Earnings Release • Feb 18, 2016
Earnings Release
Open in ViewerOpens in native device viewer
| This Quarter | |
|---|---|
| Operating Revenue EBITDA |
558 mNOK 56 mNOK |
| Cash Flow from Operations Order Intake* |
168 mNOK 2053 mNOK |
| TRIF Employees** |
2,5 1604 |
$\overline{c}$
** Employees end of quarter
*includes frame agreements and exercise of options
Highlights for Beerenberg (Beerenberg Holdco II AS consolidated) in the 4th quarter 2015 was
Activity in the $4th$ quarter was in line with last year. The overall drop in maintenance and modification activity was offset by the higher activity on greenfield projects.
In order to adapt to the prevailing market conditions, the company has decided to concentrate the production of insulation materials at its Polish facility and close down production in Norway. The restructuring costs recognized in 4th quarter 2015 includes write down of assets of MNOK 10 and provisions for other costs of MNOK 9.
EBITDA was MNOK 56, slightly down compared to 4th quarter 2014 due to restructuring costs.
For the year Beerenberg increased its revenue by 2 % due to the increased activity within greenfield projects.
The EBITDA for the year was MNOK 276, a reduction of MNOK 4 compared to last year.
Profit before tax in 2015 increased by MNOK 60 compared to 2014. In 2014 the company incurred significant financial expenses related to refinancing of the company.
Total assets was MNOK 2 057 at the end of the quarter with an equity ratio of 20%.
Working capital improved significantly in the $4th$ quarter, in part due to prepayments from certain clients and in part due to concluding commercial discussions on ongoing projects.
Net interest bearing debt was MNOK 770 compared to MNOK 940 in 4th quarter 2014.
Most of Beerenberg debt is long term as a result of the issuing of a senior secured bond in 2nd quarter 2014.
Cash flow from operations was MNOK 168 for the 4th quarter of 2015 is mainly due to improvement in working capital during the quarter. Net investment in the quarter was MNOK 11, mainly related to equipment.
Net cash flow for the year was MNOK 174.
The market outlook for Beerenberg remains mixed. The drop in oil-price has re-enforced a number of cut backs related to running Maintenance & Modification contracts which has impacted the activity level.
The tender activity in 2015 has been high.
Most of the ISS contracts on Maintenance and Modification have been or are in the process of being retendered.
In November Beerenberg was awarded a 10 year maintenance and modification contract (estimated BNOK $2)$ .
In January 2016 Beerenberg was awarded a 15 year offshore maintenance and modification contract (estimated BNOK 8). Please see note 8 for subsequent events.
Total order intake of MNOK 2053 is recognized in 4th quarter 2015 (including uncommitted options and frame agreements).
Total estimated order backlog of MNOK 7 685 includes uncommitted options and frame agreements. Please note that the backlog includes Maintenance & Modification contracts currently being retendered and does not reflect significant awards in January.
At the end of Q4 2015 Beerenberg had 1604 employees.
In October, Beerenberg has initiated a reduction of workforce of approx. 220 employees due to expected lower activity offshore. In January 2016 it has announced further restructuring with concentrating production of insulation products in Poland.
During the 4th quarter 2015 Beerenberg recorded no incidents compared to 2 same period last year.
Total recordable incident frequency (TRIF) was 2,5 measured on last twelve months basis (LTM), compared to 5,2 YTD at the end of 4th quarter 2014.
The Services segment reports a decreased revenue q-o-q of 7% to MNOK 492. The decrease in revenue relates to reduction in activity in maintenance and modification partially offset by increase in greenfield projects. EBITDA was MNOK 44, down from MNOK 53 in 4th quarter 2014. The reduction in margin relate to delivery mix and somewhat lower margin on greenfield projects.
