Aker — Interim / Quarterly Report 2018

May 9, 2018

First-quarter 2018 highlights

Financial key figures prior to dividend allocation (Aker ASA and holding companies)

• n The net asset value ("NAV") of Aker ASA and holding companies ("Aker") increased by 1.6 per cent in the first quarter to NOK 42.4 billion, compared to NOK 41.8 billion at the end of the fourth quarter. Per-share NAV amounted to NOK 571 at the end of the first quarter, compared to NOK 562 as of 31 December 2017.
• n The Aker share increased 9.3 per cent in the first quarter, compared to a 1.1 per cent decline in the Oslo Stock Exchange's benchmark index ("OSEBX").
• n The value of Aker's Industrial Holdings portfolio rose to NOK 44.9 billion in the first quarter, up from NOK 44.6 billion as per year-end 2017. The value of Aker's Financial Investments portfolio stood at NOK 7.3 billion at the end of the first quarter, up from NOK 5.8 billion as per 31 December 2017.
• n Aker's Annual General Meeting approved on 20 April 2018 the distribution of NOK 18 per-share ordinary cash dividend for 2017, which represents a 4.5 per cent yield to the share price and 3.2 per cent of NAV at the close of 2017. In total, NOK 1.3 billion was paid out in early May.
• n Aker's liquidity reserve, including undrawn credit facilities, stood at NOK 5.2 billion as per 31 March 2018. Cash and liquid fund investments amounted to NOK 2.9 billion at the end of the first quarter, up from NOK 1.7 billion as per year-end 2017.
• n The value-adjusted equity ratio was 81 per cent, down from 83 per cent per 31 December 2017.

Key events in the quarter

• n Aker successfully raised NOK 1.5 billion in a new unsecured bond with maturity in January 2023. The bonds carry a coupon of 3 months NIBOR + 2.65 per cent p.a.
• n Aker announced that Aker Energy, a 50-50 joint venture between Aker and The Resource Group TRG AS, had entered into an agreement to acquire Hess Corporation's 50 per cent participating interest in the Deepwater Tano Cape Three Points block in Ghana.
• n Oceanwood and Aker decided to terminate the agreement, which comprised bidding for the shares in Norske Skog AS, as the parties did not come to an agreement regarding the terms of a joint bid.
• n Aker Solutions announced the successful completion of a new NOK 1.5 billion unsecured bond issue with maturity in July 2022.
• n Kvaerner announced a NOK 3.8 billion contract with Statoil for delivery of the topside modules for the Johan Castberg FPSO, as well as for hook-up and integration.
• n Aker BP announced that the company intends to raise the dividend level in 2018 to USD 450 million, with an ambition to increase the level by USD 100 million annually to 2021. The increase in 2018 represents an additional USD 80 million in upstream cash to Aker.
• n Aker BP completed the issuance of USD 500 million in senior notes due 2025, carrying a 5.875 per cent fixed coupon.
• n Ocean Yield announced the acquisition of four VLCC crude tankers with 15-year bareboat charters to Okeanis Marine Holdings SA for a total consideration of USD 297 million net after seller's credit.
• n Ocean Yield completed a NOK 759 million private placement of 11 million new shares at a subscription price of NOK 69. Aker presubscribed for 50 per cent, but was allocated zero shares due to strong demand, diluting Aker's ownership stake to 61.7 per cent.

Main contributors to gross asset value

(NOK billion)

Representing 87 per cent of total gross asset value of NOK 52.2 billion

Net asset value and share price (NOK per share)

The balance sheet and income statement for Aker ASA and holding companies (Aker) have been prepared to show the financial position as a holding company. Net asset value (NAV) is a core performance indicator at Aker ASA. NAV expresses Aker's underlying value and is a key determinant of the company's dividend policy (annual dividend payments of 2-4 per cent of NAV). Gross asset value is determined by applying the market value of exchange-listed shares, while book value is used for other assets. The same valuation principles apply to fund investments. Net asset value is gross asset value less liabilities.

Letter from the CEO

Dear fellow shareholders,

Aker has continued on an upward trajectory in 2018. Net Asset Value was up 1.6 per cent in the first quarter, while the NAV and share price are up 30 and 41 per cent year-to-date, respectively, including a NOK 18 per share cash dividend distributed in May. Compared to the reference index Aker has generated an excess return of 33 per cent year-to-date. Once again, Aker BP is the main contributor to our value development. Activity in the oil service industry is picking up along with rising oil prices, and Aker's portfolio companies have used the downturn well, also to prepare for recovery, resulting in a strong order intake.

