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projects related to energy transition. Tender activity remains high, and the
market outlook is developing positively.
1Q 2021 Financial Highlights
(excl. special items)
· Revenue NOK 6.5 billion
· EBITDA NOK 427 million
· EBITDA margin 6.6% (4.7% excl. the Nordsee Ost settlement)
· Earnings per share NOK 0.07
· Net cash position NOK 794 million
· Order intake NOK 9.4 billion (1.5x book-to-bill)
· Order backlog NOK 41 billion
“Our earnings and order intake for the quarter increased versus the same period
last year and sequentially. We continued to increase our orderbook by securing
several important new contracts in the quarter. An important development is that
we continue to see increased order intake from energy transition related work,
in line with our strategic ambitions. In the quarter, this counted for about 35
percent of the new contracts. As we move forward, the strong backlog for all our
segments is an important foundation for our growth ambitions,” said Kjetel
Digre, chief executive officer of Aker Solutions.
“We will maintain our leading market position for delivery of complete oil and
gas projects. In parallel, we are rapidly growing our business for renewable
energies and low-carbon solutions for oil and gas. Our high front-end and
tendering activity, a strong position in active markets, combined with our
leading capabilities, makes us well positioned to continue to capitalize on
interesting opportunities ahead,” said Digre.
Key Financials
Aker Solutions reported first quarter revenue of NOK 6.5 billion. The EBITDA was
NOK 427 million excl. special items, an increase versus the same period last
year and sequentially. The earnings per share was NOK 0.07. The company’s
financial position remained solid with a net cash position of NOK 794 million
and a liquidity buffer of NOK 8.5 billion at the end of the quarter.
During the first quarter, Aker Solutions received the final ruling from an
arbitration tribunal in Germany concerning the legacy project Nordsee Ost. The
ruling entitled Aker Solutions to receive a recoverable cash amount of NOK 698
million, and this amount was received at the end of the quarter and recognized
in the company accounts. The recoverable cash amount covered the receivable on
the balance sheet, and in addition contributed by NOK 147 million of positive
effect on interest income and NOK 125 million of positive effect on EBITDA, in
the profit and loss statement.
Order Intake
The order intake in the first quarter was strong at NOK 9.4 billion, equaling
1.5 times book-to-bill. This was a growth of 19 percent compared to the same
period last year and 39 percent increase sequentially. Main awards in the
quarter included Troll West electrification for Equinor, Åsgard B topside EPCI
modification for Equinor, Eldfisk North subsea production system for
ConocoPhillips, Empire Wind FEED for Equinor and BP, Mero 3 topside engineering
and procurement for MISC, Agogo subsea umbilicals for ENI and Barossa subsea
umbilicals for ConocoPhillips. This brought the backlog to a healthy NOK 41
billion, a growth of 22 percent from the same period last year.
Operations and Developments
Operations in the first quarter continued to be impacted by the restrictions
imposed to manage COVID-19, in particular related to the mobilization of
personnel in and out of Norway. Still, the ongoing projects have progressed
based on a strong focus on mitigation of the virus risks, close cooperation with
health authorities, strong dedication from employees, as well as continuous
dialogue with customers to find practical solutions. The company continues to
experience high activity-levels related to front-end work for upcoming projects,
supporting the growth ambitions moving forward.
In Brazil, manufacturing of the subsea trees for Aker BP’s Ærfugl project were
completed successfully during the quarter - on time and below budget. In China,
several umbilicals for the Lingshui project were delivered during the quarter.
In Norway, for Equinor’s Hywind Tampen project, Aker Solutions’ yard at Stord
finalized the first phase of the construction of 11 concrete hulls for the wind
turbines. At the yard in Verdal, the EPC phase for the Johan Sverdrup Phase 2
jacket to Equinor was completed when the large jacket was skidded on to the
transportation barge. In parallel, the planned fast-track progress for the Hod
unmanned wellhead platform to Aker BP is on track for delivery later this year.
In the quarter, Aker Solutions signed a memorandum of understanding (MoU) with
Doosan Babcock to jointly deliver complete projects for low-carbon solutions and
renewable energy in the UK. The partnership is currently pursuing identified
opportunities related to upcoming onshore plants for hydrogen production and
facilities for carbon capture, utilization and storage (CCUS).
The company also announced that it will reduce the environmental footprint from
its own operations, targeting 50 percent reduction in CO2 emissions by 2030,
compared to 2019 level (total scope 1 and scope 2 emissions).
Outlook
The outlook for project sanctioning for 2021 and 2022 remains positive in the
company’s main markets, both in traditional oil and gas and related to energy
transition. The temporary tax incentives on the Norwegian continental shelf is
expected to trigger sanctioning of more than 30 new projects by end of 2022.
Aker Solutions is experiencing high demand for its differentiating front-end
capabilities. Several ongoing early-phase studies are expected to lead to front
-end engineering and design (FEED) work in the second half of 2021.
Tendering activity is high, and Aker Solutions is currently bidding for
contracts totaling about NOK 78 billion. About 30 percent of this is related to
Energy Transition within areas such as offshore wind, carbon capture, hydrogen,
and low-carbon solutions for oil and gas such as subsea gas compression and
electrification.
Looking ahead, while some near-term restrictions related to the COVID-19
pandemic remain, Aker Solutions sees increased market activity. The outlook for
2021 remains unchanged; the company sees overall revenue somewhat lower than
last year’s level, with underlying EBITDA seen up from last year to around the
5.5 percent to 6.0 percent level.
ENDS
Media Contact:
Torbjørn Andersen, mob: +47 928 85 542, email:
torbjorn.andersen@akersolutions.com
Investor Contact:
Fredrik Berge, mob: +47 450 32 090, email: fredrik.berge@akersolutions.com
Aker Solutions delivers integrated solutions, products and services to the
global energy industry. We enable low-carbon oil and gas production and develop
renewable solutions to meet future energy needs. By combining innovative digital
solutions and predictable project execution we accelerate the transition to
sustainable energy production. Aker Solutions employs approximately 14,000
people in more than 20 countries.
Visit akersolutions.com and connect with us on
Facebook (Aker Solutions - Startpagina | Facebook),
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LinkedIn (https://www.linkedin.com/company/aker-solutions),
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YouTube (https://www.youtube.com/akersolutions).
This press release may include forward-looking information or statements and is
subject to our disclaimer, see https://akersolutions.com
This information is subject of the disclosure requirements pursuant to section 5
-12 of the Norwegian Securities Trading Act.
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