John Paul Mc-Ginley - CEO Morpol ASA - Salmon Demand in Europe
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John Paul Mc-Ginley - CEO Morpol ASA - Salmon Demand in Europe

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John Paul Mc-Ginley, CEO i Morpol på Havbrukskonferansen 22. november 2011 på Radisson Blu Scandinavia i Oslo.

John Paul Mc-Ginley, CEO i Morpol på Havbrukskonferansen 22. november 2011 på Radisson Blu Scandinavia i Oslo.

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John Paul Mc-Ginley - CEO Morpol ASA - Salmon Demand in Europe John Paul Mc-Ginley - CEO Morpol ASA - Salmon Demand in Europe Presentation Transcript

  • Morpol ASA Salmon Demand in Europe John-Paul McGinley – Chief Operating Officer Havbrukskonferansen, Oslo - 17 November 20111
  • AGENDA• Introduction to Morpol• Market update• Outlook2
  • THE LEADING SALMON PROCESSOR IN THE WORLD Revenue CAGR of 33%, strong EBITDA margin• Market leader in smoked salmon (Million EUR) 450 Revenue 20• Consistent quality 400 350 EBITDA % 16 300 250 12 %• Innovation leader salmon VAP 200 150 295 354 430 344 8 239 100 4 152• 72,000 MTs of raw material 50 105 0 0 2005 2006 2007 2008 2009 2010 YTD processed in 2010 Q3 2011• Over 3,200 employees• 22,000MT of salmon farming in UK• 7,000MT of salmon farming in Norway3
  • FULLY INTEGRATED BUSINESS PRESENT IN ALL MAIN MARKETS FOR SALMON Jøkelfjord Laks Waynor Trading Salmon Production Morpol USA Morpol UK Sales Office Purchasing office Sales Office Morpol ASA CorporateMeridianSalmon Laurin Seafood Salmon Production Site Production Morpol Main Production SiteBrookside Products Production Site Laschinger Seafood Sales office Morpol Japan Morpol France Sales Office Sales logistics and distribution centre Morpol Italia Sales office Laschinger Seafood Logistics and distribution centre 4
  • MORPOL MISSION & CORE VALUES• Mission • .....to be the most efficient producer of value added salmon products, exceeding customer expectations with excellent products that are attractive and convenient for consumers and food service. Morpol will continuously innovate in product concept, equipment design and food safety to set the performance standards for the industry.• Core values • Quality • Reliability • Innovation • Convenience • Value for money • Food safety5
  • OUR PRODUCTS6
  • MARKET UPDATE7
  • SALMON PRICES SPIKED IN 2009/2010 NOS Price - Average all sizes 50 NOS Salmon Price 45 Linear (NOS Salmon 40 Price) 35 NOK / KG 30 25 20 15 10 2002 2003 2004 2005 2006 2007 2008 2009 2010 20118
  • SALMON PRICES CONTINUED DECLINE Q3 Prices averaged NOK 26/kg in quarter NOS Salmon Price (Ex Oslo) - Average all sizes 50 2011 45 2010 2009 40NOK / KG 35 30 25 20 15 22 43 10 11 12 13 14 15 16 17 18 19 20 21 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 44 45 46 47 48 49 50 51 52 1 2 3 4 5 6 7 8 9 9 Source: NOS
  • SALMON IS NOW CHEAP RELATIVE TO OTHERPROTEINS10 Source: DNB / IndexMundi
  • BUT RETAIL PRICES REMAIN HIGHMonthly Average prices, Jan 2000 – Oct 201111 Source: Kontali
  • GLOBAL PRODUCTION OUTLOOKHarvest volumes – Atlantic Salmon (tonnes WFE) 2009 2010 Change 2011E Change 2012E Change Norway 856 945 10% 987 4% 1074 9% Chile 239 130 (46%) 227 75% 342 51% UK 145 142 (2%) 157 11% 149 (5%) Canada 115 118 2% 109 (8%) 112 3% USA 16 18 10% 19 3% 19 4% Faroe Islands 48 42 (12%) 57 35% 64 12% Australia 32 33 2% 36 9% 38 6% Ireland 15 18 20% 16 (10%) 16 0% Others 2 1 (18%) 2 50% 2 0% Total 1 468 1 446 (1%) 1 608 11% 1815 13%12 Source: Kontali Nov 18th 2011
