AI Terminal
Fjord Defence Group ASA
Annual Report • Apr 4, 2025
3569_10-k_2025-04-04_83a7253b-9137-4504-b156-838176acbf74.pdf
Annual Report
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| 1. | Board of directors report 2 | |
|---|---|---|
| 2. | Responsibility statement 9 | |
| 3. | Corporate governance report 10 | |
| 4. | Consolidated financial statement 18 | |
| Consolidated statement of comprehensive income 18 | ||
| Consolidated statement of financial position 19 | ||
| Consolidated statement of change in equity 21 | ||
| Consolidated statement of cash flow 22 | ||
| Notes to the consolidated financial statement 23 | ||
| 5. | Financial statement Aquila Holdings ASA 47 | |
| Statement of comprehensive income 47 | ||
| Statement of financial position 48 | ||
| Statement of changes in equity 50 | ||
| Statement of cash flow 51 | ||
| Notes to the financial statements 52 | ||
| 6. | Auditors report 62 | |
| 7. | Sustainability report 67 |
Aquila Holdings ASA ("Aquila" or the "Company") and its subsidiaries (together referred to as the "Group") is a seismic multi-client and investment company. The legacy seismic business manages a seismic ocean bottom node multi-client data library. The corporate headquarters of Aquila is Askekroken 11, 0277 Oslo, Norway. The Company is listed on Euronext Expand Oslo and traded under the ticker AQUIL.
The Company's investment arm may invest broadly in listed companies as well as companies expected to be listed in the near term. Aquila will selectively consider additional investments going forward.
The Company's legacy seismic business operates under the name Axxis Geo Solutions. The Company manages a seismic multi-client data library with assets in Norway and Egypt.
The seismic multi-client data business model is frequently the preferred way to access seismic data for petroleum exploration and production (E&P) companies. The seismic data is licensed by E&P companies to assist in the discovery and development of petroleum resources. The Group's return on investment from its multi-client library is seen through the life span of the data; from its early stage with revenues coming from the pre-funding by E&P companies during the execution of the program, through subsequent late sales after the seismic images are processed and available.
The Group's multi-client data is targeting near-field exploration, where production infrastructure is in place and where E&P companies need high-quality seismic data to unlock existing and new resources. In these production fields, oil and gas can be developed with lower cost, environmental impact and emissions.
With a sustained high oil price (in the range \$75-85 per barrel of oil equivalent), it is expected that near-field exploration will continue to be considered highly attractive for the E&P companies. Aquila expects the investment in exploration and development in our core areas to be durable and reinforced by the attractive long-term demand outlook.
Accounting principles
The consolidated financial statements are prepared in accordance with IFRS as adopted by the European Union.
The Company has not adopted any standards, interpretations or amendments that have been issued but are not yet effective.
All financial statements in this report are presented on a going concern basis in accordance with the Norwegian Accounting Act section 3-3a, and the Board of Directors confirms that the prerequisites for going concern assumption are present.
Financial results, financial position and capitalization
Revenues related to multi-client data are recognized at the point of delivery of completed data to the customer, leading to relatively high volatility in results quarterly and annually. Revenues related to reprocessing of multi-client data is recognized over time and is booked according to percentage of completion.
Revenues in 2024 amounted to USD 3.9 million compared to USD 8.2 million in 2023. The decrease is driven by less revenues arising from the reprocessing of the Utsira data library in 2024 compared to 2023.
A USD 0.7 million reduction in fair value of financial assets was recognized under other gains and losses in 2024 compared to a loss of USD 1.0 million in 2023.
Changes in the fair value of the investment portfolio in 2024 was a loss of USD 1.8 million compared to a loss of USD 0.3 million in 2023.
Cost of sales of USD 3.9 million for 2024 compares to USD 5.8 million during the same period in 2023. The cost decrease is driven by less costs related to the reprocessing of the Utsira data library.
The selling, general and administrative costs was USD 2.0 million for 2024 compared to USD 2.5 million in 2023.
The straight-line amortization of the multi-client library was USD 6.4 million for 2024 which was the same as for 2023. An impairment charge of USD 2.6 million was made in the fourth quarter of 2024 for Utsira multi-client survey.
Operating loss for 2024 was USD 12.3 million compared to operating loss of USD 7.7 million in 2023.
Net financial items amounted to a gain of USD 33 thousand in 2024 compared to a cost of USD 0.4 million in 2023.
Income tax for 2024 was a gain of USD 1.5 million related to foreign corporate taxes, compared to a gain of USD 7 thousand 2023.
The Company has not recognized any deferred tax assets in the balance sheet as of 31 December 2024. Tax loss carried forwards per 31 December 2023 was USD 45.9 million.
The Group has a net loss of USD 10.7 million in 2024 compared to a net loss of USD 8.1 million in 2023.
As of 31 December 2024, the Company had total assets of USD 28.8 million, compared to USD 43.9 million as of 31 December 2023.
Total non-current assets of USD 27.6 million as of 31 December 2024 compared to USD 39.7 million as of 31 December 2023. The reduction is mainly driven by amortization and impairment of the multi-client library.
Total current assets decreased from USD 4.2 million as of 31 December 2023 to USD 1.1 million as of 31 December 2024. The Company's cash balance ended at USD 1.1 million on 31 December 2024.
The Group's net equity was USD 27.0 million at the end of December 2024, representing a net decrease of USD 11.1 million compared to 31 December 2023. The equity ratio is 94.0% as of 31 December 2024 compared to 86.9% as of 31 December 2023.
Total current liabilities decreased with USD 4.0 million compared to 2023, mainly due to decrease related to estimated income tax liabilities arising from the operations in Egypt. The material part of other current liabilities is related to estimated Egypt taxes.
Cash flow from operations, investments and financing
The Group's cash flow from operating activities in 2024 was negative with USD 0.8 million compared to positive with USD 1.3 million in 2023.
The Group's cash flow from investment activities in 2024 was positive with USD 0.5 million due to sale of shares in Dolphin Drilling. There was no investment or sale of shares in 2023.
The Group's cash flow from financing activities in 2024 was mainly due to purchasing of own shares of USD 0.4 million compared to USD 1.4 million in 2023.
Key financial indicators
USD thousands
| Profit and loss | 2024 | 2023 |
|---|---|---|
| Revenue | 3 914 | 8 237 |
| Changes in fair value of investments (loss) | (1 779) | (251) |
| Operating profit (loss) (EBIT) | (12 261) | (7 686) |
| Cash earnings * | (2 019) | (26) |
| Net profit (loss) | (10 722) | (8 087) |
| Basic earnings (loss) per weighted average shares (in USD) | (0.05) | (0.04) |
| Financial position | 31.12.2024 | 31.12.2023 |
| Bank deposits | 1 054 | 2 038 |
| Available liquid funds ** | 4 963 | 8 457 |
| Total assets | 28 764 | 43 882 |
| Total equity | 27 029 | 38 120 |
| Ratio analysis | 31.12.2024 | 31.12.2023 |
| Equity ratio | 94.0 % | 86.9 % |
| Net asset value per share (NOK) *** | 1.42 | 1.76 |
* Revenue, cost of sales, SG&A
** Bank deposits, net trade receivable, marketable securities
*** Net asset value per share; total assets – total liabilities divided by number of shares
Risk management and internal control
Aquila's activities are dependent on the capital spending budgets of E&P companies in the oil and gas industry. These budgets are, in turn, largely a function of actual and/or expected shifts in oil and gas prices. Consequently, Aquila's activities, opportunities and profitability are linked to fluctuations in these prices.
The multi-client library is the Group's largest asset. The surveys in the library are subject to commercial risk. At times, Aquila will have to impair the values of the surveys if the future licensing potential diminishes because of market conditions, regulatory changes, lack of exploration success in the relevant area, changes in customers' strategic priorities, etc.
The Group is also exposed to capital markets developments resulting in fluctuations in the market values of investments in shares and non-listed shares. There is also a risk that the companies in the investment portfolio will need further capital to obtain profitability, and that such capital will be subject to reduced pricing compared to the current pricing.
Liquidity risk arises from a lack of correlation between free cash and financial commitments. As of 31 December 2024, Aquila held current assets of USD 1.1 million mainly represented by cash and cash equivalents, and current liabilities were USD 1.7 million. The Board considers the liquidity risk of the Group to be low.
Aquila is exposed to credit risk through sales and receivables and uses it best efforts to manage this risk by monitoring receivables and implementing credit checks and other actions as deemed appropriate in addition, excess cash is placed in either bank deposits or financial instruments that have a minimum rating of 'investment grade'.
The Group's maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets, such as account receivables, other short-term receivables, and noncurrent assets. Aquila evaluates the concentration of risk with respect to trade receivables as low due to the Group's credit rating procedures and because our customers generally are large energy companies considered to be financially sound. Aquila is focused on maintaining adequate internal controls.
Aquila is exposed to financial risk such as currency, liquidity, and credit risk. The operational exposure to currency risk is low as a significant portion of revenues earned and costs incurred are in USD. However, as a significant part of the Group's taxes are calculated and paid in NOK and EGP, fluctuations between NOK/EGP and the USD result in currency exchange gain or losses. Any potential dividends are likely to be paid in NOK and fluctuations between NOK and USD could result in currency exchange gains or losses.
Aquila operates in a range of tax jurisdictions with complex considerations and legislation concerning both indirect and direct taxation, especially in Egypt. Thus, uncertainties exist related to reported tax liabilities and exposures. Recognized taxes (both direct and indirect) are based on all known and available information and represent our best estimate as of the day of reporting.
The jurisdictions in which Aquila operates are also subject to changing tax regulations, which may impact assessments, for instance concerning the recoverability of credits. Furthermore, tax authorities may challenge the calculation of both taxes and credits from prior periods. Such processes and proceedings may result in changes to previously reported and calculated tax positions, which in turn may lead to Aquila having to recognize operating of financial expenses in the period of change.
