Aker — Investor Presentation 2019

Feb 14, 2019

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Aker ASA Fourth-quarter and preliminary annual results 2018

14 February 2019 | Fornebu

14 February 2019 AKER ASA | Fourth-quarter and preliminary annual results 2018 2

Highlights

Highlights 2018:

• Return: Share price up 19.1%, dividend adjusted, compared to the OSEBX which was down 1.8%
• Net asset value: NOK 41.7 billion, on par with year-end 2017
• Liquidity reserve: NOK 5.2 billion. NOK 2.2 billion in upstream cash received
• Dividend: NOK 22.50 per share cash dividend proposed (4.9% yield and 4.0% of NAV)

Fourth quarter:

• Return: Share price decreased 37.1% to NOK 462 vs. OSEBX down 14.8%.
• Net asset value: Down 34.0% to NOK 562 per share

Main events in the quarter:

• Aker BP: Acquisition of King Lear for USD 250 million from Equinor and USD 1.5 billion tax refund
• Ocean Yield: Investment in two chemical tankers for USD 51 million

Subsequent events:

• Aker BP: Dividends in 2019 raised to USD 750 million, with annual step-ups
• Aker Energy: Successful drilling operations of Pecan-4A appraisal well
• Kværner: NOK 1 per share dividend proposed

Aker ASA and holding companies

Flat NAV development in 2018, despite significant value decrease in fourth quarter

Net asset value change in 2018 NOK billion

Aker ASA and holding companies

Share price up 19.1%, dividend adjusted, in 2018

NAV per share vs. share price NOK per share

Net asset value composition NOK billion, per 4Q 2018

1) Based on closing prices of Aker's listed holdings as per 13 February 2019, remaining assets and liabilities at reported book values per 31.12.18. Excluding cash movements in the first quarter

Aker ASA and holding companies Portfolio composition unchanged

Portfolio composition NOK billion, per 4Q 2018

				Listed investments Unlisted investments
Industrial Holdings				Financial Investments
Aker BP	40.0%	31.4	1.9	Cash
1)) Aker Solutions	34.8%	3.8	0.7	Listed financial investments
Akastor 1))	36.7%	1.3	0.6	Real Estate Investments2)
1) Kvaerner	28.7%	0.9	2.4	Other financial investments2)
Ocean Yield	61.7%	5.8
2) Aker BioMarine	100.0%	2.4
Gross asset value		45.6	5.6
Net asset value			41.7

Gross asset value distribution Per 4Q 2018 (3Q 2018)

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

Record high upstream cash in 2018, expected to grow in 2019

Additional potential sources 3.2 Cash Undrawn credit facilities per end-Q4 1.9 2011 2012 2013 2014 2015 2016 2017 2018 2019E Havfisk Kvaerner Aker Solutions/Akastor Aker BioMarine Financial Investments Aker BP Ocean Yield Investment capacity potential NOK billion Increased gearing Increased dividends Divestments 1.4 1.0 0.9 0.5 0.2 1.4 Upstream dividend NOK billion 1.6 2.2

NOK 22.50 per share in cash dividend proposed (4.0% of NAV)

1)As per end of preceding year

Industrial Holdings

Aker BP

Exploration & Production company on the Norwegian continental shelf

% of gross asset value

(4Q 2018)

Aker's ownership agenda

• Organic and structural growth
• Dividend growth
• Operational excellence and efficiency improvements through new business models and technologies, including digitalisation

Aker's investment

NOK million
Value as per 30.09.18	49 755
Value change in 4Q	(17 973)
Received dividends	(378)
Value as per 31.12.18	31 403

USD million	4Q 17	4Q 18	FY 17	FY 18
Revenues	726	886	2 563	3 750
EBITDAX	565	692	2 012	3 044

Industrial Holdings Aker Solutions

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

% of gross asset value

(4Q 2018)

Investment value of NOK 3.8 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

NOK million
Value as per 30.09.18	5 475
Value change in 4Q	(1 725)
Value as per 31.12.18	3 750

NOK million	4Q 17	4Q 18	FY 17	FY 18
Revenues	6 444	6 954	22 461	25 232
EBITDA	458	483	1 519	1 810
Backlog			34 581	35 148

Industrial Holdings

Akastor

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

% of gross asset value

(4Q 2018)

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 30.09.18 1 778 Value change in 4Q (465) Value as per 31.12.18 1 313

NOK million	4Q 17	4Q 18	FY 17	FY 18
Revenues	895	1 090	3 606	3 800
EBITDA	96	63	116	290
Backlog			1 948	2 692

Industrial Holdings

Kvaerner

Oil and gas-related EPC company

% of gross asset value

(4Q 2018)

Investment value of NOK 0.9 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 30.09.18 1 163 Value change in 4Q (232) Value as per 31.12.18 931

NOK million	4Q 17	4Q 18	FY 17	FY 18
Revenues	1 797	1 715	6 536	7 220
EBITDA	227	77	799	437
Backlog			8 077	10 625

Industrial Holdings Ocean Yield

A maritime assets company with focus on long-term contracts

% of gross asset value

(4Q 2018)