The Benarx division (Prefabricated insulation topside and subsea) continues to grow. Revenue was MNOK 158, a qo-q growth of 102 %. EBITDA and EBITDA margin in the quarter was MNOK 12 (7,6%) compared to MNOK 10 (13,1 %) in 4th quarter 2014. The EBITDA includes restructuring costs. The margin improvement (net of restructuring) reflects the impact of higher volumes.
| Group Summary | Q4 | Q4 | YTD | YTD | FY | |
|---|---|---|---|---|---|---|
| Amounts in NOK million | Note | 2015 | 2014 | 2015 | 2014 | 2014 |
| Operating revenues and other income | 6 | 558,4 | 564,3 | 2 3 6 3, 2 | 2 3 0 6, 3 | 2 3 0 6, 3 |
| Operating Expenses | 502,4 | 502,0 | 2087,5 | 2026,0 | 2026,0 | |
| EBITDA | $\overline{7}$ | 56,0 | 62,3 | 275,7 | 280,4 | 280,4 |
| Depreciation | 18,6 | 8,2 | 45,3 | 31,1 | 31,1 | |
| EBITA | 37,4 | 54,0 | 230,4 | 249,3 | 249,3 | |
| Amortisation | 8,4 | 10,3 | 36,5 | 41,0 | 41,0 | |
| Operating profit (EBIT) | 29,0 | 43,8 | 194,0 | 208,3 | 208,3 | |
| Financial expenses | $\overline{4}$ | 18,5 | 32,5 | 75,1 | 149,3 | 149,3 |
| Profit before tax (EBT) | 10,6 | 11,3 | 118,9 | 59,0 | 59,0 | |
| Estimated tax | 1,8 | 5,1 | 31,1 | 18,0 | 18,0 | |
| Net profit | 8,7 | 6, 2 | 87,8 | 41,0 | 41,0 | |
| Profit for the period is attributable to: | ||||||
| Shareholders of the parent company | 8,7 | 6, 2 | 87,8 | 41,0 | 41,0 | |
| Basic earnings per share (NOK) Diluted earnings per share are identical as there are no dilutive effect |
0,03 | 0,02 | 0,33 | 0, 15 | 0, 15 | |
| EBITDA margin | 10,0% | 12,4% | 11,7% | 12,2% | 12,2% | |
| EBITA margin | 6,7% | 11.1% | 9,8% | 10,8% | 10,8% |
| Q4 | Q4 | YTD | YTD | FY. | |
|---|---|---|---|---|---|
| Amounts in NOK million Note |
2015 | 2014 | 2015 | 2014 | 2014 |
| Net profit for the period | 8,7 | 6,2 | 87,8 | 41,0 | 41,0 |
| Other comprehensive income: | |||||
| Conversion differences | 0,4 | 0,0 | 0,4 | $-0.2$ | $-0.2$ |
| Reclassification related to prior periods | 0,0 | 1,5 | 0,0 | 0,0 | 0,0 |
| Change in value of derivatives | $-0,3$ | $-1,6$ | $-4.2$ | $-1,1$ | $-1,1$ |
| Total comprehensive income | 8,8 | 6,1 | 83,9 | 39,8 | 39,8 |
| Q4 Q4 FY 31.12.2015 31.12.2014 31.12.2014 Amounts in NOK million Note 883,9 883,9 Goodwill 883,9 153,6 187,2 Intangible assets 187,2 Buildings and other property 13,1 15,2 15,2 160,9 184,0 Machinery and equipment 184,0 Tools, Office machinery and similar assets 9,2 4,3 4,3 Financial Fixed Assets 0,0 0,0 0,0 Total non-current assets 1220,6 1274,5 1274,5 53,4 38,8 38,8 Inventories 386,6 Trade Debitors 215,0 215,0 238,7 238,7 Earned Not Invoiced Revenue (WIP) 112,4 Other Short Term Receivables 18,5 22,6 22,6 Prepayments 0,7 1,1 1,1 90,6 Bank Deposit 264,8 90,6 Total Current Assets 836,4 606,9 606,9 TOTAL ASSETS 2057,0 1881.4 1881,4 Share Capital 26,7 26,7 26,7 240,3 240.3 240,3 Share premium 59,3 22,2 22,2 Retained Earnings 87,8 41,0 41,0 Current year result after est. Tax 414,2 330,2 330,2 Total equity Deferred tax 27,5 40,3 40,3 Pension Liability 6,5 7,9 7,9 Warranty 9,4 4,0 4,0 Financial Lease Ioan 1,8 5,7 5,7 Bond 1030,0 1024,0 1024,0 4 30,0 33,0 33,0 Derivatives Total non-current liabilities 1 1 0 5,2 1115,0 1115,0 Current Liabilities Overdraft & S/T debt 3,1 0,4 0,4 137,4 Trade Creditors 123,0 137,4 38,5 38,5 Current Tax Payable 42,4 108.8 79,6 79,6 Social Security, VAT and other taxes 66,1 Accruals 117,8 66,1 Deferred Revenue 47,7 10,5 10,5 Other Current Liabilities 94,9 103,6 103,6 Total Current Liabilities 537,7 436,2 436,2 TOTAL EQUITY & LIABILITY 2057,0 1881,4 1881,4 |