Activity remains high, both in Aker and our portfolio companies. New steps are taken each day in an effort to continuously improve and create value. The excellent interaction we have with our portfolio companies allows us to succeed with the strategic agenda set. The ambition is always to realize the full value potential of our portfolio. I'm impressed by how Aker's portfolio companies have developed over the last years, despite the challenging markets we have faced.

The ambition is always to realize the full value potential of our portfolio

Take Ocean Yield as an example, a company with 15 vessels in the portfolio spread across seven counterparties at the end of 2014. When the oil and gas downturn started, almost 70 per cent of Ocean Yield's backlog was related to the offshore sector. Since then, the company has successfully diversified the portfolio and reduced the concentration risk through selective growth, and managed two restructurings. After an active first quarter where Ocean Yield invested more than USD 400 million in new assets, the fleet currently counts 51 vessels. New segments have been entered into and new client relationships have been established.

I'm impressed by how Aker's portfolio companies have developed over the last years, despite the challenging markets we have faced

Aker's oil services companies have used the recent years to increase competitiveness and productivity by cutting costs, streamlining operations and by applying new business models and technologies. As activity has picked up along with higher oil prices and improved E&P cash flows, we are starting to see the results of dedicated work. Collectively, Aker Solutions, Akastor and Kvaerner have succeeded in winning new orders for more than NOK 30 billion over the last six months, several of them of high strategic importance. Critical decisions and measures have been taken to get to where we are today, and it would not have been possible without trusted client relationships and the excellent collaboration we enjoy with union representatives in our portfolio companies.

Collectively, Aker Solutions, Akastor and Kvaerner have succeeded in winning new orders for more than NOK 30 billion over the last six months

The downturn has shown a significant willingness and ability to adapt, both within E&P companies and in the oil service industry. In 2015, when the industry was at its darkest, Aker saw the need to revitalize the Norwegian Continental Shelf ("NCS") by making real changes and tangible improvements. We believed it was possible to reduce costs by 30-50 per cent, without comprising the profitability of the oil service industry. These initiatives included simplification, more standardization, value chain improvements and enhanced interaction between suppliers and oil companies. We stated that the ambition was to make the NCS an international reference point for safe, profitable and sustainable petroleum activity at sea.

The downturn has shown a significant willigness and ability to adapt

KonKraft, a collaborative arena to strengthen the competitiveness on the NCS, brought our initiatives forward. A report published by KonKraft in February, which contains a number of recommendations to enhance efficiency, has been widely applauded by the industry and the authorities. These initiatives will open up for new types of collaboration and digitalized interaction. As an active industrial owner in Aker BP, Aker Solutions, Akastor, Kværner and our digitalization company Cognite, Aker will be a driving force in this important work.

Through Aker BP, we have put action behinds our words. We work smarter and more efficiently with closer interaction with the oil service providers and by applying new digital tools. We take this knowledge and experience with us in the development of Aker Energy in Ghana.

The key to success in the oil and gas industry is, and will still be, cooperation and interaction to promote a sustainable and profitable future.

Øyvind Eriksen President and CEO

Aker ASA and holding companies Assets and net assets value

Net asset value (NAV) composition - Aker ASA and holding companies

	As of 31.12.2017		As of 31.03.2018
	NOK/share	NOK million	NOK/share	NOK million
Industrial Holdings	600	44 560	604	44 916
Financial Investments	78	5 829	98	7 304
Gross assets	678	50 389	703	52 220
Total liabilities (before dividend allocation)	(116)	(8 618)	(132)	(9 794)
NAV (before dividend allocation)	562	41 771	571	42 425
Net interest-bearing receivables/(liabilities)		(5 608)		(5 284)
Number of shares outstanding (million)		74.296		74.306

Net asset value ("NAV") is a core performance indicator at Aker ASA. NAV expresses Aker's underlying value and is a key determinant of the company's dividend policy (annual dividend payments of 2-4 per cent of NAV). Net asset value is determined by applying the market value of exchange-listed shares, while book value is used for other assets. The same valuation principles apply to fund investments. Aker's assets (Aker ASA and holding companies) consist largely of equity investments in the Industrial Holdings segment, and of cash, receivables and fund investments in the Financial Investments segment. Other assets consist mainly of intangibles and tangible fixed assets. The charts above show the composition of Aker's assets. The business segments are discussed in greater detail on pages 5-7 of this report.

