Quarterly Report • Feb 21, 2024
Quarterly Report
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Unaudited 4th quarter and preliminary Annual results 2023
"Dividend of NOK 1.7 per share for 2023"
| Operating Revenue | 614 MNOK |
|---|---|
| EBITDA | 51 MNOK |
| Cash Flow from Operations | 111 MNOK |
| Order Intake | 122 MNOK |
| SIF (FY 2023) | 0,67 |
| Employees* | 1440 |
* Employees end of quarter
REVENUE EBITDA
The highlights for Beerenberg (Beerenberg AS consolidated) in the 4 th quarter 2023 were:
The revenue in 2023 of MNOK 2 343 is up 5% from MNOK 2 222 in 2021. Revenue in the 4th quarter was MNOK 614 compared to MNOK 569 in 4th quarter 2022.
EBITDA in the 4th quarter 2023 was MNOK 51, up from MNOK 49 in the corresponding quarter last year. EBITDA margin 8.3% compared to 8.5% in the 4th quarter last year. The 2023 EBITDA MNOK 191 compared to MNOK 180 in 2022. The EBITDA margin in 2023 is 8.1% compared to 8.1% in 2022. EBITDA in 2023 has been influenced by one off cost in relation to listing Beerenberg at the Euronext Growth marketplace of MNOK 7 and other one offs. Adjusted for 2023 one offs, EBITDA in 2023 is MNOK 203 compared to Adjusted EBITDA in 2022 of MNOK 183. The adjusted EBITDA margin in 2023 is 8.7% compared to 8.2% in 2022
Financial cost in the 4th quarter 2023 was MNOK 24. Finance cost include MNOK 15 in earnout of the Remotion acquisition. The total earnout of MNOK 40 will have cash effect in the 2nd quarter of 2024 in line with earlier communication from the company. Adjusted for the earnout, finance cost was MNOK 9 in the 4th quarter compared to 24 in the 4th quarter 2022. In 2023 the finance cost was MNOK 88 compared to 79 in 2022. Higher financial cost in 2023 compared to 2022 is mostly due to effects related to redemption fee while refinancing.
Net profit in the 4th quarter 2023 was MNOK 4 compared to a net profit of MNOK 2 in the 4th quarter 2022. Net profit in 2023 was MNOK 17 compared to MNOK 19 in 2022.
Total assets were MNOK 1834 at the end of the quarter, with an equity ratio of 44%. The group's cash position has increased from MNOK 113 in the 4th quarter 2022 to MNOK 165 in the 4th quarter 2023.
Total non-current assets were MNOK 1110, up from MNOK 1049 compared to the end of 4th quarter 2022. The increase is mainly related to renewal of a long term lease contract. Current assets of MNOK 724 were down from MNOK 726 in the same period last year.
Total current liabilities of MNOK 584 were down from MNOK 1172 at the end of the 4th quarter 2022 and total non-current liabilities were MNOK 439 up from MNOK 45 in the 4th quarter 2022. The main reason for these changes is reclassification of bank debt debt to non-current liabilities due to the long term refinancing in place in 2023. In connection with the public listing of the company in October MNOK 200 in interest bearing debt was repaid.
Net interest-bearing debt was MNOK 312 compared to MNOK 593 in the 4th quarter 2022. In the 4th quarter MNOK 200 has been repaid.
Net working capital ended at MNOK 53 in the period, compared to MNOK 131 at the end of the 4th quarter 2022. The decrease relates mainly to higher supplier liabilities and higher cash position, but also accrued earnout of MNOK 40. The development of working capital needs to be assessed over a period and not solely at the end of the quarter.
The Groups cash position was MNOK 165 by the end of the 4th quarter 2023 up from MNOK 113 same period last year.
Cash flow from operating activities was positive by MNOK 111 in the period versus positive by MNOK 131 in corresponding period last year. The difference relates mainly to changes in net working capital which is greatly influenced by the timing of payments on invoices related to our major framework contracts.
Cash flow from investing activities was negative by MNOK 23 compared to negative MNOK 41 in the 4th quarter 2022. Investing activities were Capex related to machinery and equipment.