Group Summary | ||
|---|---|---|---|
| Conversion | Hedging | Retained | ||||
|---|---|---|---|---|---|---|
| Share capital | Share premium | reserve | reserve | earnings | Total | |
| 01. January 2015 | 26.7 | 240.3 | 0.0 | $-1.6$ | 64.8 | 330,2 |
| Profit for the year | 87.8 | 87,8 | ||||
| Other Comprehensive Income | $\cap$ 4 | $-42$ | $-3.9$ | |||
| Equity as per 31.12.2015 | 26.7 | 240.3 | 0.4 | $-5.8$ | 152.6 | 414,2 |
| Conversion | Hedging | Retained | ||||
|---|---|---|---|---|---|---|
| Share capital | Share premium | reserve | reserve | earnings | Total | |
| 01. January 2014 | 26,7 | 240.3 | $-1.2$ | $-0.7$ | 25.5 | 290,6 |
| Result | 41.0 | 41,0 | ||||
| Other Comprehensive Income | $-0.2$ | $-1,1$ | $-1,2$ | |||
| Correction of classification | 1,4 | 0,2 | $-1.6$ | 0,0 | ||
| Transactions with shareholders | $-0,1$ | $-0,1$ | ||||
| Equity as per 31.12.2014 | 26.7 | 240.3 | 0,0 | $-1.6$ | 64.8 | 330,2 |
| Q4 | Q4 | YTD | YTD | FY | ||
|---|---|---|---|---|---|---|
| Note | 2015 | 2014 | 2015 | 2014 | 2014 | |
| EBITDA | 56,0 | 62,3 | 275,7 | 280,4 | 280,4 | |
| Taxes paid | $-25,5$ | $-4,9$ | $-38,5$ | $-13,5$ | $-13,5$ | |
| Change in net working capital | 138,5 | 17,2 | 39,6 | $-44,1$ | $-44,1$ | |
| Changes to other time restricted items | -0,6 | $-1,3$ | $-4,5$ | $-1,2$ | $-1,2$ | |
| Net Cash flow from operating activites | 168,4 | 73,4 | 272,3 | 221,6 | 221,6 | |
| Capex | $-11,1$ | $-12,7$ | $-27,8$ | $-68,7$ | -68,7 | |
| Net cash flow from investing activities | $-11,1$ | $-12,7$ | $-27,8$ | $-68,7$ | $-68,7$ | |
| Repayment of interest bearing debt | 4 | $-0,3$ | $-56,2$ | $-3,9$ | $-1150,8$ | $-1150,8$ |
| Purchase of shares | 0,0 | 3,1 | 0,0 | 6,2 | 6,2 | |
| Net incoming payment from Bond | 0,0 | 0,0 | 0,0 | 1078,5 | 1078,5 | |
| Interest paid | $-14,2$ | $-18,3$ | $-66,3$ | $-68,1$ | $-68,1$ | |
| Net cash flow from financing activities | $-14,6$ | $-71,3$ | $-70,3$ | $-134,2$ | $-134,2$ | |
| Total cash flow | 142,7 | $-10,6$ | 174,2 | 18,7 | 18,7 | |
| Opening balance net bank deposits | 122,0 | 101,2 | 90,6 | 71,9 | 71,9 | |
| Closing balance net bank deposits | 264,8 | 90.6 | 264,8 | 90,6 | 90,6 |
Beerenberg Holdco II AS is a company domiciled in Norway. The consolidated financial statements of Beerenberg Holdco II comprise the company and its subsidiaries, together referred to as the Group. The Beerenberg Holdco II Group was established 01. March 2013, as a result of the Beerenberg Holdco II AS acquisition of all shares in Beerenberg Holding AS.
Beerenberg is delivering products and services to its customer in complex environments implying substantial operational risk with regards to quality, cost, time and not at least to injuries and accidents (HSE). Beerenberg works systematically to mitigate and manage risk on all levels. The annual report for 2014 provides further information on risks and uncertainties applicable to Beerenberg.