Aker – Segment information Industrial Holdings

		31.12.2017	1Q 18			31.03.2018
Amounts in NOK million	Ownership in %	Value	Net investments	Received dividends	Other changes	Value change	Value
Aker BP	40.0	29 083	-	(354)	-	1 838	30 567
Ocean Yield	61.7	6 828	-	(148)	-	(196)	6 484
Aker Solutions	34.8	4 368	-	-	-	(448)	3 920
Akastor	36.7	1 649	-	-	-	(117)	1 533
Aker BioMarine*	100.0	1 411	-	-	-	-	1 411
Kvaerner	28.7	1 220	-	-	-	(219)	1 001
Total Industrial Holdings		44 560	-	(502)	-	857	44 916

*Reflected at book value

The total value of Aker's Industrial Holdings increased by NOK 356 million in the first quarter to NOK 44.9 billion, mainly due to a NOK 857 million positive value change of the listed holdings. Aker received NOK 502 million in dividend payments from Aker BP and Ocean Yield in the quarter. The value of Aker's Industrial Holdings stood at NOK 44.6 billion as of 31 December 2017.

Of the NOK 857 million positive value change in the first quarter, Aker BP stood for NOK 1.8 billion. This was partly offset by a value decrease of NOK 448 million in Aker Solutions, NOK 219 million in Kvaerner, NOK 196 million in Ocean Yield and NOK 117 million in Akastor.

The book value of Aker's non-listed holding, Aker BioMarine, remained at NOK 1.4 billion as per 31 March 2018.

Aker BP

Aker BP is a fully-integrated E&P company operating on the Norwegian Continental Shelf ("NCS"). The company continues to deliver solid operational performance, reporting an EBITDAX of USD 712 million in the first quarter and production of 158.6 kboed. The Johan Sverdrup Phase I project is progressing according to plan and is now almost 70 per cent complete. The total project capex has been lowered by approximately 30 per cent since the Plan for Development and Operation ("PDO") was submitted in 2015, and the break-even oil price has been reduced below USD 15 per barrel. In February, Aker BP announced the Frosk discovery, estimated to contain between 30-60 mmboe (gross field). Aker BP holds a 65 per cent interest in Frosk, which will be tied back to the Alvheim FPSO securing improved utilization of existing facilities and infrastructure. In March, Aker BP raised USD 500 million in new senior notes at a fixed coupon of 5.875 per cent with maturity in 2025, further enhancing the company's financial position. In March, The Ministry of Petroleum and Energy approved the PDO's for the Valhall Flank Vest and the Skogul fields, and in April the Ærfugl PDO was approved. Aker BP paid a dividend

of USD 0.3124 per share in the quarter, of which Aker received NOK 354 million.

Ocean Yield

Ocean Yield is a ship-owning company with a mandate to build a diversified portfolio of modern vessels within oil services and shipping. The company targets fixed, long-term bareboat charters to credit-worthy counterparties. In the quarter, Ocean Yield continued to grow and diversify its backlog by completing three new transactions, comprising four VLCC crude tankers and seven handysize dry bulk vessels, all on long-term contracts. The total consideration paid was USD 408 million net after seller's credit and pre-paid charter hire. In order to increase the investment capacity further, Ocean Yield completed a NOK 759 million private placement through the issuance of 11 million new shares at a subscription price of NOK 69. Aker pre-subscribed for 50 per cent of the share issue, but was allocated zero shares to give priority to others investors and to improve the free float, reducing Aker's ownership stake to 61.7 per cent. Aker supports Ocean Yield's strategy of building a larger company over time through making value-accretive transactions and diversifying its portfolio further. Furthermore, a key priority in 2018 will be to reach a favourable outcome for FPSO Dhirubhai-1 as the current contract expires in September. As per the end of the quarter, Ocean Yield had an estimated EBITDA backlog of USD 3.5 billion and the average remaining contract tenor (weighted by EBITDA) was 11.4 years. The company continued to raise its dividend in the quarter, this time by USD 0.10 cents per share.

Aker Solutions

Aker Solutions is a global oil services company providing services, technologies, and product solutions within subsea and field design. Improving operational efficiency, reducing the cost base and nurturing existing and developing new customer relations are high on Aker's ownership agenda for Aker Solutions. In addition, Aker remains open to consider new alliances or structural alternatives if they are beneficial for the company and its shareholders. In the first quarter, Aker Solutions reported NOK 384 million in EBITDA adjusted for special items, and an order intake of NOK 8.6 billion supported by the award of several important contracts. In February, Aker Solutions entered into a longterm collaboration agreement with the digitalisation company Cognite to accelerate the development of digital solutions to improve efficiency through the oil and gas value chain. The ambition is to reduce overall costs, lower risks and improve performance. The backlog stood at NOK 37.6 billion as per the end of the first quarter Subsequent to the first quarter, Aker Solutions together with Kvaerner secured a letter of intent for modifications of the riser platform and field center of the Johan Sverdrup development, valued at NOK 3.4 billion, which will be split equally between the said companies.