The Group's multi-client business relies on a period of exclusivity in controlling the distribution of the acquired data through licenses to customers. The exclusivity period granted by local authorities is typically 10 years. Any change in the duration of such exclusivity may have a negative impact on the Company's revenues and may cause impairment of remaining book values.
Aquila is exposed to different types of climate-related risks, which are addressed by the Board of Directors' sustainability strategy. Please refer to the sustainability report for more details.
The Group is exposed to risk associated with cybersecurity. Please refer to the sustainability report for more details.
Reference is made to Note 15 of the consolidated financial statements and to the more detailed information on risk management and Internal control in the corporate governance section of the annual report.
Organization, working environment and equal opportunity
At the end of 2024, Aquila employs 2.7 man-years compared to 2.7 in 2023.
The Board considers the working environment to be good. Please refer to the sustainability report for more details about the workforce.
Health, safety and environmental
Aquila is fully committed to safeguarding and maintaining the environment in which we operate and live, while also providing a safe and healthy workplace for our employees, contractors, vendors, and customers. Aquila manages and monitors these activities through corporate policies, procedures and guidelines.
More detailed information on Aquila's health, safety and environmental initiatives may be found in the sustainability report, included in a separate section of the annual report.
Sustainability and corporate social responsibility
Ensuring that Aquila's business operates in a sustainable way and provides sustainable solutions for our customers is high on the Board of Directors agenda.
Aquila is committed to minimizing and mitigating the potential disruption to the marine and onshore environment and climate that may be caused by its operations. Proper project planning and management as well as coordination with our vendors, partners and local communities play a significant role in ensuring that our operations do not have a detrimental impact on the environment.
For more information, including information on the Norwegian Transparency Act, please refer to the sustainability report, included in a separate section of this annual report.
Board structure and corporate governance
The Board of Directors consists of three directors serving until the annual general meeting in 2025. All the directors are independent. The audit committee consists of two members.
Aquila has an independent nomination committee consisting of two members elected by the shareholders.
No material transactions other than the remuneration disclosed in Note 18 of the consolidated financial statements have occurred in 2024 between Aquila and its management, directors and its shareholders.
Aquila emphasizes independence and integrity in all matters relating to the Board of Directors, management and its shareholders.
The Group conducts a compliance program designed to continually inform and educate employees on ethical and legal issues.
Aquila bases its corporate governance policies and practices on the Norwegian Code of Practice for Corporate Governance issued on 14 October 2021 (the "Code of Practice"). The Board of Directors believes that Aquila complies in all areas with the Code of Practice and will address compliance with any subsequent amendments. A more detailed description on how Aquila complies with the Code of Practice and the Norwegian Accounting Act's requirements for reporting on corporate governance is included in the report on corporate governance included in this annual report.
Salary and compensation
Aquila compensates its employees according to market conditions that are reviewed on an annual basis including base salary, insurance and retirement benefits programs. For further details, please refer to note 18 of the report on consolidated financial statements.
The members of the Board of Directors do not participate in any bonus plan, profit-sharing plan or stock incentive plan. The directors' compensation is based on a fixed fee. The remuneration is not related to the Group's financial results.
The Group has international liability insurance for the Board of Directors and management. The insurance coverage is up to NOK 50 million per year for total revenue of NOK 612 million.
Annual result for the parent company and allocation of result
In 2024 and 2023, the Group's parent company Aquila Holdings ASA did not have any revenues.
In 2024, Aquila reported a loss after tax of USD 10.8 million compared to a loss after tax of USD 2.8 million in 2023. The reported loss was mainly caused by impairment of receivables and shares in subsidiaries in addition to change in fair value of financial assets and personnel and other operating expenses. Last year's loss was caused by the change in fair value of financial assets in addition to personnel and other operating expenses.
At year-end 2024, Aquila had total assets of USD 27.7 million compared to USD 48.2 million at the end of 2023. Investment in shares in subsidiaries is reduced with USD 12.7 mainly due to return of capital. Financial asset is reduced with USD 0.7 million due to the change in fair value described above. Intercompany receivables are reduced with USD 6.5 million because of impairment. The bank balance at year end was USD 0.8 million, a decrease of USD 0.7 million compared to last year.
As of 31 December 2024, Aquila has a net equity of USD 27.2 million, compared to USD 38.4 million at the end of 2023. The equity ratio 31 December 2024 was 98.5 % compared to 79.6% at the end of 2023. Total current liabilities have decreased with USD 9.4 million compared to last year due to received dividends as return of capital used to settle intercompany liabilities.
The Board of Directors has proposed the loss for the Company of USD 10.8 million to be allocated to accumulated earnings.
Outlook
Global demand for oil and gas is forecasted to continue to grow. This will support additional exploration activity, both as it relates to near-LJeld optimization, but also with respect to new prospects. We do see a resistance to discretionary exploration spending, and this may impact late sales in the near term. Moreover, multi-client sales will continue to be lumpy and less predictable. The E&P sector has been consolidating in recent years, yielding revenues in the form of transfer fees from acquiring companies. Going forward, we expect to see both more M&A activity among our clients, but we also expect new actors to form and enter the North Sea market.
We continue to review potential strategic transactions both within the seismic industry and other segments, to create further shareholder value.
Events after the reporting period
In January 2025 the Group accepted a sales oDžer for the shares in ArbaNJame at NOK 1.15 per share. The oDžer was accepted, and the sale resulted in a seǘlement of USD 0.4 million (NOK 4.5 million). Seǘlement for the sale of the shares was received in January 2025.
In March 2025 the company received settlement of its financial asset related to the sale of ocean bottom node (OBN) equipment to TGS (via Magseis Fairfield), originally concluded in March 2022. As part of the earnout structure agreed upon in the transaction, the company has received the year-three floor payment of USD 1.5 million.
Oslo, 3 April 2025
The Board of Directors and CEO of Aquila Holdings ASA
Chair Director Director
Nina Skage Ketil Skorstad Torstein Sanness
Kristian Zahl Interim CEO
2.Responsibility statement
Confirmation from the Board of Directors and general manager
The Board of Directors and the chief executive officer of Aquila Holdings ASA have today considered and approved the annual report and financial statements for the 2024 calendar year ended on 31 December 2024.
We confirm, to the best of our knowledge, that:
- The 2024 financial statements for the Group and the Company have been prepared in accordance with all applicable accounting standards.
- The information provided gives a true and fair view of the Group's and the Company's assets, liabilities, financial position and results.
- The Board of Directors report provides a true and fair overview of the development, performance and financial position of the Group and the Company, together with a description of the principal risks and uncertainties that they face.
Oslo, 3 April 2025
The Board of Directors and CEO of Aquila Holdings ASA
Chair Director Director
Nina Skage Ketil Skorstad Torstein Sanness
Kristian Zahl Interim CEO
Implementation and reporting on corporate governance
The Company has established a corporate culture to build confidence and trust among its stakeholders. Key elements are open and honest communication, a system of internal controls and policies and a compliance program.
The Company's corporate governance is based on the following main objectives:
- a. Open, reliable, and relevant communication with the outside world regarding the Company's business and matters related to corporate governance.
- b. Equal treatment of the Company's shareholders.
- c. Independence between the board, the management and the shareholders to avoid conflicts of interests.
- d. A clear division of work between the board, management and shareholders.
- e. Good control and corporate governance mechanisms to achieve predictability and reduce the level of risks for shareholders and stakeholders.
The Company endorses and complies with the Norwegian Code of Practice of Corporate Governance (the "Code of Practice") dated 14 October 2021 found at www.nues.no. The Code of Practice is based on a "comply or explain" principle, which means that listed companies must comply with the Code of Practice or explain why an alternative approach has been chosen. The Company will comply with the Code of Practice and any deviations will be listed below.
Business conduct
Policies for ethics and corporate social responsibility have been established.
It is important for the Company to be aware of potential problems as early as possible and procedures have been put in place to require employees to report any known or suspected ethical irregularities. The Company has in place appropriate whistleblower procedures for individuals to report concerns of non-compliance. A more detailed descriptions of our compliance program is included in our sustainability report which is included in our annual report.
The Group is committed to ensuring a safe and respectful working environment for its employees. The health and wellbeing of our people is the key to the Company's success. Equality applies to all practices and guidelines relating to the recruitment process and hiring of all workers. We respect and protect the fundamental human and workers' rights in a manner consistent with laws and regulations.
The Group promotes a healthy workplace by prohibiting discrimination due to gender, race, age, ethnicity, disability, sexual orientation or religion and provides fair compensation for employees' work. Respect for the individual is a cornerstone of the Group's operation.
A summary of the strategic direction and a risk review is included in the board of directors' report for 2024, which is part of the annual report 2024 and available on the company website.
Corporate social responsibility
The Company believes that sustainable business practices can fully support successful business development. A more detailed description of the Company's sustainability practices is included in the sustainability report which is included in the annual report.
Business
Aquila comprises an ocean bottom node multi-client company and an investment arm. The Company may invest broadly in listed companies as well as companies expected to be listed in the near term.
The Company's objectives and strategies are to create value for shareholders. When carrying out this work, the Company shall consider financial, social and environmental issues. The Company have policies for how it integrates the interests of the society at large into the value creation.
Equity and dividends
As of 31 December 2024, equity amounted to USD 27.0 million (including a share capital of USD 28.3 million). This corresponds to an equity ratio of 94.0%, which the Board of Directors ("Board") considers to be satisfactory. The adequacy of the Company's capital is monitored closely with respect to the Company's objectives, strategy and risk profile.