Cash flow from financing activities was negative by MNOK 6 compared to negative MNOK 48 in the 4th quarter 2022. Finance activities in the quarter affected by capital increase of MNOK 233 (Net) when listing the company, repayment of short term loan MNOK 200 and amortization of MNOK 10. Other finance items of MNOK 15 relates to accrued earnout. The cash effect of the earnout will be in the 2nd quarter of 2024.
Total cashflow in the 4th quarter 2023 was positive by MNOK 82 compared to positive MNOK 70 in the 4th quarter 2022.
The tender activity has been stable during the 4th quarter of 2023 relating both to Benarx/Subsea deliveries and new build/modification projects (oil&gas, industry and infrastructure).
Total order intake of new contracts was approximately MNOK 122 for the period. The major part of the order intake is related to two contracts or exercise of options in Norway and one new contract in Brazil.
In Q4 2023 the company has carried out a revised market adjustment of the frame agreements adding approximately MNOK 600 to the order backlog.
The current estimated order backlog (including frame agreements and options) is BNOK 7,2.
At the end of 4th quarter Beerenberg had 1440 employees.
No serious incident in 4th quarter resulting in a total Serious Incident Frequency (SIF) in the 4th quarter of 0 and 0,67 during the last 12 months.
| Focus area | # | Key KPIs | 2023 Goal |
Q4 2023 Actual |
Impact on UN's SDGs |
|---|---|---|---|---|---|
| f 3 | $\mathbf{1}$ | Reduced release of microplastics in connection with surface treatment * | >20% | 8% | 13 GENATE 12 RESPONSIBLE |
| $\left\langle \raisebox{.4ex}{\scriptsize{*}}\right\rangle$ ustainabli moterialt |
$\overline{2}$ | Reduced CO2 footprint in connection with surface treatment** | >10% | 18% | |
| Sustainable mathods ٨ |
$\mathbf{R}$ | Number of new sustainable technology, materials or solutions studied, tested, developed or adopted |
>8 | 8 | 14 LIFE BELOW ≈≈ |
| Climate action |
$\Delta$ | Share of turnover in new and sustainable markets | >8% | 9% | SO |
| 5 | SIF (serious incident frequency) - YTD | $\mathbf 0$ | 0,7 | 3 HOD HEALTH | |
| සු usponsită Ocure - o |
6 | TRIF (total recordable incident frequency) - YTD | 3,0 | 7,7 | |
| ಖ Safe work Inviconmen $\mathcal{L}(\mathcal{I})$ |
$\overline{7}$ | Proportion of sick leave | < 6,5% | 9% | |
| Astractive workplace |
8 | Compentance development - Trade certificates | 30 | 45 | 8 ECONOMIC GROWTH |
| 9 | Planned suppler follow up meetings and audits | 80 % | 67% | ||
| 鳥 | 10 1 | Proportion of employees who have completed training in ethics | 90 % | 80 % | 8 ECENT WORK AND |
| ESG governance $\overline{\mathbb{G}}$ |
11 | Proportion of operational employees who have completed training in HSE*** | 90 % | 75 % | |
| ESG ommunication ΔЪ |
12 | Human rights due dillegance assessment | 75 % | 67% | 9 ANDESTRY, PORTAGEOR |
| Business ethics 1 |
13 | Regularly publish articles on Beerenbergs ESG initiatives (external) | 10 | 11 |
Beerenberg uses experience from the oil and gas industry in the bridge maintenance market.
Infrastructure maintenance is not new to Beerenberg, who has supplied scaffolding for bridges for years. Now the company takes on entire maintenance projects in this segment.
Bridge maintenance has many features in common with other maintenance activities and experience with large multidisciplinary maintenance projects are strengths that Beerenberg brings to the table. Streamlining maintenance work, ensuring sustainable maintenance, and reducing challenging and burdensome work tasks for professionals could help lift the bridge maintenance field forward.
"This is an exciting area for us that could become an important business area for the company going forward", says Beerenberg CEO Arild Apelthun.
Tunheim bridge at Tynset has been fully rehabilitated after the bridge was found to have suffered major damage and defects that affected load-bearing capacity, traffic safety and service life.
