Quarterly Report • May 19, 2021
Quarterly Report
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Unaudited 1st Quarter results 2021
"Strong performance in challenging market"
| Operating Revenue | 436 MNOK |
|---|---|
| EBITDA | 38 MNOK |
| Cash Flow from Operations | 34 MNOK |
| Order Intake | 21 MNOK |
| SIF | 0 |
| Employees* | 1215 |
* Employees end of quarter
The highlights for Beerenberg (Beerenberg AS consolidated) in the 1st quarter 2021 were:
Revenue in 1st quarter was MNOK 436 compared to MNOK 480 in 1st quarter 2020. The decrease from the corresponding quarter last year relates mainly to the closing of the Norwegian border from the end of January, delays in some projects as a result of the closing and the strict Covid-19 protocols.
EBITDA in 1st quarter 2021 was MNOK 38 up from MNOK 37 corresponding quarter last year. Cost reductions and good operational performance, but also quarantine regulations and borders restrictions explains the EBITDA margin.
Financial cost in the 1st quarter 2021 was MNOK 20, up from MNOK 7 in the 1st quarter 2020. Currency effects are included in financial costs, and high volatility of currencies explains the low financial costs in 1st quarter 2020
Net profit in 1st quarter 2021 was MNOK 1 compared to a net profit of MNOK 9 in 1st quarter 2020.
Beerenberg – Unaudited Financial Report
The balance sheet reflects decreased activity level in the quarter compared to last year. The groups cash position has decreased compared to last year mainly due to the repayment of the old bond (MNOK 850) and the new 3 year bond issue (MNOK 750). Total assets were MNOK 1 658 at the end of the quarter, with an equity ratio of 30%.
Total non-current assets were MNOK 1035, down from MNOK 1072 compared to the end of 1st quarter 2020. Current assets of MNOK 623 were down from MNOK 737.
Total current liabilities of MNOK 487 were down from MNOK 1 282 at the end of 1st quarter 2020 and total non-current liabilities were MNOK 681 compared to 80 at the end of 1st quarter 2020. From Q4-2020 bond is classified as non-current liability following the completion of the refinancing process and issue of the new bond.
The net interest-bearing debt was MNOK 601 compared to MNOK 708 in 1st quarter 2020.
Net working capital ended at MNOK 92 in the period, compared to MNOK 141 at the end of 1st quarter 2020.
The Groups cash position was MNOK 146 by the end of 1 st quarter 2021 compared to MNOK 210 as by the end of the 1st quarter 2020. The main reason is repayment of the old bond and issue of a new bond of a lower amount.
Cash flow from operating activities was positive by MNOK 34 in 1st quarter 2021 versus negative MNOK 22 in corresponding period last year. The increase relates mainly to negative changes in net working capital in 1st quarter 2020.
Total cashflow in 1st quarter 2021 was positive by MNOK 6 compared to negative MNOK 47 in 1st quarter 2020. The difference between the periods is mainly explained by negative changes in net working capital as explained for the operating cash flow.
Capex was MNOK 10 compared to MNOK 3 same quarter last year.
The tender activity has been stable during the 1st quarter of 2021 relating both to Products deliveries and Services.
Total order intake of new contracts was MNOK 21 for the period. The order intake consists of several minor awards mainly related to Products deliveries/projects.
The current estimated order backlog (including frame agreements and options) is BNOK 7,8.
At the end of 1st quarter Beerenberg had 1215 employees, up from 1203 last quarter.
Zero serious incidents this quarter, results in a total Serious Incident Frequency (SIF) in the period of 0 and 1,0 during the last 12 months.
The Covid-19 pandemic is still affecting the business. Beerenberg has implemented quarantine rules and a covid-19 test regime for all of our foreign workers in order to prevent outbreak of covid-19 at our projects.
Persistent restrictions on travel between countries represents challenges and affects our flexibility and ability to deliver.
Beerenberg has gained experience during the past year in handling the ever-shifting regulations and restrictions as a result of the Covid-19 pandemic.
Beerenbergs contribution to UN Sustainable Development Goals
Beerenberg is in a process to implement an ESG strategy where we combine existing sustainable solutions and KPI's with new sustainable initiatives.
The SDGs described below are those considered the most material for Beerenberg, i.e. those where we can have the greatest impact.
Beerenberg is focusing on building a diverse work force. Non-discrimination is directly linked to the company's value to be "inclusive" and we have established policies
and procedures to secure equality and non-discrimination on the basis of gender. It is Beerenberg's ambition to increase the proportion of women at all levels within the organization by taking a systematic approach to recruitment and enabling development and growth within the organization.