The Board proposes any distribution of dividends to the annual general meeting. The annual general meeting determines any distribution of dividends in accordance with Section 8-1 and Section 8-2 of the Norwegian Public Limited Companies Act. The grounds for any proposal to authorize the Board to approve the distribution of dividends shall be explained. The Board also considers share repurchases if this is deemed more attractive for our shareholders.
The annual general meeting in May 2024 approved repurchase of own shares up to 10% of nominal value. The Board has not proposed any dividends to be paid for the financial year 2024.
Any proposed authorizations to the Board to increase the Company's share capital shall be restricted to defined purposes and shall be dealt with as separate agenda items at the general meeting.
The Board authorizations shall be limited in time to the date of the next annual general meeting, but in no event later than 30 June the same year. This also applies to any authorization to the Board for the Company to purchase its own shares.
Equal treatment of shareholders and transactions with close associates
The Company has only one class of shares. All shares have one vote each and otherwise equal rights in all respects.
All shareholders shall be treated on an equal basis unless there is a just cause for treating them differently in accordance with applicable laws and regulations. In the event of an increase in the share capital of the Company through issuance of new shares, a decision to waive the existing shareholders' pre-emptive rights to subscribe for shares shall be justified. If the Board resolves to issue new shares and waive the pre-emptive rights of existing shareholders pursuant to a Board authorization granted by the general meeting, the justification shall be publicly disclosed in a stock exchange announcement issued in connection with the shares issue. The reasons for any deviation from equal treatment of all shareholders in capital transactions will be included in the stock exchange announcement made in connection with the transaction.
Any transactions carried out by the Company in the Company's own shares shall be carried out on Euronext Expand Oslo and in any case at prevailing stock exchange prices. If there is limited liquidity in the Company's shares, the Company shall consider other ways to ensure equal treatment from shareholders. Any transactions in own shares will be evaluated in relation to the rules on the duty of disclosure, as well as in relation to the prohibition against illegal insider trading and market manipulation, the requirement for equal treatment of all shareholders and the prohibition of unreasonable business methods.
Transactions with close associates
Any transactions, agreements or arrangements between the Company and shareholders; a shareholder's parent company; members of the management or close associates of any such parties, may only be entered into as part of the ordinary course of business and on arm's length market terms. All such transactions shall where relevantly comply with the procedures set out in the (NPLLCA). The Board shall obtain an independent third-party evaluation, unless the transaction, agreement or arrangement in question is immaterial or covered by the provisions of section 3-16 of the NPLLCA.
Freely negotiable shares
There shall be no limitation with respect to any party's ability to own, trade or vote for the Company's shares. The articles of association contain no restrictions on negotiability of the shares.
General meetings
The annual general meeting is the ultimate corporate body. The Board and the chief executive officer are typically present at the annual general meeting, as well as the company's auditor. The minutes from the annual general meeting and any extraordinary general meeting are made available on the Company's website shortly after the date of any such general meeting and are also available for inspection at the Company's corporate office in Oslo.
The annual general meeting for 2025 will be held on 22 May 2025. The notices for the annual general meeting and any extraordinary meeting and all supporting documents are made available on the Company's website no later than three weeks in advance of the meeting. The notice is also mailed (post or email) to registered shareholders.
The last annual general meeting was on 23 May 2024, the minutes from which are available on the Company's website.
Exercise of rights
The Board shall ensure that the Company's shareholders can participate at general meetings. This shall be facilitated by the following:
- The Board shall ensure that the Company's shareholders can participate in the general meeting.
- The proposed resolutions and any supporting documents shall be sufficiently detailed, comprehensive, and specific, allowing shareholders to understand and form a view on all matters to be considered.
- The deadline for shareholders to give notice of their attendance at the general meeting shall be no later than two business days prior to the date of the general meeting in accordance with the articles of association.
- Shareholders who cannot attend the meeting in person will be given the opportunity to vote. The Company will design the form for the appointment of a proxy to make voting on each individual matter possible and should nominate a person who can act as a proxy for shareholders.
- The Board and the chair of the general meeting shall ensure that the shareholders are able to vote separately on each individual matter, including on each individual candidate nominated for election to the Board and other corporate bodies (if applicable).
- The chair of the Board shall be present at general meetings. The auditor shall be present at general meetings where matters of relevance for the auditor is on the agenda. The Board shall ensure that the chair of the general meeting is independent.
Participation without being present
Shareholders who are unable to attend the general meeting shall according to the Company's articles of association be given the opportunity to vote in writing and/or vote electronically in a period before the general meeting in accordance with the NPLCA Section 5-8. Furthermore, shareholders who are unable to attend the general meeting in person shall be given the opportunity to vote by proxy. In this respect, the Company shall:
- Provide information in the notice to the general meeting on the procedure for attending by proxy.
- Nominate a person who can act as a proxy for shareholders.
- Prepare a proxy form, which shall, insofar as possible, be set up so that it is possible to vote on each individual item on the agenda and candidates that are nominated for election.
Nomination committee
The articles of association of the Company require it to have a nomination committee that is responsible for the nomination of directors to the Board and recommend remuneration payable to the directors.
The nomination committee shall consist of up to 3 members elected by a general meeting for a period of up to two years unless the general meeting decides a shorter period. The nomination committee shall make recommendations and prepare proposals to the general meeting for:
- Election of members to the Board and remuneration of the directors of the Board and any Board committees.
- Election of the nomination committee and remuneration of the nomination committee.
The proposals shall be made available no later than 21 days prior to the general meeting.
The nomination committee shall meet at least annually with the Board. The committee shall also consult with selected shareholders to ensure that the nomination committee has their support.
Board composition and independency
The Board shall be composed in a way that it can (i) attend to the common interests of all shareholders and meet the Company's need for expertise, capacity and diversity and (ii) act independently of special interests. The majority of the shareholder-elected Board members shall be independent of the management and significant business contacts. At least two of the members of the Board shall be independent of the Company's major shareholder(s).
For the purposes of these policies, a major shareholder shall mean a shareholder who owns or controls more than 10% of the Company's shares or votes, and independence shall entail that there are no circumstances or relations that may be expected to be able to influence an independent assessment of the person in question. The Board shall not include members of the management.
The chair of the Board is elected by annual general meeting. The term of office for members of the Board shall not be longer than two years at a time. Members of the Board may be reelected.
The Company's annual report shall provide information regarding the expertise of the members of the Board, as well as information on their history of attendance at board meetings. Further, the annual report shall identify the members of the Board that are independent. Members of the Board are encouraged to own shares in the Company.
The Board consists of three members all of whom are deemed independent of Aquila's management, major shareholders, and material business contacts.
The work of the board of directors
The Board is responsible for the overall management and supervision of the Company. The Board has implemented instructions for the Board and the management, focusing on determining a clear allocation of internal responsibilities and duties. The respective objectives, responsibilities and functions of the Board and the chief executive officer shall follow rules and standards applicable to the Company and are described in the Company's "Instructions for the Board" and "Instructions for the CEO".
The Board shall ensure that the members of the Board and the members of the management make the Board aware of any material interests that they may have in matters to be considered by the Board.
The Board's consideration of matters of a material character in which the chair of the Board is, or has been, personally involved, shall be chaired by another member of the Board to ensure a more independent consideration of the matter in question.
In 2024, there were 9 Board meetings where the following were participating.
Nina Skage 9 of 9 meetings Torstein Sanness 6 of 9 meetings Ketil Skorstad 5 of 9 meetings (personal deputy was attending the 3 missing meetings)
In 2024, there were 4 audit committee meetings where the following were participating.
| Nina Skage | 4 of 4 meetings |
|---|---|
| Torstein Sanness | 4 of 4 meetings |
Board committees
The Board has established an audit committee but has not appointed a remuneration committee. A remuneration committee has not been deemed to be of importance by the Board. The Board has decided to maintain a simple and cost-effective governance structure. The Board will determine the remuneration and compensation scheme of the Company in accordance with applicable law.
Audit committee
The Board has established an audit committee, which is a working committee for the Board, preparing matters and acting in an advisory capacity. The duties, tasks and composition of the audit committee shall follow the Norwegian Public Limited Liability Companies Act. In particular, the audit committee shall act as a preparatory body and support the Board in the exercise of its responsibility relating to financial reporting, auditing, internal controls, compliance with ethical policy such as environmental, social and governance.
The members of the audit committee are elected amongst the members of the Board for a term of up to two years. The entire Board shall not act as the Company's audit committee. At least one member of the audit committee should be competent in respect of finance and audit, and a majority of the members should be independent of the Company. The mandate of the audit committee is subject to annual revision.
The Board shall provide details in the annual report of the audit committee and any other board committees, if appointed.
Risk management and internal control
The Board monitors Aquila's risk exposure and oversees the Company's internal control systems for risk management to ensure they are appropriate for the Company's activities in relation to the extent and nature of the Group's business activities.
The Board carries out an annual review of the Group's most important areas of exposure to risk and its internal control measures. The review pays particular attention to:
- Changes relative to previous years' reports in respect of the nature and extent of material risks and the Company's ability to cope with changes in its business and external changes.
- The extent and quality of the management's routine monitoring of risks and the internal control system and, where relevant, the work of the internal control function
- The extent and frequency of the management's reporting to the Board on the results of such monitoring, and whether this reporting makes it possible for the Board to carry out an overall evaluation of the internal control situation in the Group and how risks are being managed.
- Events of material shortcomings or weaknesses in internal control that come to light during the year which have, could have, or may have had a significant effect on the Group's financial results or financial standing.
- How well the Company's external reporting process functions.
Based on the instructions by the Board, the chief executive officer implements internal control measures and proposes the same to the Board.
The chief executive officer effectuates internal control measures based on the instructions by the Board and reports the results to the Board annually in accordance with the Board's annual plan. The report to the Board provides a balanced presentation of all material risks and how such risks are handled through the internal control measures of the Company.