Akastor

Akastor is an oil-services investment company with a flexible mandate for active ownership and long-term value creation. Aker encourages Akastor to play an active role in M&A, both to free up cash through the realization of assets and to selectively consider investment opportunities, albeit in a disciplined manner. In the first quarter, an important milestone for Akastor's portfolio company AKOFS Offshore was Aker Wayfarer successfully commencing operations on its five year contract with Petrobras. Subsequent to quarter end, Akastor's main asset MHWirth entered into a contract with Keppel FELS for delivery of a drilling equipment package, with options for further three packages. The award follows the contract for the delivery of a drilling package to the West White Rose Project awarded in fourth quarter, proving MHWirth's competitiveness in a very challenging rig market. Furthermore, Akastor announced a potential USD 75 million investment in perpetual preferred equity in Odfjell Drilling Ltd. Akastor continues to work closely with its portfolio companies to support cost saving programs, operational improvements and strategic initiatives to further enhance their competitiveness.

Aker BioMarine

Aker BioMarine is an integrated biotechnology company that supplies krill-derived ingredients to the consumer health and animal nutrition markets. Following the closing of the Enzymotec transaction, Aker BioMarine has successfully completed the integration of Enzymotec's client portfolio. In the first quarter, Aker BioMarine reported revenues of USD 35 million and an EBITDA of USD 3 million, corresponding to a margin of 9.6 per cent. The market for omega-3 products is recovering, which is the key market for Aker BioMarine's core products Qrill™ Aqua and Superba™ krill oil. Aker continued to support the company financially in the first quarter and the outstanding balance under the revolving credit facility was USD 133 million as per the end of the first quarter. In order to strengthen Aker BioMarine's balance sheet, Aker will convert NOK 1.0 billion of the outstanding receivable to equity in the second quarter. Aker remain positive to the long-term outlook for the company and the market for krill-derived products.

Kvaerner

Kvaerner is an oil and gas-related EPC company, mainly focused on the NCS. In March, Karl Petter Løken was appointed CEO, succeeding Jan Arve Haugan who assumed the position as CEO of Aker Energy. Kvaerner continued to deliver strong operational performance in the first quarter, reporting an EBITDA of NOK 193 million. Despite strong results, Kvaerner remains committed to further improve efficiency in order to strengthen the competitiveness, coupled with focus on operational excellence. In the quarter, Kvaerner was awarded a NOK 3.8 billion contract for delivery of the topside modules for the Johan Castberg FPSO from Statoil. The order backlog ended at NOK 11.1 billion, reflecting a 38 per cent increase since year-end 2017. The company's financial position remains strong, with NOK 2.8 billion of cash, in addition to a NOK 2.0 billion undrawn credit facility. Subsequent to first quarter, Kvaerner together with Aker Solutions was awarded a letter of intent with Statoil for the modification of the riser platform and the field center for the Johan Sverdrup development, valued at NOK 3.4 billion. Aker supports Kvaerner's ambition of exploring strategic alternatives and to further develop adjacent segments, enabled by the company's strong balance sheet.

Results and Returns for Industrial Holdings1)

		Aker Solutions		Akastor		Kvaerner
Amounts in NOK million	1Q17	1Q18	1Q17	1Q18	1Q17	1Q18
Revenue	5 173	5 483	943	1 135	1 554	1 913
EBITDA	355	425	53	140	108	193
EBITDA margin (%)	6.9	7.8	5.6	12.3	6.9	10.1
Net profit continued operations	62	105	(189)	(40)	59	119
Closing share price (NOK/share)	51.75	41.45	12.95	15.24	10.80	12.96
Quarterly return (%)3)	25.1	(10.3)	(20.1)	(7.1)	(10.7)	(18.0)

		Aker BP		Ocean Yield		Aker BioMarine
Amounts in USD million	1Q17	1Q18	1Q17	1Q18	1Q17	1Q18
Revenue	646	890	79	89	28	35
EBITDA2)	517	712	71	78	3	3
EBITDA margin (%)	80.1	80.1	90.6	87.2	11.4	9.6
Net profit continued operations	69	161	37	33	(4)	(8)
Closing share price (NOK/share)	137.60	212.20	61.00	66.0	N/A	N/A
Quarterly return (%)3)	(9.9)	6.3	(3.8)	(2.9)	N/A	N/A

1) The figures refer to the results reported by the companies. Reference is made to the respective companies' quarterly reports for further details.