The assignment included mechanical repair of concrete damage, creation of new edge girders, surface treatment of steel beams and bearings, creation of joint constructions, removal of asphalt and creation of a new wear layer, replacement, and creation of railings over bridges and on land, as well bridge washing and removal of fouling, on and under casting pillars. The project was delivered on time.
"Beerenberg had everything in order from day one, with all documentation easily accessible for us. This shows professionalism. We have also received all requested information during the project", says project manager Stein Jordet at Tynset Municipality.
"The climate can be challenging here with river floods and temperatures of minus 25-30 degrees and snow, that can impact concrete work. Despite these challenges, and some additional
assigned work, the job was carried out in a good way and within deadline", adds Jordet.
The bridge from 1937 was part of the main road between Elverum and Trondheim before the new national road came and the municipality took over responsibility. Since then, nothing had been done with it. Maintenance of the 40-metre-long steel girder bridge with a concrete cover and a span of 20 meters was therefore badly needed.
Beerenberg has rehabilitated the Storeneset suspension bridge, which connects the island of Lammetun to the mainland in Fjaler municipality in Vestland county. The bridge, which has a span of 95 metres, was now in need of maintenance after significant damage and deficiencies were discovered on joints, bridge bearings and railings, as well as localized corrosion on parts of steel which meant that repairs were necessary. The project was delivered to the client on October 30th.
"We are very satisfied with the work that has been done and the way the task has been solved, with a proper system for both HSE and reporting. This is great", says project manager Arne Strand in Fjaler municipality.
Strand takes the fact that the municipality has received little feedback from the local population as a good sign that they are also satisfied.
"When such maintenance projects are to be carried out, it necessarily results in closed roads. Good cooperation with the contractor is very much appreciated by the municipality. Here, Beerenberg has gone to great lengths to keep the bridge minimally closed and kept the road open, when possible", says Strand.
Berenberg's project team is well prepared for more bridge maintenance work, with experienced professionals and professional equipment.
"It is meaningful for us to contribute to the municipalities with such maintenance work so that the local population now can travel safely over the bridge", says project manager Sveinung Tenold in Beerenberg.
The Service segment revenue for the 4th quarter was MNOK 573, up MNOK 51 compared to the corresponding period last year. In 2023 the total revenues ended at MNOK 2 212 compared to MNOK 2 064 in 2022. The EBITDA margin in 4th quarter was 8.3% compared to 7.7% in 2022. Strong demand for Beerenberg's services in the quarter.
The Benarx segment reported a revenue of MNOK 56 in the 4th quarter compared to MNOK 65 in 2022. Reported EBITDA was MNOK 4 in the 4th quarter and MNOK 0 full year 2023. for the quarter with a EBITDA of MNOK 4. The year 2023 and the 4th quarter was influenced by low activity in Asia due to delays on projects. Europe with many small orders making profitable production difficult. Subsea with increasing activity with several deliveries both in Norway and internationally.