The main areas of internal control related to financial reporting are described and included in the corporate governance report and in the annual report. This account includes sufficient and properly structured information to make it possible for shareholders to understand how the Company's internal control system is organized. The account addresses the main areas of internal control related to financial reporting. This includes the control of environment, risk evaluation, control activities, information and communication and follow-ups.
Renumeration of the board of directors
The remuneration of the Board is designed to attract and retain an optimal Board structure in a competitive environment. The directors' compensation is recommended by the nomination committee and determined by the shareholders at the annual general meeting each year. The Board's remuneration shall reflect the Board's responsibility, expertise, use of time and the complexity of the Company's business activities. Remuneration shall not be dependent on or linked to the Company's performance.
If any Board member has received remuneration above the standard Board member fee, this shall be specified in the annual report.
Deviation from the Code of Practice: the Company has granted options to the Board in 2021.
Executives renumeration
The Company has prepared a policy for determining remuneration to the chief executive officer and other executive members in accordance with Section 6-16a of the NPLLCA, which is clear and easily understandable. The policy shall always support the prevailing strategy, long-term interests, financial sustainability and values of the Company.
The total remuneration to the chief executive officer and other executive members consists of basic salary (main element), benefits in kind, variable salary, pension and insurance schemes.
Performance-related remuneration to the executive members in the form of share options, bonus programs or similar shall be linked to value creation for shareholders or the Company's profit over time. Such arrangements, including warrants and share option arrangements, shall incentivize performance, and be based on quantifiable factors that the executive member in question may influence. Such performance-related remuneration will ordinarily be subject to an absolute limit.
The Board prepares a policy for the remuneration of executive members. This policy includes the main principles for the Company's remuneration policy and contributes to aligning the interests of the shareholders and the executive members. These policies are communicated to the annual general meeting, and it is clearly stated which aspects of the policies are advisory and which, if any, are binding. The general meeting shall vote separately on each of these aspects of the policy.
Information and communication
Aquila's investor relations policy is designed to inform the stock market and stakeholders of the Company's activities and status in a timely and accurate manner in compliance with applicable listing rules. The Company submits quarterly and annual financial reports to Euronext Expand Oslo. In addition, any interim information significant for assessing the Company's value is distributed as stock exchange announcements through Newsweb. This information is also available on the Company's website.
The Company uses the Code of Practice for reporting of investor relations issued by Oslo Stock Exchange and the Norwegian Investor Relations Association as guideline for reporting. Announcements are published in English only, and the Company has been granted exemption from the Norwegian Tax Authority to publish its annual report in English only.
The Company's quarterly earnings presentations are made available on the Company's website.
The financial calendar setting out the dates for the coming year's interim reports and annual general meeting for shareholders is posted on the Aquila website.
Takeovers
Although it is recommended by the Code of Practice, the Board has not established separate policy on how to respond in the event of a take-over bid, but will comply with the following principles should such event occur:
In the event of a takeover bid, the Board will ensure that.
- a. Shareholders in the Company are treated equally.
- b. Shareholders are given sufficient information and time to form a view of the offer.
- c. The Group's business activities are not disrupted unnecessarily.
- d. The bid is not hindered or obstructed by the Board unless there are reasons to do that.
- e. In case the bid is made for the Company's shares, no authorizations or resolutions are exercised or made by the Board with the intention to obstruct the take-over bid unless this is approved by the general meeting after the announcement of the bid.
With respect to any agreements entered by the Company and a bidder, the following principles shall apply:
- a. An agreement limiting the Company's ability to arrange other bids for the Company's shares shall only be entered into if it is self-evident that such an agreement is in the Company and the shareholders' common interest. This shall also apply to any agreement on financial compensation to the bidder if the bid does not proceed.
- b. An agreement that is material to the market's evaluation of the bid shall be disclosed no later than at the same time as the announcement that the bid will be made is published.
c. Any transaction that de facto is a disposal of the Company's activities shall be decided by the general meeting.
If an offer is made for the Company's shares, the Board shall issue a statement recommending its shareholders to accept or decline the offer. The Board's statement shall make it clear whether the views expressed are unanimous, and if such is not the case, explain the basis on which specific members of the Board have excluded themselves from the statement. The Board shall ensure that an explained valuation of the offer is prepared by an independent expert, which shall be disclosed no later than at the time of the disclosure of the Board's statement.
Auditor
The Board has determined the procedure for the external auditor's regular reporting to the Board. The auditor attends at least one meeting each year with the Board in executive session where the Company's management is not represented. In addition, the auditor participates in the meetings of the audit committee relating to the preliminary annual financial statements. If there are any significant changes from the preliminary accounts, the auditor may also participate in the meeting that approves the annual financial statements.
The Company's external auditor presents to the audit committee the primary features of the plan for the execution of the audit, and reports on the key accounting principles and estimates and the results of the audit to the audit committee and the Board. The auditor also presents any internal control weaknesses and improvement opportunities to the audit committee and the Board.
The Board reports the remuneration paid to the auditor at the annual general meeting, including details of the fees paid for audit work and any fees paid for other assignments. The audit fee is determined by the annual general meeting.
The auditor is required to attend a general meeting if the business to be transacted is of such nature that his or her attendance must be considered necessary. In addition, the auditor is in any case entitled to participate in the general meeting.
In accordance with applicable accounting regulations, the Company is required to tender its audit services each ten years. The Company is required to rotate its auditor after twenty years with the same audit firm.
4. Consolidated financial statement
Consolidated statement of comprehensive income
| USD thousands | Note | 2024 | 2023 |
|---|---|---|---|
| Revenue | 3,4 | 3 914 | 8 237 |
| Changes in fair value of investments (loss) | 3,9 | (1 779) | (251) |
| Other gains (losses) | 3,4 | (730) | (1 000) |
| Cost of sales | 5 | (3 942) | (5 791) |
| Selling, general and administrative expenses | 3,18 | (1 992) | (2 472) |
| Reversal of other accruals | 3 | 1 323 | - |
| Amortization multi-client | 6 | (6 409) | (6 409) |
| Impairment multi-client | 6 | (2 646) | - |
| Operating profit (loss) (EBIT) | (12 261) | (7 686) | |
| Financial income | 7 | 69 | 25 |
| Financial expenses | 7 | (143) | (394) |
| Currency exchange gain (loss) | 7 | 106 | (39) |
| Profit (loss) before tax | (12 228) | (8 093) | |
| Income tax (expense) | 8 | 1 506 | 7 |
| Profit (loss) for the period | (10 722) | (8 087) | |
| Currency translation adjustments Other comprehensive income (loss) for the period |
- - |
- - |
|
| Total comprehensive income (loss) for the | |||
| period | (10 722) | (8 087) | |
| Earnings (loss) per share | |||
| Basic earnings per average share | 22 | (0.05) | (0.04) |
| Diluted earnings per average share | 22 | (0.05) | (0.04) |
Consolidated statement of financial position
| USD thousands | Note | 31.12.2024 | 31.12.2023 |
|---|---|---|---|
| Assets | |||
| Non-current assets | |||
| Multi-client library | 6 | 22 027 | 31 082 |
| Investments | 9 | 4 307 | 6 570 |
| Financial assets | 4 | 1 299 | 2 029 |
| Total non-current assets | 27 634 | 39 682 | |
| Current assets | |||
| Trade receivables | - | 896 | |
| Other current assets | 10 | 77 | 1 265 |
| Bank deposits, cash in hand | 11 | 1 054 | 2 038 |
| Total current assets | 1 131 | 4 200 | |
| Total assets | 28 764 | 43 882 | |
| USD thousands | Note | 31.12.2024 | 31.12.2023 |
| Equity and Liabilities | |||
| Equity | |||
| Share capital and other paid in capital | 12 | 79 433 | 79 909 |
| Own shares | 12 | (1 775) | (1 799) |
| Other reserves | 12 | (50 629) | (39 991) |
| Total equity | 27 029 | 38 120 | |
| Current liabilities | |||
| Trade payables | 13 | 32 | 545 |
| Taxes payables | 776 | 2 282 | |
| Other current liabilities | 14 | 928 | 2 935 |
| Total current liabilities | 1 735 | 5 762 | |
| Total liabilities | 1 735 | 5 762 | |
| Total equity and liabilities | 28 764 | 43 882 |
Oslo, 3 April 2025
The Board of Directors and CEO of Aquila Holdings ASA
Chair Director Director
Nina Skage Ketil Skorstad Torstein Sanness
Kristian Zahl Interim CEO
Consolidated statement of change in equity
| USD thousands | Share capital |
Additional paid-in capital |
Own shares |
Accumulated earnings |
Other equity/ Share based program |
Total equity |
|---|---|---|---|---|---|---|
| Balance as of 01.01.2024 | 28 739 | 51 170 | (1 799) | (40 415) | 425 | 38 120 |
| Profit (loss) for the period Other comprehensive income (loss) |
(10 722) - |
(10 722) - |
||||
| Purchase own shares | (453) | 84 | (370) | |||
| Delete own shares | (477) | 477 | ||||
| Share based payment | - | - | ||||
| Balance as of 31.12.2024 | 28 263 | 51 170 | (1 775) | (51 053) | 425 | 27 029 |
| USD thousands | Share capital |
Additional paid-in capital |
Own shares |
Accumulated earnings |
Other equity/ Share based program |
Total equity |
| Balance as of 01.01.2023 | 28 739 | 51 170 | (489) | (32 191) | 422 | 47 652 |
| Profit (loss) for the period Other comprehensive income (loss) |
(8 087) - |
(8 087) - |
||||
| Purchase own shares | (1 310) | (138) | (1 448) | |||
| Share based payment | 3 | 3 | ||||
| Balance as of 31.12.2023 | 28 739 | 51 170 | (1 799) | (40 415) | 425 | 38 120 |
Consolidated statement of cash flow
| USD thousands | Note | 2024 | 2023 |
|---|---|---|---|
| Cash flow from operating activities | |||
| Profit (loss) before tax | (12 228) | (8 093) | |
| Taxes refund (paid) | 0 | 7 | |
| Amortization and impairment | 6 | 9 055 | 6 409 |
| Changes in fair value of investments | 9 | 1 779 | 251 |
| Changes in other gains (losses) without cash flow effect | 4 | 730 | 1 000 |
| Other working capital changes | (178) | 1 728 | |
| Net cash from operating activities | (842) | 1 302 | |
| Cash flow from investing activities | |||
| Cash received/paid from investments | 485 | - | |
| Net cash flow from investment activities | 485 | - | |
| Cash flow from financing activities | |||
| Investment in own shares | 12 | (370) | (1 448) |
| Interest paid | (258) | (13) | |
| Net cash flow from financial activities | (627) | (1 461) | |
| Net change in cash and cash equivalents | (985) | (159) | |
| Cash and cash equivalents balance 01.10/01.01 | 2 038 | 2 197 | |
| Cash and cash equivalents balance 31.12 | 11 | 1 054 | 2 038 |
Note 1 Basis for presentation
The consolidated financial statements are prepared in accordance with IFRS® Accounting Standards as adopted by the EU, their interpretations adopted by the International Accounting Standards Board ("IASB") and the additional requirements of the Norwegian Accounting Act as of 31 December 2021.
