2 – 0,4 Corporate HQ, listing costs, IT &
www.salmar.no
telecom, business support etc.
Smolt + NOK 0,2 – 0,5 Price, mortality rate
Harvesting + NOK 0,1 – 0,3 Charter costs, fuel, salary,
packaging, utilization
Other operating costs + NOK 0,5 – 1,0 Depreciation, insurance,
maintenance, salary , rent
Total + NOK 4,5 – 7,7
Source: SalMar estimates of development for the industry in general 14

15. What can be done to counteract this development?
Cost component Focus areas and actions to mitigate cost increase (examples)
Feed Costs Feed conversion ratio, selection of feed (feed composition),
commodity prices
Health & veterinarian Sea lice treatment: Wrasse, mechanical, less use of chemicals
Administration “Rightsizing” the organization, streamline IT & communications
platforms, effective business support
Smolt Size, timing, mortality rate, vaccines
www.salmar.no
Harvesting Volume, high capacity utilization, automation, flexibility
Reduce production time Feeding strategies, size of smolt, use of lights, fewer and
in sea effective treatments of sea lice
Other operating costs Centralized purchasing arrangements, efficient working
practices, high utilization of fixed assets
How much of the cost increase can be addressed?
NOK 2,50 – 3,50
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16. Content
About SalMar
Q3 – YTD 2011
www.salmar.no
Delivering margins:
– Farming
– Processing and VAP
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17. InnovaMar – a strategic and value creating
investment
Harvest and processing capacity The InnovaMar facility
Economies of scale
Optimize biological production
− Flexibility
−
www.salmar.no
Fish welfare
− Product quality
− Optimal use of raw material
Reduced need for transportation
 Investment of EUR 70 million
- 10 000 tons GW in august 2011  17 500 square meters
 Capacity >70 000 tons GW per shift
- Pre rigor processing online
 Capacity > 25 000 tons GW to filet
Handling of waste & byproducts per shift
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18. InnovaMar 2012 – Harvest / HOG
Key Innovations
Automatic stunning
Automatic in feed, gutting and cleaning
Capacity of 120 fish/minute
Direct flow to pre rigor lines
Automation and improved working conditions
Hygienic design of plant and machinery
www.salmar.no
Expected quality and cost improvements
Reduced handling and improved shelf life
Flexibility in use of raw material (fresh/frozen/fillet)
Capacity and economies of scale
Reduced use of man hour
Flexibility in selection of sizes to customers needs
Estimated cost saving of 10-20% compared to
industry average in Norway
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19. InnomvaMar 2012 – VAP
Key Innovations
Direct flow of pre – rigor raw material
Flexibility to produce pre – rigor and post rigor
volumes in three separate lines (50/50 share)
Total capacity of 50-60 fish/minute. >15 tons/hour
Traceability (organic salmon 2x125 grams)
Moving down the value chain
Product flexibility, with potential to sell volumes to a
www.salmar.no
less price sensitive market segment
Expected quality and cost improvements
Improved shelf life
Meeting to strict quality standards
Improved yield
Reduced need for transport (lower CO2 emissions)
Target of 100+ tones raw material per shift/day
Improve efficiency of 10-20% versus old plant
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20. Thank you for your attention
See www.salmar.no for more information
www.salmar.no
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