Aker — Interim / Quarterly Report 2017

May 11, 2017

Proud ownership

Aker ASA First-quarter results 2017

11 May 2017 | Fornebu

Highlights | First quarter 2017

• Net asset value: down 5.1% to NOK 32.6 billion (NOK 34.3 billion)
• Cash and liquid fund inv.: NOK 4.3 billion, down from NOK 4.9 billion in the fourth quarter
• Return: Aker share up 2.8% to NOK 332 vs. OSEBX up 0.6%
• Dividend: NOK 16 per share cash dividend for 2016 (5.0% yield and 3.5% of NAV per 31.12.16)
• Aker transactions:
• i. Farstad Shipping: Acquisition of shares in Farstad Shipping
• ii. Financing: Repayment of the NOK 500 million AKER08 bond and exercise of call option under the NOK 500 million AKER07 bond
• Portfolio transactions:
• i. Aker Solutions: Acquisition of the oil service provider Reinertsen
• ii. Aker BioMarine: Signed contract to build a new krill fishing vessel
• iii. Solstad Offshore: EGM approval of merger between Solstad Offshore, Farstad Shipping and Deep Sea Supply

NAV decreased 5% in 1Q 2017 to NOK 32.6 billion

Net asset value change in 1Q 2017 NOK billion

Total return portfolio companies in 1Q 2017 Percentage change, adjusted for dividends

Share price gained 3% in Q1, balance sheet de-leveraged

NAV per share vs. share price NOK per share

Net asset value composition NOK billion

Dividend

NAV per share

Share price (adjusted for dividends paid in Q2 2016)

Oil services share of portfolio increasing

Portfolio composition NOK billion, as per 1Q 2017

					Listed investments Unlisted investments
Industrial Holdings				Financial Investments
Aker BP	40.0%	18.6	3.9	Cash
1)) Aker Solutions	34.8%	4.9	0.4	Liquid fund investments
1)) Akastor	36.7%	1.3	1.4	Listed financial investments
1) Kvaerner	28.7%	0.8	0.4	Real Estate Investments2)
Ocean Yield	66.2%	6.0	1.5		Other financial investments2)
2) Aker BioMarine	99.5%	1.4
Gross asset value		33.0	7.6
Net asset value			32.6

Gross asset value distribution Per 1Q 2017 (4Q 2016)

1)Owned partly through Aker Kvaerner Holding, in which Aker has a 70% ownership interest. Additionally, Aker has a direct ownership interest in Aker Solutions and Akastor 2)Reflected at book value

Strong upstream cash generation and solid cash position

Investment capacity potential NOK billion

Upstream dividend NOK billion

(April)

sources

Aker Industrial Holdings

Industrial Holdings Aker BP

Exploration & Production company on the Norwegian continental shelf

% of gross asset value

(1Q 2017)

Investment value of NOK 18.6 billion

Aker's ownership agenda

• Growth; organic (greenfield projects, IOR and exploration) and through M&A
• Quarterly dividend payments
• Operational excellence and efficiency improvements through new business models and technologies

Aker's investment

NOK million
Value as per 31.12.16		20 873
Value change in 1Q		(2 075)
Received dividends		(208)
Value as per 31.03.17		18 590
Key figures
USD million	1Q 16	1Q 17
Revenues	205	646
EBITDAX	165	517

Industrial Holdings Aker Solutions

Global oil services company providing services, technologies, and product solutions within subsea and field design

% of gross asset value

(1Q 2017)

Investment value of NOK 4.9 billion

Aker's ownership agenda

• Increase competitiveness and reduce costs by NOK 9 billion across the business versus 2015 cost base
• Win new contracts
• Partnerships, alliances and M&A

Aker's investment

NOK million
Value as per 31.12.16	3 912
Value change in 1Q	982
Value as per 31.03.17	4 894

NOK million	1Q 16	1Q 17
Revenues	6 463	5 173
EBITDA	508	355
Backlog	38 493	30 709

