Aker — Interim / Quarterly Report 2018

May 9, 2018

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Aker ASA First-quarter results 2018

9 May 2018 | Fornebu

Highlights | First quarter 2018

• Net asset value: up 1.6% to NOK 42.4 billion (NOK 41.8 billion)
• Return: Aker share up 9.3% to NOK 440.5 vs. OSEBX down 1.1%
• Cash and liquid fund inv.: NOK 2.9 billion, up from NOK 1.7 billion per year-end 2017. Liquidity reserve of NOK 5.2 billion when including undrawn credit facilities
• Dividend: NOK 18 per share cash dividend distributed in May
• Aker events:
• i. Aker Energy: Agreement to acquire Hess Ghana by Aker Energy (50-50 JV between Aker and TRG)
• ii. Norske Skog: Termination of agreement with Oceanwood
• iii. Financing: Placement of a new NOK 1.5 billion unsecured bond
• Portfolio events:
• i. Aker Solutions: Placement of a new NOK 1.5 billion unsecured bond
• ii. Aker BP: Dividends in 2018 raised to USD 450 million and issuance of USD 500 million senior notes
• iii. Ocean Yield: New investments, raised NOK 759 million in new equity
• Subsequent events:
• i. Aker: Establishes property development company with Geveran and Joh Johannson Eiendom
• ii. Akastor: USD 75 million investment in perpetual preferred equity in Odfjell Drilling Ltd.

Aker ASA and holding companies

Aker's NAV up 1.6% in first quarter attributed to Aker BP value increase

Net asset value change in 1Q 2018 NOK billion

Aker ASA and holding companies Continued positive value development and a strong balance sheet

NAV per share vs. share price NOK per share

Net asset value composition NOK billion

NAV per share

Share price (adjusted for dividends paid)

1) Based on closing prices of Aker's listed holdings as per 8 May 2018, remaining assets and liabilities at reported book values per 31.03.18. Excluding cash movements in the second quarter

Aker ASA and holding companies

Portfolio distribution largely unchanged

Portfolio composition NOK billion, as per 1Q 2018

					Listed investments Unlisted investments
Industrial Holdings					Financial Investments
Aker BP	40.0%	30.6	2.5	Cash
1)) Aker Solutions	34.8%	3.9	0.4	Liquid fund investments
1)) Akastor	36.7%	1.5	1.1	Listed financial investments
1) Kvaerner	28.7%	1.0	0.7	Real Estate Investments2)
Ocean Yield	61.7%	6.5	2.6		Other financial investments2)
2) Aker BioMarine	100.0%	1.4
Gross asset value		44.9	7.3
Net asset value			42.4

Gross asset value distribution Per 1Q 2018 (4Q 2017)

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

Aker ASA and holding companies

Strong investment capacity and increased upstream cash

Investment capacity potential NOK billion

Upstream dividend NOK billion

Industrial Holdings Aker BP

Exploration & Production company on the Norwegian continental shelf

% of gross asset value

(1Q 2018)

Investment value of NOK 30.6 billion

Aker's ownership agenda

• Growth; organic (greenfield projects, IOR and exploration) and through M&A
• Dividend growth
• Operational excellence and efficiency improvements through new business models and technologies, including digitalisation

Aker's investment

	29 083
	1 838
	(354)
Value as per 31.03.18 30 567
1Q 17	1Q 18
646	890
517	712

Industrial Holdings Aker Solutions

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

% of gross asset value

(1Q 2018)

Investment value of NOK 3.9 billion

Aker's ownership agenda

• Increase competitiveness, reach cost-efficiency target of 50 per cent by 2021
• Win new contracts
• Partnerships, alliances and M&A

Aker's investment

4 368
(448)
3 920

NOK million	1Q 17	1Q 18
Revenues	5 173	5 483
EBITDA	355	425
Backlog	30 709	37 553

Industrial Holdings

Akastor

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

% of gross asset value

(1Q 2018)

Investment value of NOK 1.5 billion

Aker's ownership agenda

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

Aker's investment

NOK million
Value as per 31.12.17	1 649
Value change in 1Q	(117)
Value as per 31.03.18	1 533

NOK million	1Q 17	1Q 18
Revenues	943	1 135
EBITDA	53	140
Backlog	7 295	6 462

Industrial Holdings Kvaerner

Oil and gas-related EPC company

% of gross asset value

(1Q 2018)

Investment value of NOK 1.0 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 31.12.17 1 220 Value change in 1Q (219) Value as per 31.03.18 1 001

NOK million	1Q 17	1Q 18
Revenues	1 554	1 913
EBITDA	108	193
Backlog	10 841	11 118

Industrial Holdings Ocean Yield

A maritime assets company with focus on long-term contracts

% of gross asset value

(1Q 2018)

Investment value of NOK 6.5 billion

Aker's ownership agenda

• Growth by new investments and M&A
• 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 31.12.17		6 828
Value change in 1Q		(196)
Received dividends		(148)
Value as per 31.03.18		6 484
Key figures
USD million	1Q 17	1Q 18
Revenues	79	89
EBITDA	71	78
EBITDA backlog	2 800	3 500

Industrial Holdings Aker BioMarine

Integrated biotech company – specialised in krill harvesting and processing

% of gross asset value

(1Q 2018)