2) For Aker BP, EBITDAX is used.

3) The figures refer to total shareholder return, i.e. share price development and dividend payments.

Aker – Segment information Financial Investments

	As of 31.12.2017		As of 31.03.2018
	NOK/ share1)	NOK million	NOK/ share1)	NOK million
Cash	17	1 232	34	2 495
Liquid fund investments	6	442	5	407
Listed financial investments	16	1 220	15	1 128
Real estate	9	674	9	694
Other financial investments	30	2 261	35	2 579
Total Financial Investments	78	5 829	98	7 304

1) The investment's contribution to Aker's per-share NAV.

Financial Investments comprise Aker's cash, liquid fund investments, listed financial investments, real estate investments and other financial investments. The value of Aker's financial investments amounted to NOK 7.3 billion as of 31 March 2018, up from NOK 5.8 billion as per year-end 2017.

Aker's Cash holding stood at NOK 2.5 billion at the end of the first quarter, up from NOK 1.2 billion as per year-end 2017. The primary cash inflows in the quarter were NOK 1.5 billion in proceeds from the issuance of a new bond loan and NOK 521 million in received dividends. The primary cash outflows were NOK 261 million in loan to Aker BioMarine, NOK 172 million in operating expenses and net interest paid, NOK 150 million in investment in Aker Energy and NOK 96 million in repurchase of AKER11 bonds, including payment for accrued interest.

Aker held NOK 407 million in Liquid fund investments at the end of the first quarter, down from NOK 442 million as per year-end 2017, mainly explained by SEK/NOK currency fluctuations.

The value of Listed financial investments stood at NOK 1.1 billion as of 31 March 2018, compared to NOK 1.2 billion as of 31 December 2017. The value of Aker's investment in Philly Shipyard decreased to NOK 455 million, compared to NOK 492 million in the prior quarter, while the value of Aker's direct and indirect investment in American Shipping Company was NOK 335 million at the end of the first quarter, compared to NOK 345 million as of 31 December 2017. Aker's shares in Solstad Farstad was valued at NOK 316 million as per 31 March 2018. This compares to NOK 353 million at the end of the fourth quarter.

Aker's investments in Real estate increased by NOK 20 million in the quarter to NOK 694 million from NOK 674 million as per year-end 2017. The value of Aker's current real estate holdings mainly reflects ongoing residential projects, as well as the value of land at Fornebu and Aberdeen.

Other financial investments amounted to NOK 2.6 billion at the end of the first quarter, up from NOK 2.3 billion as of 31 December 2017. Other financial investments consist of equity investments, receivables, and other assets. The increase in the quarter is mainly explained by a NOK 261 million drawdown of a loan provided to Aker BioMarine and a NOK 150 million investment in Aker Energy, partly offset by currency fluctuations as certain investments are denominated in USD. The value of Aker's receivables was NOK 1.7 billion at the end of the first quarter, up from NOK 1.5 billion as per year-end 2017.

Aker ASA and holding companies Combined balance sheet

Amounts in NOK million, after dividend allocation	31.12.2017	31.03.2018
Intangible, fixed, and non-interest bearing assets	295	273
Interest-bearing assets	1 503	1 721
Investments1)	19 578	19 559
Non interest-bearing current receivables	127	126
Cash	1 232	2 495
Assets	22 735	24 173
Equity	12 779	13 042
Non interest-bearing debt	1 613	1 632
Interest-bearing debt	8 343	9 500
Equity and liabilities	22 735	24 173
Net interest-bearing receivables (debt)	(5 608)	(5 284)
Equity ratio (%)	56	54

1) Aker ASA and holding companies prepares and presents its accounts in accordance with the Norwegian Accounting Act and generally accepted accounting principles (GAAP), to the extent applicable. Accordingly, exchange-listed shares owned by Aker ASA and holding companies are recorded in the balance sheet at the lower of market value and cost price. In accordance with Aker ASA and holding companies' accounting principles, acquisitions and disposals of companies are a part of the ordinary business. Consequently gains from sales of shares are classified as operating revenues in the combined profit and loss statement of the accounts. Gains and losses are only recognised to the extent assets are sold to third parties. Aker's accounting principles are presented in the company's 2017 annual report.

The total book value of assets was NOK 24.2 billion at the end of the first quarter, up from NOK 22.7 billion at per year-end 2017.

