AF Gruppen

Earnings Release • May 12, 2017

Yet another good result for AF Gruppen

Yet another good result for AF Gruppen

AF Gruppen's order volume grew and the company delivered a good

result for Q1. Orders in hand are record high and the company's

financial position is strong.

Turnover in Q1 was NOK 2,662 million (2,707). Earnings before tax

were NOK 142 million (186 million) in Q1, corresponding to a profit

margin of 5.4 per cent (6.9 per cent) for the quarter.

AF Gruppen's order backlog as at 31/03/2017 was NOK 15,984 million

(10,623 million). Net operating cash flow was NOK 415 million (152

million) in the 1st quarter.

AF imposes the same strict requirements to safety on all its

partners and suppliers as on its own employees. Figures from the

subcontractors are therefore included in the injury statistics. The

LTI rate for the 1th quarter was 1.1 (2.1). Total sickness absence

for Q1 was 3.5 % (4.3 %).

AF Gruppen has a strong financial position, and the group had net

interest-bearing receivables of NOK 1,063 million (705 million) as

at 31/03/2017.

The agreement to acquire 70 per cent of the shares in Kanonaden

Entreprenad AB was concluded on 9 February 2017. Kanonaden

Entreprenad AB and its subsidiaries reported revenues of SEK 708

million in 2016 and had 188 employees.

"AF Gruppen reports good earnings for Q1. An increased contract

volume and numerous interesting contracts from existing and new

customers has resulted in a record high order backlog.

A milestone in the quarter was the start of Norway's largest

construction project E18 Tvedestrand-Arendal. As the first project

under the auspices of Nye Veier, the project will be closely

monitored, not least locally. After a fast mass-mobilization of both

the project organization and equipment, the construction work is

fully operative.

Activity is also at a peak at AF Miljøbase Vats near Haugesund. The

facility specializes in sorting waste from decommissioned offshore

installations and is proof that environmental and safe disposal of

old installations can be carried out industrially and efficiently.

Our strong financial position allows us to distribute a dividend to

our shareholders while also strengthening our positions through

acquisitions. With the acquisition of Kanonaden Entreprenad, AF's

strategy in Sweden is materializing. The acquisition proves that our

model of local co-ownership is attractive for well run and

profitable businesses.

Our team comprises skilled project teams and associates who want to

succeed along with the customers," says CEO Morten Grongstad of AF

Gruppen.

For further information, contact:

Morten Grongstad, CEO, mobile +47 991 53 905

Sverre Hærem, CFO, mobile +47 952 45 167

Wibecke Brusdal, Director Corporate Communications, mobile +47 930

93 150

www.afgruppen.no