Aker BioMarine : Annual Report

2021

Annual Report

Table of contents

1. This is Aker BioMarine 3

Letter from the CEO ………………………………………………………………………… .. 4

Company presentation ………………………………………………………………………………… . 5

Organization ………………………………………………………………………………………………… . 14

Strategy …………………………………………………………………………… . ………………………… ... 16

2. Environmental, Social and Governance…….. ………………… . 20

Sustainability in Aker BioMarine ………………………………………………………………… .. 21

Environmental ……………………………………………………………………………………………… . 28

TCFD ……………………………………………………………………………………………………………… 29

Social ………………………………………………………………………………………………………….... 31

Corporate Governance ………………………………………………………………………………… . 37

3. Finance ………………………………………………………………………… .. 40

Financial statements …………………………………………………………………………………… .. 41

Board of directors report ……………………………………………………………………………… 42

Consolidated financial statements……….………..……….. …………………………………… 48

Notes to the consolidated financial statements….. ……………………………………… 54

Financial statements Aker BioMarine ASA…..…. …………………………………………… 95

Notes to the financial statements Aker BioMarine ASA ……………………………… . 100

Responsibility statement ……………………………………………………………………………… . 109

Independent auditors report ……………………………………………………………………… .. 110

Our mission is to improve human and planetary health

The artwork featured on the front page and throughout this report is created by Dr. Nils Hoem, our Chief Scientist. Once a year, Hoem travels to the Antarctic to do biological and ecological research on board our vessels. His watercolor art is inspired by these travels; from the stunning scenery surrounding the vessel to the everyday work life on board.

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1. This is Aker BioMarine

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All set for growth

During the year, we navigated safely through new waves of the pandemic. We faced Antarctic weather that disrupted our fishing season and hindered our harvest. And we experienced a Superba krill market collapse in South Korea. Despite these setbacks, we built a more robust company in 2021, with better value propositions, new harvesting technology, stronger sales and marketing organizations, and more cost-efficient operations. The hard work and passion of our entire team is paying off, and towards the end of 2021, we saw the improvements reflected in our results.

Adverse weather is a natural part of the fishery business, though the conditions in 2021 were more challenging than normal. Aker BioMarine aims to mitigate some of this volatility through the implementation of an Unmanned Surface Vehicle (USV), as this autonomous boat will give us greater accuracy in terms of where to harvest. We will also reduce harvest-related risks by adding more fishing days, running even more efficient and sustainable operations, and increasing volumes sold on the back of higher harvesting rates.

One of our primary short-term priorities is to lift our Superba krill oil sales. The market collapse in South Korea led us to form the "Superba Acceleration" taskforce, and our aim is to rebuild this market and continue with our overall high global growth trajectory, outpacing that of the general market. We plan to achieve this by accelerating numerous products, sales, and marketing initiatives, while continuing to build our brand and secure consumer trust.

In our strategy, we view sustainability and protecting ocean life as critical to not only securing the continuity of our business, but also the also the health of the planet. The United Nations released a landmark climate report in 2021, and another in early 2022, clearly outlining the severity of the climate emergency we face. At Aker BioMarine, we have had a strong sustainability focus that is rooted in science and data-driven innovation since day one. We elevated this focus in 2021, setting bold sustainability commitments and correlating goals that we intend to meet by 2030. We believe our solid ESG commitment will contribute to improved margins and growth in the years to come.

Our sustainability commitments will also impact the way we operate, from new green fuel sources to power our vessels to decarbonizing our production processes. We also aim for full circularity on our waste, and we plan to be a key contributor to overall greater efficiency of aquaculture production. Achieving these goals will require technological innovation, employee commitment and a strategic focus on reaching net zero. We've long served as a leader in sustainability among fisheries, a position we intend to maintain and take even further, setting the bar even higher for the entire industry.

In 2021, we put in operation our new vessel, the Antarctic Provider, which is perhaps the most advanced and environmentally friendly support vessel at sea in the Southern Ocean. And as a newly listed Oslo Stock Exchange company, we hosted our first-ever Capital Markets Update, an opportunity to tell the financial market how we intend to develop our business and meet our targets.

As a company and with our partners, we continue to uncover new benefits and use cases for krill, which gives us much reason for optimism as we enter 2022. We see the light at the end of the pandemic tunnel, and we are coming out of it as a different company. We have faced challenges and we come out even stronger. Our people have proven that nothing can keep them from innovating and developing. Aker BioMarine has built a strong position in the attractive markets for human and animal nutrition for krill. As a fully integrated producer, we target significant sales growth in all our main segments, and we seek improved results and cash flow. Krill harvesting is crucial for the company and with recent investments and measures for improved fisheries, we work to lift the average annual harvesting volumes. We have set ambitious targets for the coming years, and it now comes down to execution.

We are only beginning to understand the full potential of this small crustacean called krill, and I want to extend a big thank you to all our employees, customers, suppliers, and investors, for believing in our potential and going on this journey with us. Together, you are what sparks the hard work and passion in all of us across the Aker BioMarine family.

Matts Johansen, CEO Aker BioMarine

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COMPANY PRESENTATION

About us

Aker BioMarine is a biotech innovator and Antarctic krill harvesting company, created because of our strong belief in the positive health effects of krill. 15 years later, we continue to develop our business as we take care of the ecosystem from which we harvest. Our fully integrated value chain stretches from sustainable krill harvesting in pristine Antarctic waters through our Montevideo logistics hub, Houston production plant, to customers around the world.

KEY FIGURES

PEOPLE

429

employees

42

number of different nationalities

ESG-HIGHLIGHTS

40%

women in Executive Management team

The company has a strong position in its industry and is theworld's leading supplier of krill.

Admitted to trading on the Oslo Stock Exchange, Aker BioMarine consists of two business segments, Ingredients and Brands. Under Ingredients, the company develops krill-based ingredients for human applications in the nutraceutical and dietary supplement space, and animal feed applications for aquaculture and pet food. Under Brands, Aker BioMarine has two companies: Lang Pharma Nutrition and Epion Brands. Lang Pharma Nutrition is a full service, mass market private label and corporate brand manufacturer within supplements, based in the US with large retailers as its primary customers. Epion Brands has its own consumer brand in the US market, Kori, being on the shelves of major retailers. Aker BioMarine's strong focus on sustainability inspired the launch of AION by Aker BioMarine, a circularity company dedicated to helping companies to recycle and reuse waste. Other important innovations are the ongoing developments of INVI and LYSOVETA.

40%

of our trawls and big bags from Houston being recycled in 2021

REVENUE USD mill.

Reduction inproduct waste from 2020 to 2021 was

94%A-rating

7th year in a row from the Sustainable Fisheries Partnership (SFP) and top rated by MSC

ADJUSTED EBITDA (USD mill) AND MARGIN (%)

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