Arctic Norwegian Equities Monthly Report July 2020

Arctic Norwegian Equities Monthly Report July 2020 FUND COMMENTS Arctic Norwegian Equities gave 3.4% return in July (I-class) versus 4% for the OSEFX benchmark index. Year to date the fund has returned -14.3% compared to -10.1% for the OSEFX. Since inception the fund has returned 120.7% versus 100.2% for the benchmark index. In July many of the largest companies on the Oslo Stock Exchange announced results for the 2nd quarter. Several companies delivered above market expectations. Of note is DNB which rose near 10 percent on the day of reporting, driven by lower loan losses and higher other income. A number of companies also announced positive profit warmings, including B2 Holding, XXL, Atea and Europris. In July positive attribution for the Fund versus the benchmark index came from overweights in Atea and Crayon, and underweight in Mowi. Atea announced positive results for the 2nd quarter. Revenues were up by 12 percent from Q2 last year, and the company’s operating profit and bottom line were 50 percent higher than market expectations. Atea has further strengthened its competitive position in the Nordics, with a marked share in excess of 20 percent. Crayon also rose in July, partly due to strong software sales for Atea. Crayon is a large global partner of Microsoft. Microsoft announced 2nd quarter results which exceeded market expectations on the top- and bottom line. Shares in salmon farming declined in July, partly due to weak salmon price development. Demand for air transport to China has been reduced after discovery of coronavirus on a salmon cutting board in Beijing. Salmon biomass is also on the rise, especially for coming salmon generations in Norway. Salmon prices have declined sea- sonally, but by more than anticipated. Arctic Norwegian Equities is underweight in Mowi, but is overweight in other salmon farmers. In July negative attribution for the Fund versus the benchmark index came from underweight in Adevinta, and overweights in Grieg Seafood and Bakkafrost. Adevinta announced a big acquisition of eBay’s online classifieds busi- ness. The total purchase price was 9.2 billion dollars or near 85 billion Norwegian kroner, larger than Adevinta’s existing enterprise value. This gives significant consolidation in many European markets, and gives Adevinta access to new markets like Canada, Australia and South Africa. The Adevinta share rose significantly on the news, histori- cally Adevinta has been able to deliver better results than expected from its acquired classified businesses. Howev- er, debt levels will be elevated, and eBay classifieds has shown weaker growth in recent quarters. Arctic Norwegian Equities is overweight in Grieg Seafood and Bakkafrost. The shares fell in July due to weakening salmon prices. Grieg Seafood has higher spot price exposure than most other salmon farmers, and also faces a larger investment program. But Grieg also has higher expected volume growth in the years to come. Year to date the strongest attributors include overweight in Crayon Group and underweight in Subsea 7. The weak- est attributors include overweight in NRC Group and underweight in Tomra Systems. Oslo, August 2020 Albert Collett Alexander Larstedt Lager CIO Portfolio Manager ABOUT THE FUND The investment objective is to achieve long-term capital appreciation primarily through equity investments in companies listed ro traded on markets in Norway. The Fund may be considered as a focused equity fund – a “stock picker”. Our investment team has long experience in challenging the market consensus and invests only in companies and sectors we have knowledge of and understand. We seek to achieve the investment objective through active portfolio management based on competence and analysis of companies, sectors, marketsand the macro-economic outlook. This results in selective company investments. There are no limitations of which sectors within the Norwegian stock market the Fund may invest in. The portfolio composition may deviate significantly from the reference index. The Fund’s reference index is the Oslo Stock Exchange Mutual Fund Index (OSEFX) which is a total return index. The Fund is a UCITS fund. 10% 5.9 % 8.5 % 7.4 % 4.0 % 5.0 % 4.5 % 5% 3.4 % 3.2 % 0% -5% -1.7 % -5.4 % -10% -10.1 % -15% -14.3 % -20% Month YTD 12m 36m p.a. 60m p.a. Incep. p.a. Arctic Norwegian Equities