Industrial Holdings

Akastor

Oilfield services investment company with a flexible mandate for longterm value creation

% of gross asset value

(1Q 2017)

Investment value of NOK 1.3 billion

Aker's ownership agenda

• Operational excellence, cost reductions
• Win new contracts
• Transactions

Aker's investment

NOK million
Value as per 31.12.16	1 629
Value change in 1Q	(327)
Value as per 31.03.17	1 302

NOK million	1Q 16	1Q 17
Revenues	1 353	1 018
EBITDA	(48)	59
Backlog	12 078	7 394

Industrial Holdings Kvaerner

Oil and gas-related EPC company

% of gross asset value

(1Q 2017)

Investment value of NOK 0.8 billion

Aker's ownership agenda

• Enhance competitiveness through operational excellence and cost reductions
• Win new contracts
• Maintain strong balance sheet

Aker's investment

NOK million Value as per 31.12.16 935 Value change in 1Q (100) Value as per 31.03.17 834

NOK million	1Q 16	1Q 17
Revenues	2 228	1 554
EBITDA	81	108
Backlog	12 054	10 841

Industrial Holdings Ocean Yield

A maritime assets company with focus on long-term contracts

% of gross asset value

(1Q 2017)

Investment value of NOK 6.0 billion

Aker's ownership agenda

• Growth by incremental, accretive investments
• Further diversify portfolio, both counterparty and segmentwise
• Optimise capital structure and reduce cost of capital
• Manage and mitigate counterparty risk

Aker's investment

NOK million
Value as per 31.12.16		6 386
Value change in 1Q		(241)
Received dividends		(151)
Value as per 31.03.17	5 993
Key figures
USD million	1Q 16	1Q 17
Revenues	66	78
EBITDA	59	71
Backlog (on EBITDA basis)	2 600	2 800

Industrial Holdings Aker BioMarine

Integrated biotech company – specialised in krill harvesting and processing

% of gross asset value

(1Q 2017)

Investment value of NOK 1.4 billion

Aker's ownership agenda

• Operational excellence
• Increase sales by entering new products, channels and geographies
• New vessel and other investments to fast-track growth

Aker's investment

NOK million
Value as per 31.12.16 (book value)	1 405
Value change in 1Q	-
Value as per 31.03.17 (book value)	1 405

USD million	1Q 16	1Q 17
Revenues	25	28
EBITDA	7	3

Aker Financial Investments

Financial Investments Overview

% of gross asset value NOK billion (1Q 2017)

• Cash reduced to NOK 3.9 billion. NOK 4.3 billion incl. liquid fund investments
• AKER08 repayment at maturity of NOK 0.5 billion
• Participation in the Farstad Shipping equity issue as part of planned merger between Solstad Offshore, Farstad Shipping and Deep Sea Supply
• Down-payment on USD bank loan equal to dividend received from Aker BP
• Increased value of American Shipping Company

Financial Investments

Liquid fund investments

Cash

Financial Investments

Cash and Liquid fund investments

% of gross asset value

(1Q 2017)

Key events 1Q

• Cash decreased to NOK 3.9 billion:
• • NOK 410 million in dividends received
• • NOK 143 million in repaid receivables
• NOK 710 million in debt repayments
• NOK 210 million participation in Farstad Shipping equity issue
• NOK 164 million in operating expenses and net interest paid
• NOK 14 million in net other cash movements
• Liquid fund investments at NOK 410 million

Financial Investments Listed financial investments

% of gross asset value (1Q 2017)

• NOK 210 million participation in Farstad Shipping equity issue as part of planned merger between Solstad Offshore, Farstad Shipping and Deep Sea Supply
• Total value of AMSC exposure increased by NOK 137 million
• Value of Philly Shipyard decreased by NOK 33 million
• Dividends received of NOK 37 million