The separate financial statements for the parent company have been prepared and presented in accordance with simplified IFRS as approved by Ministry of Finance 10 December 2019. In the separate statements the exception from IFRS for recognition of dividends and group contributions is applies. Otherwise, the explanations of the accounting policy for the group also apply to the separate statement, and the notes to the consolidate financial statements will to a large degree also cover the separate statements. Aquila also provides additional disclosures in accordance with requirements in the Norwegian Accounting Act related to remuneration to the board and the senior management.
The notes are an integral part of the consolidated financial statements.
The consolidated financial statements have been prepared on a historical cost basis, except for certain financial assets financial instruments that have been measured at fair value. The financial statements of the subsidiaries have been prepared for the same reporting year as the Company, using consistent accounting policies.
The consolidated financial statements provide comparative information in respect of the previous period and are presented in thousands of USD.
The income statement is presented by showing expenses by their nature. The statement of cash flows is presented using the indirect method.
The consolidated financial statements of the Group were authorized by the Board of Directors on 3 April 2025. The consolidated financial statements will be presented for approval at the annual general meeting on 22 May 2025. Until this date, the Board of Directors has the authority to amend the financial statements.
The annual financial statements have been prepared under a going concern assumption. These assumptions rest on financial forecasts and plans for the coming period and plans for coming years based on the assumptions made about future events and planned transactions.
Note 2 Key accounting estimates and assumptions.
The preparation of the group's consolidated financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, the accompanying disclosures and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.
In the process of applying the group's accounting policies, management has made various judgements. Those which management has assessed to have the most significant effect on the amounts recognized in the consolidated financial statements have been discussed in the individual notes of the related financial statement line items.
The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, which have a significant risk of causing material adjustments to the carrying amounts of assets and liabilities within the next financial year, are described in the individual notes to the related financial statement line below. The Group based its assumptions and estimated parameters available when the consolidated financial statements were prepared. Existing circumstances and assumptions about future development, however, may change due to market changes or circumstances arising that are beyond the control of the Group. Such changes are reflected in the assumptions when they occur.
Fair value measurement
Certain financial instruments are measured at fair value. Aquila uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs. All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy based on the lowest level of input that is significant to the fair value measurement, and can be described as follows:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices). Level 3: Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs).
In note number 9 the value measurement of financial instruments is categorized using the above description.
Impairment of intangible assets
The Group uses the discounted cash flow method to estimate the present value of the multiclient library, project Utsira including the reprocessing and project Egypt, based on expectations of future multi-client late sales according to the cash flow prognosis used by management for 2024.
There are two uncertainties when it comes to the timing of the late sales and also the size of the late sales. The management has weighted these uncertainly with probability in their discounted cash flow calculations. The WACC used in the calculation is comparable to peers.
Note 3 Segment reporting
The Group operates two segments, Axxis and Investments, based on the two different revenue streams. The Group has a legacy seismic business operating under the name Axxis Geo Solutions, with a multi-client data library. The investment segment was new from 2021. The Group has a strategy to invest in listed companies as well as companies expected to be listed in the near term. Investments must meet the criteria for risk and return set by the board of directors.
The segment reporting is based on the same accounting principles as the financial statements.
Operating expenses are allocated to the segments based on the use of resources and assets. Unallocated items include revenue and expenses related to salaries for office personnel and other office expenses.
Share based payment cost and capitalized cost of obtaining contracts has not been allocated to segments.
| USD thousands | Segment reporting | Unallocated | Total | |
|---|---|---|---|---|
| Axxis | Investment | |||
| Income statement | 2024 | 2024 | 2024 | 2024 |
| Total revenue | 3 914 | - | - | 3 914 |
| Changes in fair value of investments | - | (1 779) | - | (1 779) |
| Other gains (losses) | (730) | - | - | (730) |
| Cost of sales | (3 942) | - | - | (3 942) |
| Selling, general and administrative | ||||
| expenses | (199) | (5) | (1 788) | (1 992) |
| Reversal of other accruals | 1 323 | - | - | 1 323 |
| Amortization multi-client | (6 409) | - | - | (6 409) |
| Impairment multi-client | (2 646) | - | - | (2 646) |
| Operating profit (loss) (EBIT) Segment | (8 689) | (1 784) | (1 788) | (12 261) |
| USD thousands | Segment reporting | Total | ||
|---|---|---|---|---|
| Axxis | Investment | |||
| Geographical markets | 2024 | 2024 | 2024 | 2024 |
| Norway | 3 914 | - | - | 3 914 |
| Total revenue | 3 914 | - | - | 3 914 |
| USD thousands | Segment reporting | Total | ||
|---|---|---|---|---|
| Axxis | Investment | |||
| Major customers | 2024 | 2024 | 2024 | 2024 |
| Customer 1 | 1 430 | - | - | 1 430 |
| Customer 2 | 1 430 | - | - | 1 430 |
| Customer 3 | 949 | - | - | 949 |
| Customer 4 | 105 | - | - | 105 |
| Total revenue | 3 914 | - | - | 3 914 |
| USD thousands | Segment reporting | Unallocated | Total | |
|---|---|---|---|---|
| Axxis | Investment | |||
| Income statement | 2023 | 2023 | 2023 | 2023 |
| Total revenue | 8 237 | - | - | 8 237 |
| Changes in fair value of investments | - | (251) | - | (251) |
| Other gains (losses) | (1 000) | (1 000) | ||
| Cost of sales | (5 791) | - | - | (5 791) |
| Selling, general and administrative | ||||
| expenses | (1 034) | (8) | (1 430) | (2 472) |
| Amortization multi-client | (6 409) | - | - | (6 409) |
| Operating profit (loss) (EBIT) Segment | (5 997) | (259) | (1 430) | (7 686) |
The geographical split is based on where the late sales occur.
| USD thousands | Segment reporting | Unallocated | Total | |
|---|---|---|---|---|
| Axxis | Investment | |||
| Geographical markets | 2023 | 2023 | 2023 | 2023 |
| Norway | 8 237 | - | - | 8 237 |
| Total revenue | 8 237 | - | - | 8 237 |
| USD thousands | Segment reporting | Unallocated | Total | |
|---|---|---|---|---|
| Axxis | Investment | |||
| Major customers | 2023 | 2023 | 2023 | 2023 |
| Customer 1 | 3 720 | - | - | 3 720 |
| Customer 2 | 3 720 | - | - | 3 720 |
| Customer 3 | 458 | - | - | 458 |
| Customer 4 | 340 | - | - | 340 |
| Total revenue | 8 237 | - | - | 8 237 |
Note 4 Revenue and cost from contract with clients
Revenue from contracts with customers is recognized when control of the goods or services is transferred to the customer at an amount which reflects the considerations to which the Group expects to be entitled in exchange for those goods or services.
Pre-funding
Multi-client pre-funding contracts of unfinished data (i.e. contracts entered into prior to being ready for delivery) are considered to be 'right to use licenses' under IFRS 15, meaning that all revenues related to these contracts is recognized at the point in time when the license is transferred to the customer, which would typically be upon completion of processing of the survey and granting of access to the finished survey or delivery of the finished data, independent of services delivered to clients during the project phase. Aquila has generally concluded that it is the principal in its revenue arrangements because it typically controls the goods or services before transferring them to the customer.
