Aker — Interim / Quarterly Report 2020

May 8, 2020

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Q1 2020

Aker ASA First-quarter results 2020

8 May 2020

Highlights

• Net asset value: Decreased by 52 per cent to NOK 24.1 billion. Per-share NAV amounted to NOK 325.
• Return: Aker share price decreased 57 per cent, to NOK 235.60 vs. OSEBX down 24 per cent and the Brent price down 65.5 per cent.
• Liquidity reserve: NOK 6.1 billion, cash amounted to NOK 4.4 billion.
• Dividend: Board recommended amending previously proposed dividend.
• Portfolio: Systematic efforts initiated to respond to COVID-19 pandemic and collapse in global oil demand and activity, incl. reductions in cost and capex.
• Aker BP: Successfully raised USD 1.5 billion in senior notes with favorable pricing. The company has placed non-sanctioned field development projects on hold and has reduced exploration spending and production costs.
• Aker BP: Subsequent to the quarter, the Norwegian government has communicated voluntary production cuts to help the global oil market balance. These cuts will not materially affect Aker BP's production in 2020.
• Norwegian petroleum tax changes: Subsequent to the quarter, the Norwegian government has proposed some temporary changes in the petroleum tax rules in order to incentivize oil producers to invest in new projects.
• Philly Shipyard: Announced the contract award for the construction of two National Security Multi-Mission Vessels, including options for three more. Total contract value of approximately USD 1.5 billion.

Aker ASA and holding companies Net asset value down 52% in the quarter to NOK 24.1 billion

Net asset value change in Q1 2020 NOK billion

Aker ASA and holding companies Share price down 57%, continued strong cash holding

NAV per share vs. share price NOK per share

Net asset value composition

NOK billion, per 1Q 2020

Aker ASA and holding companies Portfolio composition

Portfolio composition NOK billion, per 1Q 2020 Industrial Holdings Financial Investments 0.7 Aker BP 40.0% 19.1 Kvaerner 0.5 1) 28.7% 4.4 Cash Aker Solutions 0.5 1)) 34.8% Akastor 0.4 1)) 36.7% 0.7 Listed financial investments Real Estate Investments2)

Aker BioMarine 4.9 2) 98.0%

Aker Energy 1.0 2)

Cognite <0.1 2)

Ocean Yield 61.7% 2.5

Gross asset value 29.0 8.7

50.8%

64.0%

Net asset value 24.1

Gross asset value distribution Per 1Q 2020 (4Q 2019)

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

Listed investments

Listed Industrial Holdings

Aker's portfolio of listed Industrial Holdings

- Share of Aker's GAV in circle colour – return in the quarter (incl. received dividend) inside the circle - and key highlights

• Successful issuance of USD 1.5 billion notes, at a very attractive price
• Updated investment program and financial framework to secure additional financial optionality
• Non-sanctioned field development projects placed on hold and exploration spending reduced by 20%

• Maintains guiding for 205-220 kbd production in 2020

• Significant reduction in activity. Focus on protecting balance sheet and financial performance

• Organization restructuring with cost and capex reductions
• Won the following contracts:
• Maintenance and modification contract for more than 200 assets to Brunei Shell Petroleum

• 20-year agreement with Chevron for subsea umbilicals in the US Gulf of Mexico

• Evaluating opportunities for Dhirubhai-1

• Acquired two ultamaxes and one kamsarmax dry bulk vessels
• Declared USD 5 cents per share in dividends for the quarter

• Future dividend policy to take into consideration COVID-19 effects on counter parts.

• Operations negatively impacted by COVID-19

• Cost reductions, including demobilisation of hired-in personnel
• New prospects in 2020 is expected to come within renewables and processrelated industries
• MHWirth seeing an improving aftermarket while newbuilding market continues to be muted
• Cost-base being adjusted to account for uncertainty related to COVID-19
• Two AKOFS vessels in Brazil delivered revenue utilization of 99% in the quarter
• Skandi Santos contract extended to end November 2020

Non-listed Industrial Holdings

Aker's portfolio of non-listed Industrial Holdings

– These companies are at book value in Aker's accounts – key highlights shown below

Exploration & Production company in Ghana

• Project put on hold due to COVID-19, in line with postponements in the general global O&G industry
• Organization reduced to small core team
• Håvard Garseth named new CEO
• Continuing efforts to optimize field development in light of new market situation

Industrial software and digitalisation company

• Revenue growth supported by fast-growing customer base
• Secured new commercial engagements with several of the world's largest O&G companies and has solid pipeline of potential customers
• Organization continues to grow with 29 new employees hired during the quarter