Aker's investment

NOK million	3Q 16	4Q 16	1Q 17
Philly Shipyard	803	447	414
AMSC (incl. TRS)	311	295	432
Cxense	65	66	47
Solstad Offshore	310	247	255
Farstad Shipping	-	-	204
Total value	1 490	1 055	1 353

Financial Investments

Real estate and other financial investments

% of gross asset value (1Q 2017)

• Loan repayment from Fornebuporten of NOK 50 million
• Loan repayment from AMSC of NOK 57 million
• NOK 14 million in dividend received from Norron AB

Aker's investment

326	426	376
1 678	1 594	1 517
2 004	2 020	1 893

Aker Financial Statements

Balance sheet

(after dividend allocation of NOK 16 per share)

Interest-bearing items and loan guarantees

• Interest-bearing receivables
• Interest-bearing debt

Interest-bearing debt (MNOK)	Loan amount	Outstanding	Maturity
Bond AKER 11	1 300	1 300	2018
Bond AKER 07	500	500	2019****
Bond AKER 12	1 443	1 443	2019*
Bond AKER 13	1 000	1 000	2020
Bond AKER 10	700	700	2020
Bond AKER 09	1 000	1 000	2022
Bank loan (RCF)	1 000	0	2020**
Capitalised loan fees etc.	(24)	(24)
Total Aker ASA	6 919	5 919
Bank loan Aker Capital (USD denominated)	1 715	1 715	2019***
Capitalised loan fees etc.	(8)	(8)
Total Aker ASA and holding companies	8 625	7 625

Loan guarantees	4Q 2016	1Q 2017
Aker BioMarine	305	305
Ocean Harvest	59	56
Other	3	3
Total	367	364

Average debt maturity is 2.6 years

Financial Covenants	Limit	Status per 31.03.2017
i Total Debt/Equity - Aker ASA (parent only)	< 80%	40%
ii Group Loans to NAV or Group Loans	< 50% < NOK 10 bn	1.1% NOK 0.4 bn

* MSEK 1 500 issue **Maturity in 2020 with 1 year uncommitted extension option

*** Maturity in 2019 with 1+1 years uncommitted extension options ****Called and paid in April '17

Aker ASA and holding companies Income statement

Amounts in NOK million	1Q 2016	4Q 2016	1Q 2017	Year 2016
Sales gains	188	-	-	1 906
Operating expenses	(60)	(72)	(63)	(198)
EBITDA	129	(72)	(63)	1 708
Depreciation and impairment	(5)	(3)	(4)	(32)
Value change	(314)	209	134	(8)
Net other financial items	108	132	444	950
Profit before tax	(83)	266	511	2 617

Disclaimer

• This Document includes and is based, inter alia, on forward-looking information and statements that are subject to risks and uncertainties that could cause actual results to differ. These statements and this Document are based on current expectations, estimates and projections about global economic conditions, the economic conditions of the regions and industries that are major markets for Aker ASA and Aker ASA's (including subsidiaries and affiliates) lines of business. These expectations, estimates and projections are generally identifiable by statements containing words such as "expects", "believes", "estimates" or similar expressions. Important factors that could cause actual results to differ materially from those expectations include, among others, economic and market conditions in the geographic areas and industries that are or will be major markets for Aker's businesses, oil prices, market acceptance of new products and services, changes in governmental regulations, interest rates, fluctuations in currency exchange rates and such other factors as may be discussed from time to time in the Document. Although Aker ASA believes that its expectations and the Document are based upon reasonable assumptions, it can give no assurance that those expectations will be achieved or that the actual results will be as set out in the Document. Aker ASA is making no representation or warranty, expressed or implied, as to the accuracy, reliability or completeness of the Document, and neither Aker ASA nor any of its directors, officers or employees will have any liability to you or any other persons resulting from your use.
• The Aker group consists of many legally independent entities, constituting their own separate identities. Aker is used as the common brand or trade mark for most of this entities. In this document we may sometimes use "Aker", "Group, "we" or "us" when we refer to Aker companies in general or where no useful purpose is served by identifying any particular Aker company.