Late sales
Revenue for sale of finished data is recognized at a point in time, generally upon delivery of the processed data (i.e. the client has gained access to the data under a binding agreement). Through the binding agreement the customer is granted a non-exclusive license to use the finished data. Sales of finished data are presented as part of late sales revenue together with sales of unfinished data in cases where the relevant survey had already commenced when the contract was entered into.
| USD thousands | Axxis | Investment | Total |
|---|---|---|---|
| Income statement | 2024 | 2024 | 2024 |
| Multi-client projects late sales | 1 054 | 1 054 | |
| Multi-client projects pre-funding | 2 860 | 2 860 | |
| Total revenue from contracts with customers | 3 914 | 3 914 | |
| At a point in time | 3 914 | 3 914 | |
| Total revenues from contracts with customers | 3 914 | 3 914 | |
| USD thousands | Axxis | Investment | Total |
| Other gains (losses) | 2024 | 2024 | 2024 |
| Sale of node assets - earnout model | (730) | (730) | |
| Total gain (losses) | (730) | (730) |
| USD thousands | Axxis | Investment | Total |
|---|---|---|---|
| Income statement | 2023 | 2023 | 2023 |
| Multi-client projects late sales | 797 | 797 | |
| Multi-client projects pre-funding | 7 440 | 7 440 | |
| Total revenue from contracts with customers | 8 237 | 8 237 | |
| At a point in time | 8 237 | 8 237 | |
| Total revenues from contracts with customers | 8 237 | 8 237 | |
| USD thousands | Axxis | Investment | Total |
| Other gains (losses) | 2023 | 2023 | 2023 |
| Sale of node assets - earnout model | (1 000) | (1 000) | |
| Total gain (losses) | (1 000) | (1 000) |
The ocean-bottom seismic contract node on a rope business was divested in March 2022, through an earnout agreement with Magseis Fairfield. Under the agreement, Aquila received USD 0.5 million at closing and to further to receive earnout payments of up to a maximum of USD 12.0 million over the next three years, based on the use of the equipment. The minimum payment after year three is USD 1.5 million.
Due to the short remaining earn-out period a USD 0.7 million reduction in the fair value of the financial asset has been recognized in 2024. In 2023 a reduction of USD 1.0 million was recognized.
Note 5 Cost of sales
Cost of sales (COS) consists of direct costs related to proprietary contract work and other services revenue in which revenue is recognized over time. COS also consists of costs related to delivery of geoscientific data.
USD thousands
| Cost of sales | 2024 | 2023 |
|---|---|---|
| Reprocessing | (3 944) | (5 744) |
| Agent related expenses | (8) | (48) |
| Reversal of cost previous period | 10 | - |
| Total cost of sales | (3 942) | (5 792) |
Note 6 Multi-client library
The multi-client library consists of geophysical data to be licensed to customers on a nonexclusive basis. Directly attributable costs associated with the production and development of multi-client projects such as data acquisition and processing, and direct project costs are capitalized. Cost directly attributable to data acquisition and processing include vessel costs, payroll and related costs for crew, project management, agent, other related project costs, hardware/software costs and mobilization costs when relocating a vessel to the survey areas. The library of multi-client seismic data and interpretations is presented at cost reduced by accumulated amortization and impairment.
Straight-line amortization
After a project is completed, a straight -line amortization is applied. The straight-line amortization is assigned over the remaining useful life. Each project is evaluated individually for a lifetime and the estimates are revised at least annually.
Accelerated amortization of seismic data
No amortization is recognized until the point in time when the license is transferred to the customer, which would typically be upon completion of processing of the survey and granting of access to the finished survey or delivery of the finished data. When a project is completed and after pre-funding is recognized, recognition of accelerated amortization may be necessary in the event the recoverable value (present value of expected late sales) is lower than net book value of the survey (capitalized cost of the survey).
Following the adoption of the straight-line amortization policy for completed surveys, recognition of accelerated amortization of a library may be necessary if sales on a survey is realized disproportionately sooner within that survey's useful life.
Impairment evaluation multi-client library
Before the library is completed, the Group tests for impairment at least annually. To ensure that value in use is above net book value, the Group will perform an additional impairment test after each significant sale is recognized, as each customer will only acquire the full dataset once. Any impairment of the multi-client library is recognized immediately and presented as 'Impairment of the multi-client library' in the statement of profit and loss.
According to IFRS the multi-client library should be tested for impairment if the circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs of disposal and value in use.
| USD thousands | 31.12.2024 | 31.12.2023 |
|---|---|---|
| Cost as of 01.01 Additions |
92 881 - |
92 881 - |
| Cost as of 31.12 | 92 881 | 92 881 |
| Accumulated amortization and impairment as of 01.01 | (61 799) | (55 390) |
| Amortization for the period | (6 409) | (6 409) |
| Impairment | (2 646) | - |
| Accumulated amortization and impairment as of | ||
| 31.12 | (70 854) | (61 799) |
| Carrying value at 01.01 | 31 082 | 37 491 |
| Carrying value at 31.12 | 22 027 | 31 082 |
In December 2022, a reprocessing agreement for the Utsira project was signed with Viridien (formerly CGG), supported by pre-funding from two major oil companies, adding a new multiclient asset to the balance sheet. The new asset was added to the balance sheet through a reversal of a previous impairment of the Utsira OBN library.
The value in use of an asset reflects the expected future cash flows it will generate in its current condition, discounted to present value using an appropriate rate. Quarterly impairment testing for multi-client assets employs a discounted cash flow (DCF) model, incorporating multiple sales value scenarios weighted by their likelihood of materializing over time. These scenarios form the basis of the sales forecast pipeline going into the DCF, tracked with conservative estimates to reflect development trends. While the unpredictable timing and value of sales in the multi-client business can pose challenges due to its lumpy nature, historical data shows that most projected sales leads have eventually materialized. The discount rates applied in the DCF impairment tests set at a WACC of 10.10% for Norwegian assets and 12.44% for Egyptian assets.
The Group's Egyptian multi-client rights in the Suez are capped at USD 13.7 million with no timebased expiry beyond this limit. In Norway, the Utsira OBN survey carries a 10-year exclusivity period from processing completion, meaning the original data becomes public domain in late 2030, while the reprocessed data follows in 2034.
The multi-client segment comprises several seismic data surveys, each treated as a distinct cash-generating unit (CGU) and tested separately for impairment. As of December 31, 2024, the Group holds two such surveys. The Utsira survey began amortization in Q3 2020, when processed data was first available to customers, initially over a 4-year lifespan. In January 2022, this was extended to 10 years, leaving 8.5 years remaining as of that date. The Egyptian survey completed processing in September 2022, with amortization commencing in Q3 2022 over a 4 year term.
The announcement of the APA-2024 licensing round on the Norwegian Continental Shelf in January 2025 awarded several new licenses in the Utsira survey area, primarily to AkerBP and Equinor without additional partners. This reduced the pool of prospective clients, triggering a USD 2.6 million impairment charge in Q4 2024. The updated balance of the Utsira survey after impairment is USD 18.1 million.
The impairment test is sensitive to changes in the Weighted Average Cost of Capital (WACC), with a 1% shift altering the result by approximately USD 220,000. It is also influenced by uncertainties around sales values and the timing of sales. Management based the forecast on budgets and assumptions about future market demand and spending on exploration and production by oil companies, including licensing activities, M&A related transfer fees and farmins. The uncertainty tied to timing plays a significant role. Impairment may occur if a sales opportunity is dropped from the list of likely outcomes or its probability is notably reduced, depending on how critical that sale was to the projections; however, the addition of new sales leads into the model could offset such losses by bolstering projected revenues. Historically, sales amounts have outpaced modeled estimates but have happened later than expected.
The Group assesses that climate risk does not materially affect the multi-client asset valuations as of December 2024.
Note 7 Financial items
USD thousands
| Financial income | 2024 | 2023 |
|---|---|---|
| Interest income | 69 | 25 |
| Other financial income | - | - |
| Total financial income | 69 | 25 |
| Financial expenses | 2024 | 2023 |
| Interest expense | (130) | (286) |
| Other financial expenses | (12) | (108) |
| Total financial expenses | (143) | (394) |
| Currency exchange gain (loss) | 2024 | 2023 |
| Exchange gains | 657 | 402 |
| Exchange losses | (551) | (441) |
| Total exchange gain (loss) | 106 | (39) |
Note 8 Tax
Tax (income) in 2024 was USD 1 506 thousand compared with USD 7 thousand tax (income) in 2023.
Current income tax
Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted at the reporting date in the countries where the Aquila operates and generates taxable income.
| USD thousands | ||
|---|---|---|
| 2024 | 2023 | |
| Specification of tax expense (income) for the year | ||
| Current income tax (including withholding tax) | - | - |
| Change in deferred tax | - | - |
| Changes from previous years | (1 506) | (7) |
| Total tax expense (income) | (1 506) | (7) |
| Reconciliation of actual against expected tax | ||
| expense (income) at the income tax rate of 22% | ||
| (8 | ||
| Profit (loss) before tax | (12 228) | 093) |
| 22% tax | (2 690) |
(1 781) |
| Tax effect from: | ||
| Withholding tax and corporate tax abroad | - | - |
| Permanent differences | 99 | 98 |
| Currency effect | (1 036) | 590 |
| Difference in tax rate in foreign activities | - | - |
| Changes from previous years | 1 506 | 584 |
| Not booked deferred tax asset | 615 | 501 |
| Calculated tax expense (income) | (1 506) | (7) |
| Effective tax rate for the Company | 12.32 | 0.09 |
| USD thousands | 31.12.2024 | 31.12.2023 |
| Temporary differences | ||
| Non current assets | (3 548) | (4 945) |
| Accumulated loss carried forward | (50 212) | (44 837) |
| Temporary differences at 31.12. | (53 760) | (49 782) |
| Deferred tax assets (liabilities) | 11 827 | 10 952 |
Withholding taxes
Withholding taxes are included in the tax expense to the extent that a tax credit is available in the income tax in the home state. Changes from previous year is related to change in accrual for corporate income tax in Egypt, where the taxes have not been settled.
Deferred taxes
The deferred tax liabilities or tax assets are recognized in the 2024 financial statement. The Group has substantial tax losses carried forward. All the tax losses carried forward are related to the Norwegian entities. However, no deferred tax assets have been recognized due to the uncertainties in being able to utilize the tax losses.
Note 9 Financial assets
The Group invests in financial assets as part of its core business. The financial investments are reflected at fair value and value adjustments are posted in the profit or loss statement.
Financial assets are measured at fair value using fair value hierarchy described in accounting principles.