Intangible, fixed and non-interest bearing assets amounted to NOK 273 million as per 31 March 2018, down from NOK 295 million as per year-end 2017.

Interest-bearing assets rose to NOK 1.7 billion at the end of the first quarter from NOK 1.5 billion as per 31 December 2017. The increase is primarily explained by a NOK 261 million drawdown of a loan provided to Aker BioMarine, partly offset by foreign exchange movements as certain receivables are denominated in USD.

Investments stood at NOK 19.6 billion as per 31 March 2018, on par with prior quarter. Aker invested NOK 150 million in Aker Energy during the first quarter. This was offset by write-downs of the book values of Aker's direct investments in Aker Solutions, Akastor and Solstad Farstad.

Non interest-bearing current receivables stood at NOK 126 million at the end of the first quarter, on par with prior quarter.

Aker's Cash stood at NOK 2.5 billion at the end of the first quarter, up from NOK 1.2 billion as per year-end 2017.

Equity increased to NOK 13.0 billion at the end of the first quarter from NOK 12.8 billion three months earlier. The increase in the first quarter is primarily due to Aker posting a profit before tax of NOK 266 million.

Non interest-bearing debt stood at NOK 1.6 billion as per 31 March 2018, on par with prior quarter. This includes NOK 1.3 billion set aside as dividend to Aker shareholders, which was paid out in early May.

Interest-bearing debt increased to NOK 9.5 billion in the first quarter from NOK 8.3 billion in the fourth quarter. The increase is mainly explained by Aker raising NOK 1.5 billion in a new bond loan, partly offset by Aker repurchasing NOK 94 million of AKER11 bonds and currency fluctuations as certain loans are denominated in USD and SEK. As per the end of the first quarter, Aker had NOK 6.8 billion in outstanding bond loans and NOK 2.7 billion in bank loans, net of capitalized loan fees.

Aker ASA and holding companies Combined income statement

				Year
Amounts in NOK million	1Q 17	4Q 17	1Q 18	2017
Operating expenses	(63)	(76)	(68)	(244)
EBITDA	(63)	(76)	(68)	(244)
Depreciation	(4)	(4)	(4)	(14)
Value change	134	7	(179)	(289)
Net other financial items	444	365	516	1 380
Profit/(loss) before tax	511	294	266	833

Aker ASA and holding companies prepares and presents its accounts in accordance with the Norwegian Accounting Act and generally accepted accounting principles (GAAP), to the extent applicable. Accordingly, exchange-listed shares owned by Aker ASA and holding companies are recorded in the balance sheet at the lower of market value and cost price. In accordance with Aker ASA and holding companies' accounting principles, acquisitions and disposals of companies are a part of the ordinary business. Consequently gains from sales of shares are classified as operating revenues in the combined profit and loss statement of the accounts. Gains and losses are only recognised to the extent assets are sold to third parties. Aker's accounting principles are presented in the company's 2017 annual report.

The income statement for Aker ASA and holding companies shows a profit before tax of NOK 266 million for the first quarter 2018. This compares to a profit before tax of NOK 294 million in the fourth quarter. As in previous periods, the income statement is mainly affected by value changes in share investments and dividends received.

Operating expenses in the first quarter were NOK 68 million compared to NOK 76 million in the prior quarter.

Value change in the first quarter was negative NOK 179 million mainly reflecting the value decrease of Aker's direct holding in Aker Solutions, Akastor and Solstad Farstad. The value change in the quarter compares to a positive value change of NOK 7 million in the fourth quarter.

Net other financial items in the first quarter amounted to NOK 516 million, compared to NOK 365 million in the fourth quarter. The increase in the quarter is mainly explained by higher amount of dividends received and net gains on foreign exchange contracts. Net other financial items are primarily impacted by dividends received, net interest expenses and by mark-to-market adjustments on foreign exchange positions and Aker's total return swaps related to American Shipping Company. Aker received NOK 521 million in dividends in the first quarter, compared to NOK 408 million in the prior quarter.

The Aker Share

The company's share price increased to NOK 440.5 at the end of the first quarter 2018 from NOK 403 three months earlier. The company had a market capitalisation of NOK 32.7 billion as per 31 March 2018.

As per 31 March 2018, the total number of shares in Aker amounted to 74 321 862 and the number of outstanding shares was 74 306 129. As per the same date, Aker held 15 733 own shares.