Our operations contribute to the development of local communities providing safe and meaningful jobs. We follow up closely our HSE program, absence rate, number of cases raised in the whistle blower channel, training on ethics, and our workforce originate from many different countries. Everywhere we operate, across the world, all our employees are being paid the local tariff.
We invest in research, development and innovation to make our products done in a more sustainable way. We are working on a program to reduce carbon emission through electrifying our equipment and seek new solutions for the future. In the coming years these initiatives will be important to achieve our sustainable goals.
We support the need for global solutions to mitigate the climate changes. The ambition that our activities shall have minimal impact on the natural environment is both essential and inspiring in our work to continually improve the environmental performance.
Life below water and microplastic has had an increasingly focus over the last years. Beerenberg is adapting technology to reduce microplastic waste in the ocean. Our goal for 2021 is to reduce microplastic waste with 20% through adapting technology collecting microplastic.
Our products, work practices and use of renewable resources shall support a clean and sustainable industry which embrace sound and healthy ecosystems for future generations. Recycling and sufficient waste management will support our aim.
Achieving a sustainable future will require that the whole value chain is committed to work for common SDG's. We are fully committed in working with our customers, suppliers and other stakeholders to implement SDG's and work for a more sustainable future. Beerenberg is also committed to conduct its business in compliance with the Ten Principles of the UN Global Compact.
The Service segment revenue for 1st quarter was MNOK 364, a drop of 10% compared to last year mainly due to constrained access to foreign personnel from end January. The EBITDA margin was 7.2%. Cost related to Covid-19 protocols, activity decrease, but also cost reductions, and good operational performance explains the margins.
The Benarx segment reports a revenue of MNOK 92 for the quarter with an EBITDA of 13%. Revenue was up 4% compared to the same period last year. The quarter was affected by some delays on projects as well as impacts of the Covid-19 pandemic. Cost savings and good operational performance results in the segment during the period.
| Group Summary | Q1 | Q1 | YTD | YTD | FY | |
|---|---|---|---|---|---|---|
| Amounts in NOK million | Note | 2021 | 2020 | 2021 | 2020 | 2020 |
| Operating revenue | 6 | 436,0 | 480,0 | 436,0 | 480,0 | 1 722,7 |
| Operating expenses | 397,6 | 443,2 | 397,6 | 443,2 | 1 506,0 | |
| EBITDA | 6 | 38,4 | 36,7 | 38,4 | 36,7 | 216,7 |
| Depreciation | 12,5 | 13,3 | 12,5 | 13,3 | 54,4 | |
| EBITA | 25,9 | 23,4 | 25,9 | 23,4 | 162,3 | |
| Amortisation | 4,1 | 4,3 | 4,1 | 4,3 | 16,5 | |
| Operating profit (EBIT) | 21,9 | 19,1 | 21,9 | 19,1 | 145,8 | |
| Finance costs - net | 4 | 20,3 | 7,4 | 20,3 | 7,4 | 90,8 |
| Profit before tax (EBT) | 1,5 | 11,7 | 1,5 | 11,7 | 55,0 | |
| Income Tax expense | 0,3 | 2,6 | 0,3 | 2,6 | 8,5 | |
| Net profit | 1,2 | 9,1 | 1,2 | 9,1 | 46,5 | |
| Profit for the period is attributable to: | ||||||
| Shareholders of the parent company | 1,2 | 9,1 | 1,2 | 9,1 | 47,1 | |
| Non controlling interests | 0,0 | 0,0 | 0,0 | 0,0 | -0,6 | |
| Net profit | 1,2 | 9,1 | 1,2 | 9,1 | 46,5 | |
| Basic earnings per share for 1.000.000 A shares (NOK) |
0,00 | 0,01 | 0,00 | 0,01 | 0,05 | |
