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growth plans. Revenues strengthened as the company continued to make good
progress on projects globally. Order intake was very strong at NOK 12.2 billion
in the quarter, increasing the orderbook by close to 30 percent from the same
period last year. Tender activity is record high, and the market outlook is
developing positively.
2Q 2021 Financial Highlights
(excl. special items)
· Revenue NOK 7.0 billion
· EBITDA NOK 392 million
· EBITDA margin 5.6 percent
· Earnings per share NOK 0.14
· Net cash position NOK 0.8 billion
· Order intake NOK 12.2 billion (1.8x book-to-bill)
· Order backlog NOK 45.8 billion
“Our revenue for the quarter increased versus the same period last year and we
maintained our solid financial position. We secured several important contracts
in the quarter, including the major subsea gas compression award Jansz-Io from
Chevron in Australia. This resulted in our strongest quarterly order intake in
several years, of NOK 12.2 billion, increasing our secured order backlog by
close to 30 percent from the same period last year. An important development is
that we continue to see increased order intake from energy transition related
work. In the second quarter, this accounted for about 60 percent of the new
contracts. One year ago, we presented the strategy and goals for the new Aker
Solutions. I am proud to confirm that we deliver on those commitments, and that
we are on track for further profitable growth and transformation,” 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. For the future energy mix, we
are one of few contractors who can deliver complete solutions from first concept
through to the operations phase; from early engineering and management through
construction and installation to operation and maintenance. Increasingly, we see
that our clients recognize our ability to combine effective delivery of complete
solutions with local content and value creation. The outlook for project
sanctioning for the rest of the year and into 2022 remains positive. Our high
front-end and tendering activity, combined with leading capabilities and strong
position in active markets, makes Aker Solutions well positioned to take full
advantage of market opportunities ahead,” said Digre.
Key Financials
In the second quarter, Aker Solutions reported revenue of NOK 7.0 billion and
EBITDA of NOK 392 million excl. special items. This was equivalent to an EBITDA
-margin of 5.6 percent. The same quarter last year included some significant one
-off effects, mainly in the legacy Kvaerner business. The earnings per share was
NOK 0.14 in the quarter. The company’s financial position remained solid with a
net cash position of NOK 0.8 billion and a liquidity buffer of NOK 8.5 billion.
For the first half of 2021, the company reported revenue of NOK 13.5 billion and
EBITDA increased to NOK 820 million excl. special items. This was equivalent to
an EBITDA-margin of 6.1 percent, and the earnings per share increased to NOK
0.21.
Order Intake
The order intake in the second quarter was NOK 12.2 billion, equaling 1.8 times
book-to-bill. About 60 percent was related to energy transition work. During the
quarter, Aker Solutions won a major contract of more than NOK 7 billion from
Chevron to provide the subsea gas compression system for the Jansz-Io field,
offshore Western Australia. This landmark award marks the international
breakthrough for the company’s world-leading subsea gas compression technology.
This next generation compression technology signifies a major leap for the
industry by significantly improving recovery rates, reducing costs and enhancing
safety, with a much smaller environmental footprint than the traditional topside
alternative.
The company also signed other important contracts related to energy transition
during the quarter, including the East Anglia THREE offshore wind project from
ScottishPower Renewables. The scope of the contract includes delivery of
engineering, procurement, construction, and installation (EPCI) of a large HVDC
platform. Order intake on this award is subject to the project reaching
financial close during first half 2022. In addition, the company won a front-end
engineering and design (FEED) contract to develop an e-Fuel facility for Nordic
Electrofuel, where the plan is to produce carbon-neutral, synthetic fuels and
other fossil replacement products, based on hydrogen, CO2 and renewable power.
In the traditional oil and gas business, Aker Solutions was awarded a three-year
subsea lifecycle services frame agreement by Petrobras in Brazil, a three-year
maintenance and modifications frame agreement by Shell in Norway, and a one-year
extension of an existing maintenance and modifications frame agreement with
Equinor on the NCS. The company also secured a topside modifications contract
with OKEA for the Hasselmus gas field development in Norway, and signed a five
-year frame agreement with TotalEnergies, to provide subsea lifecycle services
for its operated fields globally, on a call-off basis, starting out in West
-Africa.
This increased the company’s secured order backlog by close to 30 percent from
the same period last year, to a solid NOK 45.8 billion.
Operations and Developments
The COVID-19 situation improved from the previous quarter, as systematic
mitigation and vaccination programs are progressing well in several countries
globally. Still, the situation remains more challenging in some countries,
including Brazil, India and Malaysia. Aker Solutions continued its strong focus
on mitigation of the virus risks in close cooperation with health authorities,
strong dedication from employees, as well as continuous dialogue with customers
to find practical solutions.
Ongoing projects progressed well during the quarter and the company continues to
experience increasing activity-levels related to front-end work for upcoming
projects, supporting the growth ambitions moving forward.
In Norway, Aker Solutions successfully completed the construction of the first
phase of Equinor’s Hywind Tampen floating wind project. The company also
delivered the jacket for the Johan Sverdrup P2 platform on time and budget. And
in June, a milestone was reached with the Hod unmanned wellhead platform for
Aker BP, making it ready to start the installation-phase only one year after the
contract was signed.
In Angola, Aker Solutions’ support to BP’s installations are progressing well,
and in the U.S., the company made further progress on the FEED work for the
planned Empire Wind project offshore New York.
During the quarter, Aker Solutions continued its transformation. The company
announced the intention to create a leading global company for decommissioning
and recycling of old offshore installations together with AF Gruppen. The
JustEco digital tool was also launched, for calculation and analysis of energy
consumption and environmental footprint of projects, to enable customers to
reduce costs and choose more sustainable solutions.
Outlook
The outlook for project sanctioning for the remainder of 2021 and into 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. Several ongoing early-phase studies are expected to
lead to FEED work during the second half of 2021.
Tendering activity is record high, and Aker Solutions is currently bidding for
contracts totaling about NOK 90 billion. The company will continue to have a
disciplined and selective approach to the projects it is tendering for. About 25
percent of the value is related to energy transition work, such as offshore
wind, carbon capture, hydrogen, and technologies for oil and gas including
subsea gas compression and electrification.
Looking ahead, Aker Solutions sees increased market activity. For 2021, the
company sees overall revenue at around NOK 28 billion, with underlying EBITDA
-margin seen up from last year towards the higher end of the 5.5 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 15,000
people in more than 20 countries.
Visit akersolutions.com and connect with us on
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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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