Risks

Aker ASA and each portfolio company are exposed to various forms of market, operational and financial risks. Rather than diversifying risk by spreading investments across many different industries, Aker is focused on sectors in which the company possesses longstanding expertise. The company has established a model for risk management based upon identifying, assessing and monitoring major financial, strategic and operational risks in each business segment, drawing up contingency plans for those risks and closely monitoring the consolidated risk picture. The identified risks and how they are managed are reported to the Aker Board on a regular basis. Aker continuously works to improve its risk management process.

The main risks that Aker ASA and holding companies are exposed to are related to the value changes of the listed assets due to market price fluctuations. The development of the global economy, and energy prices in particular, as well as currency fluctuations, are important variables in predicting near-term market fluctuations. Aker ASA and holding companies are also exposed to risk of insufficient access to external financing. The company seeks to mitigate this risk by maintaining a solid liquidity buffer and by proactively planning for refinancing activities.

The companies in Aker's portfolio are, like Aker, exposed to commercial risks, financial risks and market risks. In addition these companies, through their business activities within their respective sectors, are also exposed to legal/regulatory risks and political risks, i.e. political decisions on petroleum taxes, environmental regulations and operational risks, including major accidents which may have significant financial impact.

Despite an increase over the last two years, crude oil prices are still lower than observed in the period from 2011 to 2014 and volatility is high. This has impacted revenues for both oil and gas and oil services companies, which in turn may adversely affect the financial strength of some of Aker's portfolio companies' counterparties.

Aker's risk management, risks and uncertainties are described in the Annual Report for 2017.

Key events after the balance sheet date

After the close of the first quarter 2018, the following events occurred that affect Aker and the company's investments:

• n On 5 April, Aker Solutions and Kvaerner announced that the companies had secured a letter of intent for modification of the riser platform and the field center for the Johan Sverdrup development Phase II. The contract value is NOK 3.4 billion and will be split equally between the companies.
• n On 16 April, Aker announced that its wholly owned subsidiary Aker Capital AS had entered into an agreement with Geveran Trading Co. Ltd and Joh Johannson Eiendom AS to establish a residential real estate development company, FP Bolig Holding AS ("FP Bolig"). Under the agreement, FP Bolig will acquire three real estate land areas at Fornebu from Aker. Aker will own 37.55 per cent of FP Bolig. The transaction is expected to release approximately NOK 360 million in cash for Aker, and will realize an accounting gain of approximately NOK 190 million to be booked in the second quarter of 2018.
• n On 19 April, Akastor announced a potential USD 75 million investment in perpetual preferred equity in Odfjell Drilling Ltd as part financing for the potential acquisition of the semisubmersible drilling rig Stena Midmax.
• n On 20 April, Aker's Annual General Meeting approved the distribution of NOK 18 per-share ordinary cash dividend for 2017. In total, NOK 1.3 billion was paid out in early May.

Outlook

Investments in listed shares comprised 85 per cent of the company's assets as per 31 March 2018. About 72 per cent of Aker's investments was associated with the oil and gas sector, 13 per cent with the maritime industry, seafood and marine biotechnology 6 per cent, cash and liquid fund investments represented 6 per cent, and other assets 4 per cent. Aker's NAV will thus be influenced by fluctuations in commodity prices, exchange rates and developments on the Oslo Stock Exchange, as well as operational performance.

The cutbacks in E&P spending, driven by oil and gas companies' focus on free cash flow amid lower crude prices, have put the oil service industry under pressure. The reduction in spending seen over the last three years has led to a decline in activity and fewer projects have been sanctioned globally. At the same time, costcutting measures and increased operational efficiency across the industry have brought down break-even costs for offshore projects. In addition, the oil market is gradually balancing and oil prices have increased along with continued demand growth. Aker expects that this will lead to more projects being sanctioned and that spending will increase in the short to medium term. Nevertheless, Aker expects the overall activity level to remain subdued as E&P companies continue to take a cautious approach to new investments. Therefore, Aker's portfolio companies in the oil and gas sector will continue to increase competitiveness through increased productivity, efficiency and standardisation, improved technology offerings, and by exploring strategic partnerships and alliances. Longer term, Aker remains positive about the outlook for oil and gas and will therefore continue to evaluate strategic alternatives and opportunities in the sector.

Aker's strong balance sheet and liquidity reserves enable the company to face unforeseen operational challenges and short-term market fluctuations, as well as to seize value-accretive investment opportunities. As an industrial investment company, Aker will use its resources and competence to promote and support the development of the companies in its portfolio, and to consider new investments.