| Diluted earnings per share are identical as there are | ||||||
| no dilutive effect | ||||||
| EBITDA margin | 8,8 % | 7,7 % | 8,8 % | 7,7 % | 12,6 % | |
| EBITA margin | 5,9 % | 4,9 % | 5,9 % | 4,9 % | 9,4 % |
| Q1 | Q1 | YTD | YTD | FY | ||
|---|---|---|---|---|---|---|
| Amounts in NOK million | Note | 2021 | 2020 | 2021 | 2020 | 2020 |
| Net profit for the period | 1,2 | 9,1 | 1,2 | 9,1 | 46,5 | |
| Other comprehensive income: | ||||||
| Conversion differences | -1,2 | 2,5 | -1,2 | 2,5 | -1,1 | |
| Change in value of derivatives | 3,1 | -4,8 | 3,1 | -4,8 | 0,0 | |
| Total comprehensive income | 3,2 | 6,9 | 3,2 | 6,9 | 45,3 |
,
| Group Summary | Q1 | Q1 | Q4 | |
|---|---|---|---|---|
| Amounts in NOK million | Note | 31.03.2021 | 31.03.2020 | 31.12.2020 |
| Intangible assets | 27,0 | 43,3 | 31,1 | |
| Goodwill | 782,8 | 782,8 | 782,8 | |
| Property, plant and equipment | 215,3 | 237,8 | 213,6 | |
| Financial fixed assets | 9,9 | 8,2 | 9,9 | |
| Total non-current assets | 1 034,9 | 1 072,1 | 1 037,3 | |
| Inventory | 78,5 | 74,4 | 66,2 | |
| Accounts receivables from customers | 243,5 | 301,0 | 249,6 | |
| Earned, not invoiced accounts receivables | 125,0 | 124,7 | 144,0 | |
| Other receivables | 30,4 | 27,5 | 39,2 | |
| Cash at bank | 145,5 | 209,6 | 139,7 | |
| Total current assets | 622,8 | 737,2 | 638,8 | |
| TOTAL ASSETS | 1 657,8 | 1 809,3 | 1 676,0 | |
| Share capital | 26,7 | 26,7 | 26,7 | |
| Share premium | 240,3 | 240,3 | 240,3 | |
| Other equity | 222,2 | 179,9 | 219,0 | |
| Non controlling interests | 0,9 | 0,0 | 0,8 | |
| Total equity | 490,1 | 446,9 | 486,9 | |
| Pension liabilities | 12,7 | 9,5 | 12,2 | |
| Deferred tax liabilities | 1,5 | 6,2 | 0,3 | |
| Interest bearing long-term liabilities | 4 | 669,7 | 64,3 | 668,4 |
| Derivatives | -2,9 | 0,0 | 1,1 | |
| Total non-current liabilities | 681,0 | 80,0 | 682,0 | |
| Interest bearing short-term liabilities | 4 | 77,4 | 853,1 | 70,8 |
| Supplier liabilities | 86,8 | 121,3 | 135,3 | |
| Tax payable | 3,8 | 16,4 | 12,0 | |
| Social Security, VAT and other taxes | 81,9 | 77,1 | 72,3 | |
| Other short-term liabilities | 217,0 | 188,3 | 196,9 | |
| Derivatives | 0,0 | 7,2 | 0,0 | |
| Warranty liabilities | 19,8 | 19,1 | 19,8 | |
| Total Current Liabilities | 486,7 | 1 282,3 | 507,2 | |
| TOTAL EQUITY & LIABILITY | 1 657,8 | 1 809,3 | 1 676,0 |
Amounts in NOK million
| Equity | ||||||||
|---|---|---|---|---|---|---|---|---|
| attributable | Non | |||||||
| Share | Share | Conversion | Hedging | Retained | to parent | Contolling | ||
| capital | premium | reserve | reserve | earnings | Company | interests | Total equity | |
| 01. January 2021 | 26,7 | 240,3 | 2,3 | -0,9 | 217,6 | 486,1 | 0,8 | 486,9 |
| Net profit Other Comprehensive Income Changes in non-controlling |
-1,2 | 3,1 | 1,20 | 1,16 2,0 |
0,05 | 1,2 2,0 |
||
| interests | 0,0 | |||||||
| Equity as per 31.03.2021 | 26,7 | 240,3 | 1,2 | 2,3 | 218,8 | 489,2 | 0,9 | 490,1 |
| Amounts in NOK million | Equity | |||||||
|---|---|---|---|---|---|---|---|---|
| attributable | Non | |||||||
| Share | Share | Conversion | Hedging | Retained | to parent | Contolling | ||
| capital | premium | reserve | reserve | earnings | Company | interests | Total equity | |
| 01. January 2020 | 26,7 | 240,3 | 3,4 | -0,8 | 170,5 | 440,1 | 0,0 | 440,1 |
| Net profit | 9,1 | 9,1 | 9,1 | |||||
| Other Comprehensive Income | 2,5 | -4,8 | -2,3 | -2,3 | ||||
| Equity as per 31.03.2020 | 26,7 | 240,3 | 5,9 | -5,6 | 179,6 | 446,9 | 0,0 | 446,9 |
| Q1 | Q1 | YTD | YTD | FY | ||
|---|---|---|---|---|---|---|
| Amounts in NOK million | Note | 2021 | 2020 | 2021 | 2020 | 2020 |
| EBITDA | 38,4 | 36,7 | 38,4 | 36,7 | 216,7 | |