Investment value of NOK 5.8 billion

Aker's ownership agenda

• Growth and diversification through transactions
• Manage and mitigate counterparty risk
• Re-contract FPSO Dhirubhai
• Optimise capital structure, reduce cost of capital and maintain attractive dividend

Aker's investment

NOK million
Value as per 30.09.18
Value change in 4Q
Received dividends
Value as per 31.12.18
Key figures
USD million	4Q 17	4Q 18	FY 17	FY 18
Revenues	89	64	339	343
EBITDA	80	36	306	283
EBITDA backlog			3 000	3 600

Industrial Holdings Aker BioMarine

Integrated biotech company – specialised in krill harvesting and processing

% of gross asset value

(4Q 2018)

Aker's ownership agenda

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

Aker's investment

NOK million
Value as per 30.09.18 (book value)	2 411
Value change in 4Q	-
Value as per 31.12.18 (book value)	2 411

USD million	4Q 17	4Q 18	FY 17	FY 18
Revenues	34	36	126	155
EBITDA	1	2	17	33

Aker ASA and holding companies

Aker Energy

Exploration & Production company in Ghana

% of gross asset value

(4Q 2018)

Highlights and outlook:

• Successful drilling of Pecan-4A appraisal well
• Received permit to drill two additional appraisal wells
• Continued work on maturing field development concept
• Preparing to file Plan of Development by end of March
• Plan for IPO or other transaction

Aker ASA and holding companies

Cognite

Software & digitalisation company

% of gross asset value

(4Q 2018)

Book value < NOK 0.1 billion

Highlights and outlook:

• Signed DEA and Statnett as new customers
• Organization continues to grow, now over 150 employees
• Expectation of significant revenue growth in 2019 with continued positive EBITDA margins
• International expansion
• Long-term plan for IPO

Aker ASA and holding companies World Ocean Headquarter (WOH)

• Initiative announced October 2018 by Aker and REV Ocean
• Global center of competency for ocean and environment related issues, solutions and activities
• Political majority in Bærum municipality turning down the building project
• Aker to explore alternative ways to realize WOH

Aker Financial Investments

Financial Investments Overview

% of gross asset value (31.12.2018)

NOK billion

Financial Investments Cash

% of gross asset value (31.12.2018)

• Cash up NOK 712 million in the quarter to NOK 1.9 billion:
• • NOK 552 million in dividends received
• • NOK 291 million in cash release on AMSC TRS
• • NOK 175 million from liquid fund investments
• NOK 167 million in investment in Aker Energy
• NOK 165 million in operating expenses and net interest
• • NOK 26 million in net other cash movements
• Total liquidity reserve of NOK 5.2 billion, including undrawn credit facilities.

Financial Investments Listed financial investments

% of gross asset value (31.12.2018)

• Value decrease of Solstad Offshore and Philly Shipyard with NOK 186 million and NOK 123 million, respectively.
• The value of the share investment in AMSC was up NOK 27 million.
• The AMSC TRS were rolled forward in November, with a cash release of NOK 291 million. At 31.12.18, the new TRS had a negative value of NOK 32 million.
• Dividend received from AMSC of NOK 21 million (shares and TRS).

Aker's investment

NOK million	4Q 17	3Q 18	4Q 18
Philly Shipyard	492	326	203
AMSC (excl. TRS)	276	358	385
Solstad Offshore	353	287	101
Other	30	19	13
Total value	1 152	990	701
AMSC TRS1)	68	213	(32)
1) From Q4 2018 inluded in «interest-free liabilities» if negative value and within «other financial investments» if positive value.

Financial Investments

Real estate and other financial investments

% of gross asset value (31.12.2018)

Cash funding of Aker Energy increased by NOK 167 million. Outstanding amounts converted into equity in December. NOK million 4Q 17 3Q 18 4Q 18

Aker's investment

Real estate	674	568	568
Aker Energy	-	302	471
Other financial investments	2 261	1 886	1 902
Total value	2 934	2 756	2 942

Aker Financial Statements

Aker ASA and holding companies

Balance sheet at 31.12.2018

(after dividend allocation of NOK 22.50 per share)

Aker ASA and holding companies Interest-bearing items as of 31.12.2018

Average debt maturity is 2.5 years For details of interest-bearing items and loan guarantees, see: https://www.akerasa.com/Investor/Treasury

NOK million

Financial Covenants	Limit	Status at 31.12.2018
i Total Debt/Equity - Aker ASA (parent only)	< 80%	44%
ii Group Loans to NAV or Group Loans	< 50% < NOK 10 bn	1.7% NOK 0.7 bn

Aker ASA and holding companies Income statement

Amounts in NOK million	3Q 2018	4Q 2018	Year 2017	Year 2018
Sales gains	-	-	-	194
Operating expenses	(67)	(58)	(244)	(254)
EBITDA	(67)	(58)	(244)	(60)
Depreciation and impairment	(5)	(5)	(14)	(18)
Value change	(102)	(628)	(289)	(383)
Net other financial items	482	410	1 380	1 927
Profit before tax	309	(281)	833	1 467

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.