Beerenberg Holdco II AS is wholly owned by Beerenberg Holdco I AS which is wholly owned by Beerenberg Invest AS. Shareholders in Beerenberg Invest are specified in table below.
| Shareholders Beerenberg Invest | A-Shares | $\%$ | B-Shares | ℅ | Total Shares | $\%$ |
|---|---|---|---|---|---|---|
| Segulah IV L.P. | 804972 | 80,5 % 217 052 883 | 81,6 % | 217857855 | 81,6 % | |
| Alplnvest Partners 2012 B.V. | 92 1 2 1 | 9.2% | 24 931 110 | 9.4% | 25 023 231 | 9,4% |
| Alplnvest Partners 2012 II B.V. | 23319 | 2.3 % | 6310883 | 2.4% | 6 3 3 4 2 0 2 | 2,4% |
| Management | 79588 | 8.0 % | 17 705 124 | 6.7 % | 17 784 712 | 6,7 % |
| Total | 1 000 000 | 100,0 % 266 000 000 | 100,0 % 267 000 000 | 100.0% |
The interim financial statements for the Group are prepared in accordance with International Financial Reporting Standards (IFRS) as approved by the European Union and their interpretations adopted by the International Accounting Standards Board (IASB).
The interim report does not include all the information required for full annual consolidated financial statements, and should be read in conjunction with the financial statements of the Group for 2014. The accounting policies applied in the interim financial statements is the same as those described in the annual report for 2014. The condensed consolidated interim financial statements are prepared in accordance with IAS 34 Interim Financial Reporting. The interim financial statements are unaudited.
The Annual Report for 2014 is available at www.Beerenberg.com
In applying the accounting policies, management makes judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, income and expenses. The estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Revision to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
In preparing these interim financial statement, the significant judgments made by management in applying the Group's accounting policies and the key sources of uncertainty in the estimates were consistent with those applied to the consolidated financial statements for the period ended 31. December 2014.
A bond of MNOK 1100 was issued in Q2 2014. In the same quarter long term loans to financial institutions and long term Ioan from the parent company Beerenberg Holdco I AS was fully repaid. In Q4 2014 the Group repurchased own Bonds with face value totaling MNOK 55.
The Bond implies covenants related to Incurrence testing, and quarterly Net Total Leverage ratio test (below 9.0). The Group is in compliance with covenants as of 31.12.2015.
No related party transactions were conducted in Q4 2015.
From December 2014 Beerenberg changed its organization to optimize and focus its business. The former Cold Work Concepts and Maintenance and modification division was merged into one segment, Services. Segment figures for Services for Q4 2014 and YTD 2014 are for the two previous segments Cold Work Concepts and Maintenance & Modifications combined. The Benarx business segment, which consists of advanced insulation topside and subsea, remains unchanged.
| Q4 | Q4 | YTD | YTD | FY. | |
|---|---|---|---|---|---|
| Amounts in NOK million | 2015 | 2014 | 2015 | 2014 | 2014 |
| Services | 491,7 | 527,9 | 2 1 8 4, 8 | 2 1 2 3,0 | 2 1 2 3,0 |
| Benarx | 157,9 | 78,5 | 535,7 | 264,0 | 264,0 |
| Eliminations | $-91.2$ | $-42.1$ | $-357.3$ | $-80.8$ | $-80,8$ |
| Total | 558,4 | 564,3 | 2 3 6 3, 2 | 2306.3 | 2 3 0 6, 3 |
| Q4 | Q4 | YTD | YTD | FY. | |
|---|---|---|---|---|---|
| Amounts in NOK million | 2015 | 2014 | 2015 | 2014 | 2014 |
| Services | 43,8 | 52,6 | 194,5 | 256,1 | 256,1 |
| Benarx | 12,3 | 10,3 | 81,2 | 27,3 | 27,3 |
| Other and Eliminations | 0,0 | $-0,6$ | 0,0 | $-3.0$ | $-3.0$ |
| Total | 56,0 | 62,3 | 275,7 | 280,4 | 280,4 |
On the 5th of January 2016 Beerenberg entered into a new frame agreement with Statoil concerning offshore maintenance and modification of 11 installations. The estimated value of the 15 year contract is BNOK 8.
Building tools?
Free accounts include 100 API calls/year for testing.
Have a question? We'll get back to you promptly.