Fornebu, 8 May 2018 Board of Directors and President and CEO

Aker ASA: Net Asset Value

Reported values in NOK million	Number of shares per 31.03.18	Ownership capital per 31.03.18	Share of total assets per 31.03.18	Reported values per 31.03.18	Reported values per 31.12.17
Industrial Holdings
Aker BP	144 049 005	40.0%	58.5%	30 567	29 083
Aker Solutions	94 565 2931)	34.8%1)	7.5%	3 920	4 368
Akastor	100 565 2931)	36.7%1)	2.9%	1 533	1 649
Kvaerner	77 233 5311)	28.7%1)	1.9%	1 001	1 220
Ocean Yield	98 242 575	61.7%	12.4%	6 484	6 828
Aker BioMarine		100.0%	2.7%	1 411	1 411
Total Industrial Holdings			86.0%	44 916	44 560
Financial Investments Cash			4.8%	2 495	1 232
Liquid fund investments			0.8%	407	442
Real estate			1.3%	694	674
Listed financial investments			2.2%	1 128	1 220
American Shipping Company (incl. TRS)2)	11 557 022	19.1 / 49.9%	0.6%	335	345
Philly Shipyard	7 237 631	57.6%	0.9%	455	492
Solstad Farstad	58 496 302	20.1%	0.6%	316	353
Cxense	512 849	5.7%	0.0%	23	30
Receivables			3.3%	1 701	1 503
Aker BioMarine			2.0%	1 037	823
Ocean Harvest Invest			0.7%	364	404
American Shipping Company			0.1%	52	55
Other			0.5%	248	220
Other financial investments			1.7%	879	758
Total Financial Investments			14.0%	7 304	5 829
Gross Asset Value			100.0%	52 220	50 389
Interest-bearing liabilities				(9 500)	(8 343)
Other liabilities				(295)	(275)
Net Asset Value (before allocated dividend)				42 425	41 771
Number of outstanding shares				74 306 129	74 295 513
Net Asset Value per share (before allocated dividend)				571	562

1) Partly owned through Aker Kvaerner Holding AS, in which Aker ASA has a 70 per cent ownership interest. Additionally, Aker ASA has direct ownership interest in Aker Solutions ASA and Akastor ASA

2) Aker ASA holds direct exposure to 11 557 022 shares in American Shipping Company ASA, equivalent to 19.07% of the shares and votes of the company, and financial exposure to 18 687 620 underlying shares through two total return swap agreements, equivalent to 30.83% of the share capital in the company

Aker ASA: Net Asset Value contribution YTD 2018

NOK billion

Financial calendar 2018

18 July 1H 2018 report 9 November 3Q 2018 report

For more information:

Per Kristian Reppe

Investment Manager & Head of Investor Relations Tel: +47 24 13 00 67 E-mail: per.reppe@akerasa.com

Atle Kigen Head of Corporate Communication Tel: +47 24 13 00 08 E-mail: atle.kigen@akerasa.com

Address:

Oksenøyveien 10, NO-1366 Lysaker, Norway Phone: +47 24 13 00 00 www.akerasa.com

Ticker codes:

AKER NO in Bloomberg AKER.OL in Reuters

This report was released for publication at 07:00 CEST on 9 May 2018. The report and additional information is available on www.akerasa.com

Alternative Performance Measures

Aker ASA refers to alternative performance measures with regards to Aker ASA and holding companies' financial results and those of its portfolio companies, as a supplement to the financial statements prepared in accordance with IFRS. Such performance measures are frequently used by securities analysts, investors and other interested parties, and they are meant to provide an enhanced insight into operations, financing and future prospects of the group. The definitions of these measures are as follows:

• n EBITDA is operating profit before depreciation, amortisation and impairment charges.
• n EBITDA margin is EBITDA divided by revenue.
• n EBITDAX is operating profit before depreciation, amortisation, impairment charges and exploration expenses.
• n Equity ratio is total equity divided by total assets.
• n Gross asset value is the sum of all assets, determined by applying the market value of exchange-listed shares, while book value is used for other assets.
• n Kboed is thousand barrels of oil equivalents per day.
• n Net Asset Value ("NAV") is gross asset value less liabilities.
• n NAV per share is NAV divided by the total number of outstanding Aker ASA shares.
• n Net interest-bearing receivable/debt is cash, cash equivalents and interest-bearing receivables (current and non-current), minus interestbearing debt (current and non-current).
• n Order intake includes new signed contracts in the period, in addition to expansion of existing contracts. The estimated value of potential options and change orders is not included.
• n Order backlog represents the estimated value of remaining work on signed contracts.
• n Value-adjusted equity ratio is NAV divided by gross asset value.