Aker Solutions — Earnings Release 2016

Feb 9, 2017

CORRECTION: Aker Solutions ASA: Fourth-Quarter Results 2016

CORRECTION: Aker Solutions ASA: Fourth-Quarter Results 2016

This is a correction of the announcement from 07:00

09.02.2017 CET. Reason for the correction:

EBITDA ex. special items has been corrected to NOK 327

million from NOK 32.7 million in the Subsea table on page 13

in the report. The updated 4Q 2016 report is attached.

February 9, 2017

Financial Highlights

Sales NOK 6.1 billion in 4Q 2016 vs NOK 7.9 billion in 4Q

2015

EBITDA NOK 380 million vs NOK 182 million a year earlier

EBITDA margin 6.2% vs 2.3% a year earlier

EBITDA margin ex. special items 8.8% vs 8.9% a year earlier

Loss before interest and taxes NOK 232 million vs NOK 155

million a year earlier

EBIT margin -3.8% vs -2% a year earlier

EBIT margin ex. special items 5.6% vs 6.1% a year earlier

Loss per share NOK 1.07 vs NOK 0.83 a year earlier

Earnings per share ex. special items NOK 0.62 vs NOK 0.96

Order intake NOK 4.1 billion vs NOK 6.4 billion a year

earlier

Order backlog NOK 31.2 billion vs NOK 39.7 billion a year

earlier

Board recommends zero dividend for 2016

Aker Solutions delivered strong execution on major projects

globally and pushed ahead of schedule with improvement

efforts that supported margins in the fourth quarter of

The company has completed about two-thirds of a program to

boost cost-efficiency across the business by at least 30

percent by the end of 2017. It is also driving through a

reorganization to streamline and strengthen operations after

establishing five delivery centers in November that replaced

the former business area structure.

"Our companywide operational improvements gathered pace in

the quarter, supporting margins amid the sustained slowdown

in the oil and gas industry," said Luis Araujo, chief

executive officer of Aker Solutions. "We are also benefiting

from a solid financial position and good customer

relationships as we quarter-by-quarter deliver consistently

strong execution on projects from Norway to Brazil and

Africa."

The company in the quarter acquired 70 percent of Brazilian

C.S.E. Mecânica e Instrumentação Ltda., building on a

strategy to expand its services business internationally. It

won NOK 4.1 billion in orders, including two contracts from

DEA to deliver the subsea production system, maintenance and

services at Norway's Dvalin development and two framework

agreements from BP for concept and front-end engineering

services globally. The company saw continued solid interest

in its front-end engineering capabilities, winning 24 study

awards for projects in Norway, the U.S., West Africa and

Asia Pacific. This brought the total number of studies won

last year to a record of more than 80.

The order backlog was NOK 31.2 billion at the end of the

quarter, about 60 percent of which was for projects outside

Norway. Finances were solid, with a liquidity buffer of NOK

7.5 billion at the end of the period.

The board of directors proposes that no dividend payment be

made for 2016. While Aker Solutions had a solid financial

position at the end of 2016, the board deems it prudent to

exercise caution amid continued uncertainty about the

outlook for the oil and gas industry. The company maintains

its policy of paying a dividend of between 30 and 50 percent

of net profit over time.

Aker Solutions' revenue decreased to NOK 6.1 billion in the

quarter from NOK 7.9 billion a year earlier amid the global

market slowdown. The company posted a loss before interest

and taxes of NOK 232 million in the quarter compared with a

loss of NOK 155 million a year earlier. This was equal to a

margin of minus 3.8 percent versus minus 2 percent a year

earlier.

Earnings were negatively impacted by special items of NOK

574 million compared with a negative impact of NOK 636

million a year earlier. Excluding special items, the company

had earnings before interest and taxes (EBIT) of NOK 342

million in the quarter versus NOK 481 million a year earlier

while the margin was 5.6 percent versus 6.1 percent.

Aker Solutions has two reporting segments: Subsea and Field

Design. Subsea revenue fell to NOK 3.4 billion in the

quarter from NOK 4.8 billion a year earlier as demand slowed

and some projects neared completion. The EBIT margin

contracted to minus 7.6 percent from 1.5 percent a year

earlier, impacted by NOK 391 million in impairment charges

on technology and plant property and NOK 31 million in

restructuring costs. Excluding special items, the margin was

4.9 percent in the quarter.

Revenue in Field Design, which consists of MMO and

Engineering, declined to NOK 2.8 billion in the quarter from

NOK 3.2 billion a year earlier. The decrease was driven by

MMO, where some major projects neared completion and volumes

were small from start-up projects. The EBIT margin improved

to 6.2 percent in the quarter from minus 1.6 percent a year

earlier, helped by good project execution, improved activity

levels in MMO and high capacity utilization in Engineering.

Excluding special items, the margin was 7.2 percent in the

quarter.

Outlook

The outlook for oil services remains challenging. There are

some signs of a recovery, primarily in the brownfield

segment, and oil prices are seen stabilizing at a higher

level in 2017. Increased demand for front-end engineering

services is also an early indication of a pickup in activity

ahead. Industry cost cuts are having an effect, with break-

even costs coming down on developments. This is expected to

spur new industry investments and project sanctions this

year. Tendering activity is healthy and totals about NOK 50

billion.

As previously indicated, the company sees overall revenue

down by about 10-15 percent in 2017 from the prior year as

an anticipated modest pickup in activity for maintenance and

modifications services is offset by weaker subsea volumes.

Underlying EBITDA margins are seen slightly down year-on-

year due to a continued market slowdown and changing revenue

mix. This will be partially offset by a continued strong

momentum from the company's global improvement program.

ENDS

For further information, please contact:

Media:

Bunny Nooryani, Chief Communications Officer, Aker

Solutions. Tel: +47 67 59 42 71, Mob: +47 480 27 575, E-

mail: bunny.nooryani@akersolutions.com

Anne Cecilie Lund-Andersen, Media Relations Manager, Aker

Solutions. Tel: +47 22 94 74 52, Mob: +47 99 62 12 13, E-

mail: anne.cecilie.lund-andersen@akersolutions.com

Investors:

Per Christian Olsen, Analyst, Investor Relations, Aker

Solutions. Tel: +47 67 51 36 58, Mob: +47 900 29 077, E-

mail: per.christian.olsen@akersolutions.com

Aker Solutions is a global provider of products, systems and

services to the oil and gas industry. Its engineering,

design and technology bring discoveries into production and

maximize recovery. The company employs approximately 14,000

people in about 20 countries. Go to http://akersolutions.com

for more information on our business, people and values.

This press release may include forward-looking information

or statements and is subject to our disclaimer, see

http://akersolutions.com

This information is subject of the disclosure requirements

pursuant to section 5-12 of the Norwegian Securities Trading

Act.