USD thousands
| Number of | |||
|---|---|---|---|
| Investments | shares | 31.12.2024 | 31.12.2023 |
| Listed securities | |||
| Capsol Tehnologies ASA | 4 033 188 | 3 909 | 4 824 |
| Dolphin Drilling AS | - | - | 1 427 |
| Listed securities | 3 909 | 6 250 | |
| Unlisted securities | |||
| Arbaflame AS | 3 920 294 | 397 | 320 |
| Unlisted securities | 397 | 320 | |
| Total investments | 4 307 | 6 570 |
| USD thousands | |||
|---|---|---|---|
| Pricing sensitivity | Gain/(loss) | Gain/(loss) | |
| Investments | 31.12.2024 | of 5% movement | of 10% movement |
| Capsol Technologies ASA | 3 909 | 195 | 391 |
| Dolphin Drilling AS | 0 | 0 | 0 |
| Arbaflame AS | 397 | 20 | 40 |
| Total Investments | 4 307 | 215 | 431 |
Capsol Technologies ASA
The investment in Capsol Technologies is valued based on Level 1 inputs, quoted prices in active markets. Year-end closing price was NOK 11.00 (NOK 13.50 in 2023) per share.
The valuation of traded shares is based on quoted prices in active markets. Market price changes after year end may have a significant impact on the overall fair value of investments.
Dolphin Drilling AS
The Group disposed of all shares in Dolphin Drilling AS in 2024.
Arbaflame AS
The investment in Arbaflame is measured based on level 3 inputs. The company is not listed, and management has therefore evaluated all available information and news from the company after the investment was made. In December 2024 the Group received a sales offer for the shares in Arbaflame at NOK 1.15 per share. The offer was accepted, and the Group use this value. Based on this valuation, the estimated fair value of the Group's investment in Arbaflame was USD 0.4 million (NOK 4.5 million) at the end of December 2024. Settlement for the shares was received in 2025 as the shares were transferred to the buyer.
The Group does not consider climate risk to have a significant impact on the estimates for the fair value of investments per December 2024.
Note 10 Other current assets
| USD thousands | 31.12.2024 | 31.12.2023 |
|---|---|---|
| Prepayments | 77 | 122 |
| Accrued income | - | 1 140 |
| Other current receivables | - | 3 |
| Total other current assets | 77 | 1 265 |
Note 11 Bank deposits, cash in hand
Cash and cash equivalents in the balance sheet include cash in bank accounts and on hand and short deposits with banks with an original maturity of three months or less.
| USD thousands | 31.12.2024 | 31.12.2023 |
|---|---|---|
| Bank deposits | 1 019 | 2 009 |
| Restricted bank deposits | 34 | 29 |
| Total bank deposits | 1 054 | 2 038 |
Restricted bank deposits relate to employee withholding tax. These deposits are subject to regulatory restrictions and are therefore not available for general use by the entities within the Group. The account can be used to settle employee withholding tax.
Note 12 Share capital and shareholder information
| The Company's share capital per 31.12.2024 include the following: |
Number of shares |
Share Capital in NOK |
Par Value per share |
|---|---|---|---|
| Ordinary shares (one share = one vote) |
234 690 967 | 234 690 967 | 1.00 |
The Company has one class of shares, all shares provide equal rights, including the right to any dividends in line with 2023. Each of the shares carries one vote in line with 2023.
Aquila Holdings ASA has in 2024 purchased 4 827 843 own shares at USD 0.4 million. In 2023, 13 885 011 own shares were purchased at USD 1.4 million. In 2024 5 069 150 shares were deleted. The subsidiaries directly or indirectly do not own shares, or treasury shares in the Company.
| Changes in number of shares | Shares |
|---|---|
| Number of shares 01.01.2024 | 239 760 117 |
| Own shares 31.12.2024 | 18 906 861 |
| Number of shares 31.12.2024 | 220 853 256 |
Paid/proposed dividend
The board has decided not to propose any dividend for 2024.
The major shareholders in Aquila Holdings ASA 31 December 2024 were as follows:
| Ownership | |||
|---|---|---|---|
| Shareholders | Total shares | share | Voting share |
| INVESTERINGSFONDET VIKING AS | 23 717 632 | 10.1% | 10.1% |
| F2 FUNDS AS | 20 543 300 | 8.8% | 8.8% |
| AQUILA HOLDINGS ASA | 18 906 861 | 8.1% | 8.1% |
| TIGERSTADEN AS | 16 250 000 | 6.9% | 6.9% |
| ALDEN AS | 11 265 384 | 4.8% | 4.8% |
| F1 FUNDS AS | 10 456 424 | 4.5% | 4.5% |
| DNB BANK ASA | 9 300 000 | 4.0% | 4.0% |
| SIX SIS AG | 7 990 000 | 3.4% | 3.4% |
| GINNY INVEST AS | 7 750 230 | 3.3% | 3.3% |
| URTIVEN AS | 6 400 000 | 2.7% | 2.7% |
| BALLISTA AS | 6 323 231 | 2.7% | 2.7% |
| Em Kapital As | 6 316 846 | 2.7% | 2.7% |
| PHILIP HOLDING AS | 5 750 230 | 2.5% | 2.5% |
| KING KONG INVEST AS | 4 850 000 | 2.1% | 2.1% |
| LIVERMORE INVEST AS | 4 693 060 | 2.0% | 2.0% |
| Johansson | 4 337 291 | 1.8% | 1.8% |
| TTC INVEST AS | 4 000 000 | 1.7% | 1.7% |
| Nordnet Bank AB | 3 071 166 | 1.3% | 1.3% |
| HMH INVEST AS | 2 617 958 | 1.1% | 1.1% |
| Q CAPITAL AS | 2 572 615 | 1.1% | 1.1% |
| Total 20 largest shareholders | 177 112 228 | 75.5% | 75.5% |
| Total other shareholders | 57 578 739 | 24.5% | 24.5% |
| Total number of shares | 234 690 967 | 100.0% | 100.0% |
Shares owned or controlled by members of the Board of Directors, chief executive officer and other executive officers 31 December 2024 were as follows:
| Ownership | Number of |
||||
|---|---|---|---|---|---|
| Board of Directors | Position | Total shares | share Voting share | options | |
| Nina Skage | Chair | 41 942 | 0.0 % | 0.0 % | - |
| Torstein Sanness | Board member | 285 000 | 0.1 % | 0.0 % | 800 000 |
Share and options owned by management 31 December 2024 were as follows:
| Executive management | Position | Number of shares |
Number of options |
|---|---|---|---|
| Kristian Zahl | Interim CEO | 1 667 | - |
Note 13 Categories of financial instruments
The Group's exposure to various risks associated with financial instruments is discussed in note 12 Financial risk management. The maximum exposure to credit risk at the end of the reporting period is the carrying amount of each class of financial assets mentioned above.
USD thousands
| ASSETS | 31.12.2024 | 31.12.2023 |
|---|---|---|
| Financial assets at amortized cost | ||
| Bank deposits, cash in hand | 1 054 | 2 038 |
| Financial assets at fair value through profit and loss | ||
| Investments | 4 307 | 6 570 |
| Financial assets | 1 299 | 2 029 |
| Total financial assets | 6 660 | 10 638 |
| LIABILITIES | 31.12.2024 | 31.12.2023 |
| Financial liabilities at amortized cost | ||
| Trade payables | 32 | 545 |
| Other current liabilities | 928 | 2 935 |
| Total financial liabilities | 960 | 3 480 |
Fair value
Due to the short-term nature of bank deposits, cash in hand, trade receivables and other current receivables, their carrying amount is considered to be the same as their fair value.
See note 9 for investments for more information.
Fair value for financial assets is measured based on level 3 inputs. See note 4 for more information.
Note 14 Other current liabilities
| USD thousands | 31.12.2024 | 31.12.2023 |
|---|---|---|
| Holiday pay owed | 49 | 65 |
| Egyptian tax * | 538 | 2 077 |
| Other accrued costs | 434 | 836 |
| VAT settlement | (93) | (43) |
| Total other current liabilities | 928 | 2 935 |
* These taxes payables are related to Egyptian taxes for withholding and crew related tax originally in EGP. Due to currency exchange development in Egypt EGP vs USD, the amount in USD is reduced compared to 2023.
Note 15 Financial risk management
Aquila has various financial assets. These are primarily held in USD: The group's principal financial liabilities comprise trade payables and other current liabilities. Aquila does not hold any currency or interest swaps.
Capital management
For the Group's capital management, capital includes issued capital, share premium and all other equity reserves attributable to the equity holders of the parent.
The Group manages its capital structure and adjusts considering changes in economic conditions. To maintain or adjust the capital structure, the Group may return capital to shareholders, issue new shares, repay or issue new debt.
The Group's capital management, among other things, aims to ensure that it fulfils if any borrowings that define capital structure requirements. Any breaches in meeting the financial terms if any would permit the borrower to immediately call borrowings.
Market risk – price risk
For information regarding market risk – price risk see note 9.
Credit risk
All placements of excess cash are bank deposits. Aquila is exposed to credit risk through sales and uses best efforts to manage the risk. Aquila considers the concentration of risk with respect to trade receivables as low due to the Group's credit rating policies and as its customers are large oil and gas companies considered to be financially sound.
All trade receivable was fully paid during 2024 and 2023, and therefore no provision for losses.
Liquidity risk
Liquidity risk arises from lack of correlation between cash flow from operations and financial commitments. Per the balance sheet date, Aquila held current assets of USD 1 131 thousand, of which cash and cash equivalents represented USD 1 054 thousand and other current assets represent USD 77 thousand. In addition, the group's financial assets represent USD 1 299 thousand. In comparison, current liabilities amounted to USD 1 735 thousand.