| Taxes paid | -8,2 | 0,0 | -8,2 | 0,0 | -16,4 | |
| Change in net working capital | 2,8 | -68,1 | 2,8 | -68,1 | -21,7 | |
| Changes to other time restricted items | 0,9 | 9,8 | 0,9 | 9,8 | -4,7 | |
| Net Cash flow from operating activities | 33,9 | -21,5 | 33,9 | -21,5 | 174,0 | |
| Capex | -9,9 | -2,6 | -9,9 | -2,6 | -17,2 | |
| Net cash flow from investing activities | -9,9 | -2,6 | -9,9 | -2,6 | -17,2 | |
| Net repayment of interest bearing debt | -5,2 | -4,7 | -5,2 | -4,7 | -186,9 | |
| Changes in non-controlling interests | 0,0 | 0,0 | 0,0 | 0,0 | 1,6 | |
| Net interest paid | 4 | -13,0 | -18,4 | -13,0 | -18,4 | -88,6 |
| Net cash flow from financing activities | -18,2 | -23,1 | -18,2 | -23,1 | -273,8 | |
| Total cash flow | 5,7 | -47,2 | 5,7 | -47,2 | -117,1 | |
| Opening balance net bank deposits | 139,7 | 256,8 | 139,7 | 256,8 | 256,8 | |
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 2020 provides further information on risks and uncertainties applicable to Beerenberg.
Shareholders in Beerenberg AS are specified in table below.
| Shareholders | A-Shares | % | B-Shares | % | Total Shares | % |
|---|---|---|---|---|---|---|
| Segulah IV L.P. | 833 732 | 83,4 % | 223 247 653 | 83,9 % | 224 081 385 | 83,9 % |
| AlpInvest Partners Co-Investments 2012 I C.V. | 92 121 | 9,2 % | 24 931 110 | 9,4 % | 25 023 231 | 9,4 % |
| AlpInvest Partners Co-Investments 2011 II C.V. | 23 319 | 2,3 % | 6 310 883 | 2,4 % | 6 334 202 | 2,4 % |
| Management | 50 828 | 5,1 % | 11 510 354 | 4,3 % | 11 561 182 | 4,3 % |
| Total | 1 000 000 | 100,0 % | 266 000 000 | 100,0 % | 267 000 000 | 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 2020. The accounting policies applied in the interim financial statements is the same as those described in the Annual Report for 2020.
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 2020 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 2020. Please refer to Note 3 in the Annual Report for 2020.
A 3-year Senior Secured Bond of MNOK 750 was issued in Q4 2020, and the previous bond of MNOK 850 was repaid. In total Beerenberg repaid MNOK 100 and acquired MNOK 50 in own bonds. Discount on nominal value on Bond has been classified net with the Bond. The bond has, every 6-month, amortization of MNOK 25 until maturity, in total MNOK 125. The maturity date of the bond is 13 November 2023.
In connection with the bond issue Beerenberg has signed an MNOK 150 super senior credit facility agreement with Danske Bank.
The Facility agreement includes covenants related to quarterly Net Total Leverage ratio test (below 8.0 Q1 2021). The group is in compliance with covenants as of 31st of March 2021.
Amortization due within one year is presented as interest-bearing short-term liabilities.
No related party transactions were conducted in 1st Quarter of 2021.
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 topside and subsea.
| Q1 | Q1 | YTD | YTD | FY | |
|---|---|---|---|---|---|
| Amounts in NOK million | 2021 | 2020 | 2021 | 2020 | 2020 |
| Services | 364,1 | 404,3 | 364,1 | 404,3 | 1 431,1 |
| Benarx | 92,4 | 89,0 | 92,4 | 89,0 | 341,9 |
| Eliminations | -20,5 | -13,3 | -20,5 | -13,3 | -50,3 |
| Total | 436,0 | 480,0 | 436,0 | 480,0 | 1 722,7 |
| Q1 | Q1 | YTD | YTD | FY | |
|---|---|---|---|---|---|
| Amounts in NOK million | 2021 | 2020 | 2021 | 2020 | 2020 |
| Services | 26,3 | 28,1 | 26,3 | 28,1 | 166,6 |
| Benarx | 12,1 | 8,6 | 12,1 | 8,6 | 50,0 |
| Other | 0,0 | 0,0 | 0,0 | 0,0 | 0,0 |
| Total | 38,4 | 36,7 | 38,4 | 36,7 | 216,7 |
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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