Class I (15/11-10) OSEFX FUND COMPOSITION END OF MONTH Real Estate Real Estate Energy Energy Industrials Industrials Health Care Health Care Consumer Staples Consumer Staples Materials Materials IT IT Financials Financials Consumer Discr. Consumer Discr. Telecom Telecom Utilities Utilities 0% 5% 10% 15% 20% 25% -10% -5% 0% 5% 10% 10 largest positions 5 largest overweights +/- 5 largest underweights +/- DNB ASA 8.4 % Telenor ASA 4.7 % NRC Group ASA 6.5 % Equinor ASA -5.1 % Gjensidige Forsikring ASA 6.9 % Atea ASA 4.7 % Atea 3.9 % Telenor -3.5 % NRC Group ASA 6.5 % Schibsted ASA 4.1 % Crayon Group Holding AS 3.7 % Schibsted ASA CL A -2.5 % Yara International ASA 5.1 % Bakkafrost P/F 4.1 % Gjensidige Forsikring ASA 3.4 % Tomra Systems -2.3 % Mowi ASA 5.0 % Crayon Group holding AS 4.0 % Vaccibody AS 3.0 % Mowi ASA -2.2 % FUND PERFORMANCE AND RISK FIGURES —CLASS I NOK 3 6 Since Month months months YTD 1 year 3 years 5 years launch Fund 3.4 % 10.0 % -11.8 % -14.3 % -5.4 % 9.9 % 24.5 % 120.7 % Benchmark 4.0 % 7.9 % -8.5 % -10.1 % -1.7 % 15.8 % 33.0 % 100.2 % Difference -0.6 % 2.1 % -3.3 % -4.2 % -3.8 % -5.9 % -8.4 % 20.5 % Vinx Nordic Net, NOK 3.2 % 7.8 % 7.5 % 11.4 % 24.4 % 37.8 % 29.3 % 99.4 % Euro Stoxx 600, EUR -1.0 % 5.5 % -11.9 % -13.0 % -5.5 % 2.1 % 3.0 % 72.2 % S&P 500 TR, USD 5.6 % 12.9 % 2.4 % 2.4 % 12.0 % 40.5 % 72.2 % 234.1 % MSCI AC World, LC 4.0 % 11.5 % -1.0 % -1.6 % 6.2 % 23.8 % 42.9 % 133.0 % 5 top contribut. Fund Fund Contri- 5 bottom contribut. Fund Fund Contri- year to date weight return bution year to date weight return bution Vaccibody As 2.9 % 68.7 % 1.23 % Aker Bp Asa 2.8 % -38.4 % -2.15 % Nrc Group Asa 5.9 % -43.1 % -2.10 % Crayon Group Holding 3.3 % 36.5 % 1.18 % Mowi Asa 6.6 % -27.4 % -2.09 % Nel Asa 1.2 % 116.0 % 0.79 % Schibsted Asa-B Shs 3.0 % 18.8 % 0.70 % Tgs Nopec Geophysica 1.8 % -48.4 % -1.52 % Kahoot! As 0.8 % 71.1 % 0.68 % Grieg Seafood Asa 3.3 % -34.4 % -1.45 % Standard Sharpe Tracking Information Portfolio characteristics Deviation Ratio Error Ratio Arctic Norwegian Equities 16.1 % 0.1 4.1 % -0.4 Benchmark 15.5 % 0.3 *) Based on 36 months rolling performance Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec YTD 2020 -2.83 % -12.08 % -16.06 % 8.63 % 6.80 % -0.43 % 3.44 % -14.30 % 2019 3.69 % 2.82 % -0.34 % 2.07 % -2.03 % 1.07 % 0.26 % -0.31 % 0.77 % 3.12 % 3.12 % 3.31 % 18.83 % 2018 -0.59 % 0.34 % -1.79 % 6.33 % 2.10 % 0.83 % 1.38 % 2.75 % 2.32 % -5.34 % -3.07 % -5.98 % -1.40 % 2017 -0.10 % -0.87 % -2.12 % 1.68 % 0.72 % -1.70 % 4.13 % 1.08 % 5.18 % 2.28 % -0.87 % 1.53 % 11.22 % 2016 -8.62 % 2.65 % 1.28 % 3.19 % 2.45 % -2.94 % 1.65 % 1.75 % 2.42 % 3.82 % 1.80 % 2.48 % 11.85 % 2015 4.11 % 0.12 % 1.53 % 3.45 % 0.94 % -1.80 % 1.84 % -5.80 % -2.34 % 3.05 % 2.87 % 2.23 % 10.19 % 2014 0.79 % 2.67 % -0.32 % 0.71 % 3.31 % 2.66 % 0.43 % 0.49 % 0.97 % -1.01 % -0.22 % 2.03 % 13.15 % 2013 4.40 % 5.27 % -0.66 % 2.24 % 3.70 % -3.49 % 3.93 % 0.44 % 1.46 % 6.51 % 4.29 % -0.03 % 31.37 % 2012 5.26 % 9.20 % 0.42 % 0.97 % -7.84 % 4.40 % 1.93 % 2.59 % 2.13 % -2.45 % -1.75 % 1.67 % 16.68 % 2011 -2.89 % 2.19 % -0.17 % -0.06 % -3.43 % -2.25 % -1.08 % -8.59 % -9.19 % 9.65 % -2.28 % 2.43 % -15.78 % 200.0 % Disclaimer: Historical returns are no guarantee for future returns. Future returns will depend, inter alia, on market developments, the fund manager’s skill, the fund’s risk profile and subscription and management fees. 150.0 % The return may become negative as a result of negative price developments. Arctic Asset Management AS seeks to the best of its ability to ensure 100.0 % that all information given in this report is correct, however, makes reserva- tions regarding possible errors and omissions. Statements in the report 50.0 % reflect the portfolio managers’ viewpoint at a given time, and this viewpoint may be changed without notice. The report should not be perceived 0.0 % as an offer or recommendation to buy or sell financial instruments. Arctic Asset Management AS does not assume responsibility for direct or indirect loss or expenses incurred through use or understanding of the report. -50.0 % Employees of Arctic Asset Management AS may be owners of securities 11/10 11/11 11/12 11/13 11/14 11/15 11/16 11/17 11/18 11/19 issued by companies that are either referred to in this rapport or are part of Arctic Norwegian Equities Class I OSEFX the fund's portfolio.

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