  • INCREASED SUPPLY OF ATLANTIC SALMON IN 2011AND 2012 Atlantic salmon supply• 2011 Worldwide supply +11% 2009 – 2012E (000’s MT) • Increase of 1 percentage point since previous estimate +13%• EU supply +7% 2000 +11%• USA supply +9% 1800 -4% 53 135• Increased supply in all main markets 1600 41• 2012 Worldwide supply +13% 40 78 34 115 324 JAPAN: 1400 100 283 RUSSIA: 281 1200 257 432 USA: 1000 373 340 ALL OTHERS: 318 800 EU: 600 400 872 766 737 795 200 0 2009 2010 2011E 2012E13 Source: Kontali Nov 18th 2011
  • ESTIMATED QUARTERLY GROWTH 2012ECAGR: 2009 – 2012E PER QUARTERY-o-Y growth is only part of the story due to low volumes in 201014 Source: Kontali Nov 18th 2011
  • RETAIL SALES OF SALMON – YTD Q3Consumers have reacted negatively to higher prices in salmon YTD Q3 2011 versus YTD Q3 2010 Fresh Smoked Volume Price Volume Price development development development development France -14.5% +5% -2.6% 6.2% Germany -3% +8.4% -2.2% 6.9% UK -7% +5.5% -6.4% +6.2 %15 Source: Europanel / NSEC
  • RETAIL SALES OF SALMON – Q3Consumers have not yet got the full benefit of raw material price decreases Q3 2011 versus Q3 2010 Fresh Smoked Volume Price Volume Price development development development development France +5.7% -7.2% -8.8% 10.6% Germany +34% -4.6% 4.2% 5.6% UK -1% +1% -3.4% -3 % • Clear evidence in the quarter that recent price decreases have had a positive impact on demand • In Germany we have seen a price drop from Q2 2011 to Q3 201116 Source: Europanel / NSEC
  • GERMANYRetail sales of smoked salmon Retail price moved from €2.99 to €2.69* 4 500 Retail price moved 4 000 from €3.19 to €2.99* Retail price moved 3 500 from €2.79 to €2.99* 3 000 Retail price moved from €2.99 to €3.19* 2008 MT p.w. 2 500 2009 2 000 2010 1 500 2011 1 000 500 - Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Source: Europanel / NSEC17 *200g pack smoked salmon
  • FRANCERetail sales of smoked salmon 5 000 4 500 4 000 3 500 3 000 2008 MT p.w. 2 500 2009 2 000 2010 2011 1 500 1 000 500 - P01 P02 P03 P04 P05 P06 P07 P08 P09 P10 P11 P12 P1318 Source: Europanel / NSEC
  • OUTLOOK19
  • THE WAY FORWARDSalmon fits with the global mega trends20
  • LONG TERM CONSUMPTION GROWTH REQUIRESINNOVATIONSashimi slices Salmon Trout21
  • LONG TERM CONSUMPTION GROWTH REQUIRESINNOVATIONPasta Salmon “Look, no brown meat!”22
  • LONG TERM CONSUMPTION GROWTH REQUIRESINNOVATIONInfusions Additions23
  • LONG TERM CONSUMPTION GROWTH REQUIRESINNOVATIONPaper packed Scottish organic Smoked Scottish salmon loinsalmon24
  • SALMON DEMAND WILL PICK UP IN EUROPEDemand will pick up as lower pricesreach the consumer• Supply increases will keep raw material prices under pressure• End product prices will have to come down• Lower prices to end consumer• Demand for (smoked) salmon expected to increase• As an industry we must focus on the customer• Stable quality• Stable pricing25
  • THANK YOU26
  • APPENDIX27
  • WHAT IS DEMAND? Elements of the Law of Demand • The quantity of a well-defined good or service that: • People are willing and able to buy. • During a particular period of time. • Decreases/increases as the price of that good or service rises/falls • All other factors remain constant.28