AI assistant
Aker Solutions — Earnings Release 2018
Oct 24, 2018
3531_rns_2018-10-24_3a48c80f-f451-4829-bb4f-b21d6b924b20.html
Earnings Release
Open in viewerOpens in your device viewer
Aker Solutions ASA: Third-Quarter Results 2018
Aker Solutions ASA: Third-Quarter Results 2018
October 24, 2018 - Aker Solutions' earnings strengthened in the third quarter of
2018 as orders more than doubled from a year earlier amid increasing signs of a
market recovery.
Financial Highlights
* Revenue NOK 6.5 billion
* EBITDA NOK 463 million
* EBITDA margin 7.1%
* EBITDA ex. special items NOK 492 million
* EBITDA margin ex. special items 7.5%
* Earnings per share ex. special items NOK 0.60
* Order intake NOK 5.9 billion
* Order backlog NOK 36.1 billion
The company delivered strong execution on major projects globally and made good
progress on the second phase of its cost-efficiency program. These efforts
helped maintain margins compared with a year earlier.
"Our order intake in the quarter more than doubled versus the same period a year
earlier and we're seeing high tendering activity in all our markets," said Luis
Araujo, chief executive officer of Aker Solutions. "A main development this
quarter is that we are seeing increased order intake in key global markets such
as China, Brazil and Angola, in line with our strategic ambitions," he said.
Orders totaled NOK 5.9 billion in the quarter, bringing the backlog to NOK 36.1
billion.
Orders in the quarter included a contract from Petrobras to deliver a subsea
production system and related services at the Mero field development offshore
Brazil. Petrobras also awarded a contract to Aker Solutions for maintenance and
modifications services for nine oil and gas platforms at the Campos Basin. In
Angola, Aker Solutions secured a contract with BP to deliver brownfield services
at their Greater Plutonio and PSVM fields. China National Offshore Oil
Corporation (CNOOC) awarded Aker Solutions a contract to deliver power umbilical
systems to their Liuhua field. In the UK, Point Resources extended its
maintenance and modifications contract with Aker Solutions in the North Sea.
In the quarter, the company signed a frame agreement with Equinor for current
and future subsea projects. Aker Solutions also secured two 5-year framework
agreements for potential future deliveries of unmanned wellhead platforms and
subsea production systems and lifecycle services at ConocoPhillips-operated oil
and gas fields on the Norwegian shelf.
Aker Solutions won 33 front-end orders in the period, bringing the total for the
first three quarters of the year to 107. Almost a third of those orders are for
projects outside Norway.
Finances were solid, with a liquidity buffer of NOK 7.4 billion at the end of
the quarter.
Revenue and EBITDA
Revenue rose to NOK 6.5 billion in the quarter from NOK 5.4 billion a year
earlier, driven by increased North Sea modifications work and continued good
progress on a number of key projects across all business lines. Earnings before
interest, taxes, depreciation and amortization (EBITDA) were NOK 463 million,
compared with NOK 401 million a year earlier.
The EBITDA margin was 7.1 percent versus 7.4 percent a year earlier. Excluding
special items, the margin was 7.5 percent compared with 7.8 percent a year
earlier.
Aker Solutions has two reporting segments: Projects and Services. Revenue in
Projects rose to NOK 5.2 billion in the quarter from NOK 4.2 billion a year
earlier, mainly driven by recent strong order intake and ongoing North Sea
modification and hook-up jobs. Excluding special items, EBITDA margin was 7.2
percent in the quarter versus 7.7 percent a year earlier.
Revenue in Services rose to NOK 1.3 billion in the quarter from NOK 1.2 billion
a year earlier, driven by international growth in the company's production asset
services sub-segment. Excluding special items, the EBITDA margin was 14.9
percent in the quarter compared with 13.5 percent a year earlier.
Outlook
The outlook for oil services remains competitive and there is pressure on
pricing. Still, there are increasing signs of a recovery amid lower break-even
costs and higher oil prices.
Tendering activity is high in the company's main markets. Aker Solutions is
bidding for contracts totaling about NOK 45 billion. About two-thirds of these
are in the subsea area, where the company expects key projects to be awarded
over the next six to 12 months, including in Brazil, the UK, Africa, Australia
and Asia Pacific.
For 2018, Aker Solutions continues to see overall revenue up by close to 10
percent from 2017, helped by the strong order intake and performance year to
date. Underlying 2018 EBITDA margins are expected to remain around year-to-date
levels, supported by solid execution and the company's improvement program.
Aker Solutions sees overall revenue in 2019 slightly up from 2018, on the back
of our strong order intake year-to-date, and continued high tendering activity
with underlying 2019 EBITDA margin expected to remain around full-year 2018
levels.
ENDS
Media Contact:
Tor Odland, tel: +47 22 94 60 80, mob: +47 990 90 872, e-mail:
Investor Contact:
Fredrik Berge, tel: +47 22 94 62 19, mob: +47 450 32 090, e-mail:
Aker Solutions helps the world meet its energy needs. We engineer the products,
systems and services required to unlock energy. Our goal is to maximize recovery
and efficiency of oil and gas assets, while using our expertise to develop the
sustainable solutions of the future. Aker Solutions employs approximately
14,000 people in more than 20 countries.
Visit akersolutions.com and connect with us on Facebook, Instagram, LinkedIn,
Twitter and YouTube.
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.