Integrated biotech company – specialised in krill harvesting and processing

• Positive development in the quarter mainly due to higher sales, increased margins and full inclusion of Lang acquired in Q1 2019.
• Undertaken significant investments to create operational leverage
• Revenues expected to grow by further developing existing segments, as well as growing new verticals
• COVID-19 has had limited impact but company is cutting opex and postponed projects to preserve cash

Aker Financial Investments

Financial Investments Overview

% of gross asset value (31.03.2020)

NOK billion

• Other financial investments
• Real estate
• Listed financial investments
• Cash

Financial Investments Cash

% of gross asset value (31.03.2020)

• Cash up NOK 673 million in the quarter to NOK 4.4 billion:
• • NOK 1006 million in dividend received in cash
• NOK 253 million in net increased receivables from portfolio companies
• NOK 202 million in operating expenses and net interest
• • NOK 123 million in net other cash movements and f/x adjustments
• Total liquidity reserve of NOK 6.1 billion, including undrawn credit facilities.

Financial Investments Listed financial investments

% of gross asset value (31.03.2020)

• Value decrease of AMSC of NOK 157 million in the quarter. In addition, negative value development of AMSC TRS agreements of NOK 251 million. Dividend income from AMSC of NOK 23 million (shares and TRS).
• Value of investments in Philly Shipyard and REC Silicon fairly stable in an otherwise turbulent quarter.
• Subsequent to the quarter, Philly Shipyard announced the contract award for the construction of two National Security Multi-Mission Vessels and retains options for three more. If all ships are ordered and built the total contract value would be approx. USD 1.5 billion.

Aker's investment

NOK million	3Q 19	4Q 19	1Q 20
Philly Shipyard	280	309	304
AMSC (excl. TRS)	383	380	223
Solstad Offshore	41	57	30
REC Silicon	-	172	183
Other	20	-	-
Total value	723	917	739
AMSC TRS*	(28)	(41)	(292)
*) Included in interest-free liabilities.

Financial Investments

Real estate and other financial investments

% of gross asset value (31.03.2020)

• Other financial investments mainly consist of receivables against Aker BioMarine and Estremar Invest, airplanes, and unlisted share investments.
• Receivables against Aker BioMarine and Estremar increased both due to increased loan to Aker BioMarine of NOK 142 million, and due to f/x adjustments.
• Loan issued to FP Eiendom increased by NOK 100 million.

Aker's investment

NOK million	3Q 19	4Q 19	1Q 20
Real estate	568	603	703
Other financial investments	2 437	2 498	2 871
Total value	3 005	3 101	3 574

Aker Financial Statements

Aker ASA and holding companies Balance sheet at 31.03.2020

Main changes in first-quarter 2020

• Cash holdings increased to NOK 4.4 billion.
• Book value of investments decreased by NOK 645 million, mainly due to write-downs related to indirect and direct investments in Aker Solutions, Akastor and Kvaerner of NOK 2.7 billion in total. Other investments was written down below cost with a total of NOK 0.5 billion. These value reductions were partly offset by a reversal of previous impairments for Aker BioMarine of NOK 2.6 billion.
• Decrease in fair value adjustment of NOK 25 billion, mainly explained by value decreases of the Aker BP and Ocean Yield investments.
• Liabilities increased to NOK 13.5 billion due to foreign exchange adjustments.

	Book value	Value-adjusted
Equity (MNOK)	13 651	24 135
Equity ratio	50.2%	64%
Equity per share	NOK 184	NOK 325

Aker ASA and holding companies Interest-bearing items as of 31.03.2020

Interest-bearing receivables Interest-bearing debt

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

Financial Covenants	Limit	Status at 31.03.2020
i Total Debt/Equity - Aker ASA (parent only)	< 80%	48%
ii Group Loans to NAV or Group Loans	< 50% < NOK 10 bn	6.0% NOK 1.4 bn

Aker ASA and holding companies Income statement

Amounts in NOK million	1Q 2019	4Q 2019	1Q 2020	Year 2019
Sales gains	-	-	-	-
Operating expenses	(66)	(64)	(62)	(267)
EBITDA	(66)	(64)	(62)	(267)
Depreciation and impairment	(5)	(8)	(9)	(25)
Value change	51	(63)	(677)	(435)
Net other financial items	797	847	(299)	2 886
Profit before tax	777	711	(1 046)	2 159

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.