| Group Summary | Q4 | Q4 | YTD | YTD | FY | |
|---|---|---|---|---|---|---|
| Amounts in NOK million | Note | 2023 | 2022 | 2023 | 2022 | 2022 |
| Operating revenue | 6 | 614,1 | 569,0 | 2 343,2 | 2 221,9 | 2 221,9 |
| Operating expenses | 563,0 | 520,4 | 2 152,7 | 2 041,9 | 2 041,9 | |
| EBITDA | 6 | 51,1 | 48,5 | 190,5 | 180,0 | 180,0 |
| Depreciation | 11,2 | 15,3 | 57,9 | 56,7 | 56,7 | |
| EBITA | 40,0 | 33,2 | 132,7 | 123,3 | 123,3 | |
| Amortisation | 3,0 | 12,9 | 14,5 | 25,2 | 25,2 | |
| Operating profit (EBIT) | 37,0 | 20,4 | 118,2 | 98,1 | 98,1 | |
| Finance costs - net | 4 | 23,9 | 23,5 | 88,3 | 78,7 | 78,7 |
| Profit before tax (EBT) | 13,0 | -3,1 | 29,8 | 19,4 | 19,4 | |
| Income Tax expense | 9,2 | -5,5 | 12,8 | 0,0 | 0,0 | |
| Net profit | 3,9 | 2,4 | 17,1 | 19,4 | 19,4 | |
| Profit for the period is attributable to: | ||||||
| Shareholders of the parent company | 3,9 | 2,5 | 17,1 | 19,6 | 19,6 | |
| Non controlling interests | 7 | 0,0 | -0,1 | 0,0 | -0,2 | -0,2 |
| Net profit | 3,9 | 2,4 | 17,1 | 19,4 | 19,4 | |
| Diluted earnings per share are identical as there are no dilutive effect |
||||||
| EBITDA margin | 8,3 % | 8,5 % | 8,1 % | 8,1 % | 8,1 % | |
| EBITA margin | 6,5 % | 5,8 % | 5,7 % | 5,6 % | 5,6 % |
Condensed Consolidated statement of comprehensive income
| Q4 | Q4 | YTD | YTD | FY | |
|---|---|---|---|---|---|
| Amounts in NOK million Note |
2023 | 2022 | 2023 | 2022 | 2022 |
| Net profit for the period | 3,9 | 2,4 | 17,1 | 19,4 | 19,4 |
| Other comprehensive income: | |||||
| Conversion differences | -0,1 | 0,7 | 2,9 | -1,1 | -1,1 |
| Change in value of derivatives | -4,4 | -1,6 | -10,2 | 4,1 | 4,1 |
| Total comprehensive income | -0,6 | 1,5 | 9,7 | 22,4 | 22,4 |
| Group Summary | Q4 | Q4 | YTD | |
|---|---|---|---|---|
| Amounts in NOK million | Note | 31.12.2023 | 31.12.2022 | 31.12.2022 |
| Intangible assets | 39,5 | 52,1 | 52,1 | |
| Goodwill | 782,8 | 782,8 | 782,8 | |
| Property, plant and equipment | 267,4 | 210,0 | 210,0 | |
| Financial fixed assets | 17,8 | 14,3 | 14,3 | |
| Deferred tax assets | 2,4 | 0,0 | 0,0 | |
| Total non-current assets | 1 109,9 | 1 059,2 | 1 059,2 | |
| Inventory | 89,1 | 93,9 | 93,9 | |
| Accounts receivables from customers | 283,9 | 261,7 | 261,7 | |
| Earned, not invoiced accounts receivables | 160,8 | 215,9 | 215,9 | |
| Other receivables | 25,9 | 41,9 | 41,9 | |
| Cash at bank | 164,7 | 113,3 | 113,3 | |
| Total current assets | 724,3 | 726,7 | 726,7 | |
| TOTAL ASSETS | 1 834,2 | 1 785,8 | 1 785,8 | |
| Share capital | 61,4 | 26,7 | 26,7 | |
| Share premium | 438,6 | 240,3 | 240,3 | |
| Other equity | 311,5 | 302,3 | 302,3 | |
| Non controlling interests | 7 | 0,0 | -0,5 | -0,5 |
| Total equity | 811,5 | 568,8 | 568,8 | |
| Pension liabilities | 25,5 | 19,3 | 19,3 | |
| Interest bearing long-term liabilities | 4 | 412,3 | 26,1 | 26,1 |
| Derivatives | 1,2 | 0,0 | 0,0 | |
| Total non-current liabilities | 439,0 | 45,4 | 45,4 | |
| Interest bearing short-term liabilities | 4 | 64,1 | 680,0 | 680,0 |
| Supplier liabilities | 155,6 | 133,9 | 133,9 | |
| Tax payable | 12,8 | 9,4 | 9,4 | |
| Social Security, VAT and other taxes | 81,6 | 83,5 | 83,5 | |
| Other short-term liabilities | 249,6 | 242,7 | 242,7 | |
| Warranty liabilities | 20,0 | 22,2 | 22,2 | |
| Total Current Liabilities | 583,7 | 1 171,6 | 1 171,6 | |