Investment value of NOK 1.4 billion

Aker's ownership agenda

• Operational excellence and improve profitability
• Increase sales by entering new products, channels and geographies
• Extract synergies from recent transactions
• New vessel and other investments to fast-track growth

Aker's investment

NOK million
Value as per 31.12.17 (book value)	1 411
Value change in 1Q	-
Value as per 31.03.18 (book value)	1 411

USD million	1Q 17	1Q 18
Revenues	28	35
EBITDA	3	3

Aker Energy and Cognite remain core to Aker's value agenda

	Key developments
	▪ Agreement to acquire Hess Ghana from Hess Corporation for USD 100 million, of which USD 75 million million payable on approval of PDO payable on approval of PDO
	▪ Jan Arve Haugan appointed CEO, management in place
E&P company in Ghana	▪ Board recruited and governance model established
(50% owned by Aker)	▪ Organization scaled to ~80 skilled employees Aker Energy team scaled to ~80 FTEs
	▪ Ongoing work to prepare for submission of PDO in H2, and verify resource base through drilling program

	Key developments
Digitalization company	▪ Signed Aker Solutions as customer in the first quarter ▪ Further progress made with Aker BP as core customer in effort to digitalize company ▪ In process of expanding portfolio of external clients ▪ Recruiting new talents, organization now ~75 employees
(68% owned by Aker)

Aker has delivered excess returns, both short- and long-term

Long-term return: NAV per share NOK per share

Short-term returns: Share price YTD NOK per share, dividend adjusted

1) Based on closing prices of Aker's listed holdings as per 8 May 2018, remaining assets and liabilities at reported book values per 31.03.18. Excluding cash movements in the second quarter

Aker Financial Investments

Financial Investments Overview

% of gross asset value (31.03.2018)

NOK billion

• Other financial investments
• Listed financial investments
• Liquid fund investments

Financial Investments

Cash and Liquid fund investments

% of gross asset value

(31.03.2018)

• Cash increased to NOK 2.5 billion:
• • NOK 521 million in dividends received
• • NOK 1 489 million from new bond issue (net)
• NOK 261 million loan issued to Aker BioMarine
• NOK 150 million in investment in Aker Energy
• NOK 172 million in operating expenses and net interest paid
• NOK 96 repurchase of own bonds (AKER11)
• NOK 68 million in net other cash movements
• Liquid fund investments at NOK 407 million.
• Total liquidity reserve of NOK 5.2 billion, including undrawn credit facilities.

Financial Investments Listed financial investments

% of gross asset value (31.03.2018)

• Value decrease of Philly Shipyard with NOK 38 million and Solstad Farstad by NOK 37 million.
• Dividend received from AMSC of NOK 19 million. Total AMCS exposure decreased by NOK 10 million.
• Philly Shipyard faces order backlog challenges.

Source: Solstad Farstad

Aker's investment

NOK million	3Q 17	4Q 17	1Q 18
Philly Shipyard	644	492	455
AMSC (incl. TRS)	270	345	335
Cxense	21	30	23
Solstad Farstad	403	353	316
Total value	1 338	1 220	1 128

Financial Investments

Real estate and other financial investments

% of gross asset value (31.03.2018)

• Increased loans to Aker BioMarine and Fornebuporten equal to NOK 281 million.
• Total loan to Aker BioMarine at the end of 1Q was NOK 1 037 million. Almost the entire loan will be converted to equity during 2Q.

Aker's investment

NOK million	3Q 17	4Q 17	1Q 18
Real estate	629	674	694
Other financial investments	2 058	2 261	2 579
Total value	2 687	2 934	3 273

Financial Investments

Fornebuporten – recent events and current portfolio

• Q1 2018: established a 50/50 JV with OBOS for residential development at Fornebuporten.
• April 2018: established residential development company FP Bolig together with Geveran Trading and Joh Johannson Eiendom.
• Akers ownership of FP Bolig is 37.55%.
• FP Bolig's portfolio consists of land bank for approximately 1 000 apartments.
• Aker participated through sale of the Koksa II land plot and the 50% share of the OBOS JV.
• Accounting gain for Aker of approx. NOK 190 million and a cash release of approx. NOK 360 million.
• In addition, the real estate portfolio includes:
• Commercial properties and land areas at Fornebu and in Aberdeen.
• Portfolio of residential projects close to completion.

*FP OBOS JV owned 50% by FP Bolig

Aker Financial Statements

Aker ASA and holding companies

Balance sheet at 31.03.2018

(after dividend allocation of NOK 18 per share)

Aker ASA and holding companies Interest-bearing items as of 31.03.2018

Average debt maturity is 2.6 years For details of interest-bearing items and loan guarantees, see: https://www.akerasa.com/Investor/Treasury

Financial Covenants	Limit	Status at 31.03.2018
i Total Debt/Equity - Aker ASA (parent only)	< 80%	38%
ii Group Loans to NAV or Group Loans	< 50% < NOK 10 bn	3.2% NOK 1.4 bn

Aker ASA and holding companies Income statement

Amounts in NOK million	1Q 2017	4Q 2017	1Q 2018	Year 2017
Sales gains	-	-	-	-
Operating expenses	(63)	(76)	(68)	(244)
EBITDA	(63)	(76)	(68)	(244)
Depreciation and impairment	(4)	(4)	(4)	(14)
Value change	134	7	(179)	(289)
Net other financial items	444	365	516	1 380
Profit before tax	511	294	266	833

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.