| TOTAL EQUITY & LIABILITY | 1 834,2 | 1 785,8 | 1 785,8 |
| Amounts in NOK million | ||||||||
|---|---|---|---|---|---|---|---|---|
| Share capital |
Share premium |
Conversion reserve |
Hedging reserve |
Retained earnings |
Equity attributable to parent Company |
Non Contolling interests |
Total equity | |
| 01. January 2023 | 26,7 | 240,3 | -2,1 | 9,2 | 295,2 | 569,3 | -0,5 | 568,8 |
| Net profit | 17,1 | 17,1 | 17,1 | |||||
| Other Comprehensive Income | 2,8 | -10,2 | -7,4 | -7,4 | ||||
| Changes in non-controlling interests | -0,5 | -0,5 | 0,5 | 0,0 | ||||
| Share Capital increase | 34,7 | 198,3 | 233,0 | 233,0 | ||||
| Equity as per 31.12.2023 | 61,4 | 438,6 | 0,7 | -0,9 | 311,7 | 811,5 | 0,0 | 811,5 |
| Amounts in NOK million | ||||||||
|---|---|---|---|---|---|---|---|---|
| Share capital |
Share premium |
Conversion reserve |
Hedging reserve |
Retained earnings |
Equity attributable to parent Company |
Non Contolling interests |
Total equity | |
| 01. January 2022 | 26,7 | 240,3 | -1,0 | 5,2 | 275,4 | 546,5 | -0,1 | 546,4 |
| Net profit | 19,8 | 19,8 | -0,4 | 19,4 | ||||
| Other Comprehensive Income | -1,1 | 4,1 | 2,9 | 2,9 | ||||
| Changes in non-controlling interests | ||||||||
| Equity as per 31.12.2022 | 26,7 | 240,3 | -2,2 | 9,3 | 295,2 | 569,3 | -0,5 | 568,8 |
Beerenberg AS is a company domiciled in Norway. The consolidated financial statements of Beerenberg AS comprise the company and its subsidiaries, together referred to as the group. The Beerenberg Group was established 01. March 2013, as a result of the Beerenberg AS acquisition of all shares in Beerenberg Holding AS.
Beerenberg is delivering products and services to its customers in complex environments implying operational risk with regards to quality, cost, time and injuries and accidents (HSE). Beerenberg works systematically to mitigate and manage risk on all levels. The annual report for 2022 provides further information on risks and uncertainties applicable to Beerenberg.
A reverse share split was carried out mid-September, merging 25 shares into one share. Shareholders in Beerenberg AS at 31.12.2023 are specified in table below. The company was listed the 5th of October.
| Shareholder | Number of shares | Stake |
|---|---|---|
| Segulah IV L.P. | 5 327 168 | 21,7 % |
| CAMAR INVEST 3 AS | 4 444 444 | 18,1 % |
| The Bank of New York Mellon | 1 776 985 | 7,2 % |
| MUSTANG CAPITAL AS | 1 400 000 | 5,7 % |
| KONTRARI AS | 1 250 000 | 5,1 % |
| BNP Paribas | 740 555 | 3,0 % |
| BNP Paribas | 594 921 | 2,4 % |
| The Bank of New York Mellon SA/NV | 554 705 | 2,3 % |
| VERDIPAPIRFONDET STOREBRAND NORGE | 508 600 | 2,1 % |
| VERDIPAPIRFONDET STOREBRAND VERDI | 460 163 | 1,9 % |
| SKEIE KAPITAL AS | 450 000 | 1,8 % |
| TOLUMA NORDEN AS | 444 444 | 1,8 % |
| INTERTRADE SHIPPING AS | 300 000 | 1,2 % |
| KRISTIAN FALNES AS | 300 000 | 1,2 % |
| EJA HOLDING AS | 250 000 | 1,0 % |
| TIGERSTADEN AS | 240 000 | 1,0 % |
| OMA INVEST AS | 225 000 | 0,9 % |
| BJØRGVIN AS | 220 000 | 0,9 % |
| H CAP AS | 219 351 | 0,9 % |
| Others | 4 863 664 | 19,8 % |
| Total | 24 570 000 | 100,0 % |
The interim financial statements for the group are prepared in accordance with International Financial Reporting Standards (IFRS) as approved by the European Union and their interpretations adopted by the International Accounting Standards Board (IASB).
The interim report does not include all the information required for full annual consolidated financial statements in an Annual Report and should be read in conjunction with the Annual Report of the group for 2022. The accounting policies applied in the interim financial statements is the same as those described in the Annual Report for 2022.
The condensed consolidated interim financial statements are prepared in accordance with IAS 34 Interim Financial Reporting. The interim financial statements are unaudited.
The Annual Report for 2022 is available at www.Beerenberg.com
In applying the accounting policies, management makes judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, income and expenses. The estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Revision to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
In preparing this interim financial statement, the significant judgments made by management in applying the group's accounting policies and the key sources of uncertainty in the estimates were consistent with those applied to the consolidated financial statements as at and for the period ended 31. December 2022. Please refer to Note 3 in the Annual Report for 2022.
Repayment of the bond BBERG03 of MNOK 625 was finalized the 19th of July. New long-term financing of 600 was established in SpareBank 1 SR-Bank. The Financing Package consisted of 3 Term loans of MNOK 200 each. Tranche 1 has 5-year maturity and quarterly amortization of MNOK 10, Tranche 2 has also 5-year maturity but with no amortization. Tranche 3 had one year maturity and was repaid on the 10th of October 2024 following the public listing.
Interest margins in addition to 3mnth Nibor are 4,25 % for Tranche 1, 4,75 % and for Tranche 2.
Financial covenants related to the Financing Package are the following:
| Minimum Equity share: | 25% | |
|---|---|---|
| Maximum Net Interest Bearing debt / 12 months rolling EBITDA | Until 31.12.2024 | < 4 |
| Until 31.12.2025 | < 3 | |
| Until 31.12.2026 | < 2,5 | |
| Minimum Current assets / Short term debt excluding loans and amortization within one year | 1,15 |
The Group is well within these covenants.
Segulah, the largest Shareholder prior to the public listing, provided security of MNOK 150 covering Tranche 3 as described in Note 4. The Guarantee provision was 2%. The guarantee has been terminated in October as Tranche 3 has been repaid.
No other related party transactions were conducted in 4th Quarter of 2023.
Beerenberg is organized in two operating segments in order to optimize and focus its business. The Services segment includes business related to the traditional ISS-activity in the group, which is mainly related to major framework agreements, and the Benarx segment which consists of advanced insulation for topside and subsea applications.
| Q4 | Q4 | YTD | YTD | FY | |
|---|---|---|---|---|---|
| Amounts in NOK million | 2023 | 2022 | 2023 | 2022 | 2022 |
| Services | 572,7 | 520,9 | 2 212,1 | 2 063,7 | 2 063,7 |
| Benarx | 56,3 | 65,3 | 194,3 | 219,2 | 219,2 |
| Eliminations | -14,8 | -17,2 | -63,2 | -61,0 | -61,0 |
| Total | 614,1 | 569,0 | 2 343,2 | 2 221,9 | 2 221,9 |
| Q4 | Q4 | YTD | YTD | FY | |
|---|---|---|---|---|---|
| Amounts in NOK million | 2023 | 2022 | 2023 | 2022 | 2022 |
| Services | 47,5 | 35,0 | 190,6 | 159,1 | 159,2 |
| Benarx | 3,7 | 13,5 | -0,1 | 20,9 | 20,9 |
| Total | 51,1 | 48,5 | 190,5 | 180,0 | 180,0 |
A subsidiary in Thailand is owned 51% by an entity outside the Group. However, the voting rights of the shares implies that the Group have control of the subsidiary. In addition, the shareholder agreement between the two shareholders entitles Beerenberg to any dividends or losses in this subsidiary. The other shareholder is entitled to 3% percentage of its invested capital in the subsidiary. Following a revision of the shareholder agreement, the allocation of profit and loss and the allocation of equity between Beerenberg and the non-controlling entity have been revised.
No events have occurred after the reporting date, that are of significant impact when considering the financial position or result in the group.
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