The table below provides an overview of the maturity profile of all financial liabilities. For bank loans the stated amount includes estimated interest payments. In cases where the counterpart may claim earlier redemption, the amount is places in the earliest period and the payment may be required from the counterparty.
| Remaining Term | ||||||
|---|---|---|---|---|---|---|
| USD thousands | 0-3 months |
3-6 months |
6-9 months |
9-12 months |
1-2 years | Total |
| Trade payables | 32 | - | - | - | - | 32 |
| Other current liabilities | 390 | 538 | - | - | - | 928 |
| Total | 422 | 538 | - | - | - | 960 |
Currency risk
Substantial portions of Aquila's revenues and costs are in USD. Due to this, the group's operational exposure to exchange rate fluctuations is low. However, as the parent company pays taxes in Norwegian kroner (NOK) to the Norwegian Tax Authorities, salaries to employees and dividends to shareholders in NOK, fluctuations between the NO and USD impact currency exchange gain or losses in the tax expense and financial items of the consolidated accounts. A reasonably possible strengthening (weakening) of the USD against NOK on 31 December would have affected profit or loss with the following amounts:
| USD thousands | Change in exchange rate USD/NOK |
Effect on profit before tax |
Effect on OCI |
|---|---|---|---|
| 2024 | + 10 % | (248) | - |
| - 10 % | (246) | - | |
| 2023 | + 10 % | (471) | - |
| - 10 % | 576 | - |
The Group also have operations in Egypt. However, currently the activity level is at the minimum and the currency risk is mainly exposed on the tax liabilities to the Egyptian Tax Authorities (which are reflected in the balance sheet).
Note 16 Leases and commitments
Leases
Only office rental comes under the classification of leases. As of 31 December 2024, and 2023, the Group has no lease liabilities. The reason is that the commitment related to office rent can be cancelled with one month's notice.
Commitments
As of December 2024, and 2023, the Group had commitments related to office rent for the Oslo office with one month's notice.
Note 17 Related parties
The ultimate parent of the Group is Aquila Holdings ASA.
The Group transactions and balances with related parties in 2024 and 2023 were related to consultancy fees from companies representing some of the largest shareholders.
| Transactions with related parties | ||
|---|---|---|
| USD thousands | 2024 | 2023 |
| Consultancy services: | ||
| Citadell AS controlled by Fredrik Sneve | 10 | 50 |
| Lighthouse Reef AS controlled by Lars Eriksen | 65 | |
| Middelborg AS controlled by Lars Eriksen | - | 2 |
| Balances with related parties | ||
| USD thousands | 31.12.2024 | 31.12.2023 |
| Account payables / Other current liabilities: | ||
| Lighthouse Reef AS | 6 | - |
As of 20 November 2023, and agreement related to consultancy services was entered with Lighthouse Reef AS representing one of the largest shareholders of the parent company. As of 1st July 2021, an agreement related to consultancy services was entered with Citadell AS and Middelborg AS representing some of the largest shareholders of the parent company, in addition to participate in the nomination committee from 23 June 2021. The agreement to deliver consultancy services with these companies was cancelled by end of January 2023.
Note 18 Personnel expenses and board remunerations
| USD thousands | 2024 | 2023 |
|---|---|---|
| Wages and salaries | 682 | 677 |
| Social Security costs | 108 | 110 |
| Pension costs | 44 | 53 |
| Other remuneration | 301 | 10 |
| Share based payment expense (refer to note 19) | - | 3 |
| Refund salary | (1) | (16) |
| Total personnel expense | 1 134 | 838 |
| Number of man-years at 31.12 | 2024 | 2023 |
| Group companies in Norway | 2.7 | 2.7 |
| Group companies abroad | - | - |
The Group has a defined contribution pension plan. The contribution plan is a retirement plan in which the Group pays fixed contributions to a separate legal entity. The Group has no further payment obligations once these contributions have been paid. Contributions are booked as cost on an ongoing basis. The Group meets the requirements for occupational pension scheme
under the Act on Obligatory Occupational Pensions. The contribution pension scheme in Norway meets the legal requirements.
The Group has not granted any loan or collateral to the Chair of the Board or other related parties.
Key management personnel compensation
| USD thousands | 2024 | 2023 |
|---|---|---|
| Base salary | 254 | 227 |
| Pension | 22 | 18 |
| Other Benefits | 4 | 2 |
| Number of options held | - | - |
For detailed information about executive officers and Board of Directors compensation, see the remuneration report 2024.
See note 12 for shares held by the executive officers and Board of Directors.
Note 19 Share based payments programs
The Group has an option plan for one member of the Board. The fair value of options granted under the plan is recognized as an employee benefit expense with a corresponding increase in equity. The total expense is recognized over the vesting period, which is the period over which all the specified vesting conditions are to be satisfied. At the end of each period, the Group revises its estimates of the number of options that are expected to vest, based on the nonmarket vesting and service conditions. It recognizes the impact of the revision to original estimates, if any, in profit and loss, with a corresponding adjustment to equity
Set out below are summaries of options granted under the scheme:
| 2024 | 2023 | |||
|---|---|---|---|---|
| Average exercise price per share option (NOK) |
Number of options |
Average exercise price per share option (NOK) |
Number of options |
|
| As at 01.01 | 1.8000 | 800 000 | 2.6657 | 802 800 |
| Granted during the year | - | - | - | - |
| Adjusted during the year | - | - | - | - |
| Terminated during the year | - | - | 250.00 | (2 800) |
| As at 31.12 | 1.8000 | 800 000 | 1.8000 | 800 000 |
| Vested 31.12 | 1.8000 | 800 000 | 1.8000 | 800 000 |
| Exercisable 31.12 | 800 000 | 800 000 |
| 2024 | 2023 | |
|---|---|---|
| Share based payment cost (revenue) recognized in the | ||
| period USD thousand | - | 3 |
Share options outstanding at the end of the year have the following expiry date:
| Grant date | Expiry date | Exercise price |
Share options 31 December 2024 |
Share options 31 December 2023 |
|---|---|---|---|---|
| 30.09.2021 | 30.09.2028 | 1.70 | 400 000 | 400 000 |
| 30.09.2021 | 30.09.2028 | 1.90 | 400 000 | 400 000 |
| Total number of options | 800 000 | 800 000 |
| Outstanding instruments overview | |||||
|---|---|---|---|---|---|
| Strike Price | Number of instruments |
Weighted Average remaining contractual life |
Weighted Average Strike Price |
Vested instruments 31.12.2023 |
Weighted Average Strike Price |
| Outstanding instruments Vested instruments |
|||||
| 1.70 | 400 000 | 2.50 | 1.70 | 400 000 | 1.70 |
| 1.90 | 400 000 | 3.50 | 1.90 | 400 000 | 1.90 |
| 800 000 | 800 000 |
The exercise price for the grants was fair value at the grant date. The options can be exercised by buying shares as settlement where one options give right to one share.
Note 20 Auditors fees
| USD thousands | ||
|---|---|---|
| Expensed audit fee (excluding VAT) | 2024 | 2023 |
| Statutory audit | 97 | 133 |
| Tax advice (incl. technical assistance with tax return) | 40 | 54 |
| Other attestation services | 5 | 3 |
| Total auditors fee | 143 | 190 |
The auditor of the Group and the Norwegian entities is PricewaterhouseCoopers (PwC).
Ernst & Young Egypt (EY) is the auditor for the subsidiary Axxis Geo Solutions Egypt LLC.
Note 21 Subsidiaries and associated companies
The Group comprise of the same legal entities as of 31 December 2023.
| Voting rights | ||
|---|---|---|
| Subsidiary of Aquila Holdings ASA: | Jurisdiction | % |
| Neptune Seismic AS | Norway | 100% |
| Axxis Geo Solution Inc. | USA | 100% |
| Axxis Multi Client AS | Norway | 100% |
| Axxis Production AS | Norway | 100% |
| Aquila Holdings Investment AS | Norway | 100% |
| Axxis Geo Solutions Egypt LLC* | Egypt | 100% |
* Axxis Production AS owns 99% and Axxis Geo Solutions ASA owns 1% of the shares in the company.
Note 22 Earnings per shares
Basic earnings per share is calculated by dividing the net profit or loss attributable to shareholders of the parent by the weighted average number of ordinary shares outstanding during the year. Diluted earnings per share include the weighted average number for ordinary shares that would be issued on the conversion of all the diluted potential ordinary shares into ordinary shares. The options described in note 19, are not included in the number of dilutive shares for 2024 or 2023 due to the options is out of money.
| Basic earnings (loss) per weighted average number of | ||
|---|---|---|
| shares | 2024 | 2023 |
| Profit (loss) attributable to the ordinary equity holders of | ||
| the company | (10 722) | (8 087) |
| Average number of outstanding shares | 218 106 335 | 222 215 233 |
| Basic earnings (loss) per weighted average share (USD) | (0.05) | (0.04) |
| Diluted earnings (loss) per share | 2024 | 2023 |
| Profit (loss) attributable to the ordinary equity holders of the company |
(10 722) | (8 087) |
| Average number of outstanding shares | 218 106 335 | 222 215 233 |
Note 23 Events after reporting period
In January 2025 the Group accepted a sales oDžer for the shares in ArbaNJame at NOK 1.15 per share. The oDžer was accepted, and the sale resulted in a seǘlement of USD 0.4 million (NOK 4.5 million). Seǘlement for the sale of the shares was received in January 2025.
In March 2025 the company received settlement of its financial asset related to the sale of ocean bottom node (OBN) equipment to TGS (via Magseis Fairfield), originally concluded in March 2022. As part of the earnout structure agreed upon in the transaction, the company has received the year-three floor payment of USD 1.5 million.
5. Financial statement Aquila Holdings ASA
Statement of comprehensive income
| USD thousands | Note | 2024 | 2023 |
|---|---|---|---|
| Revenue | 1 | - | - |
| Other gains (losses) | 1 | (730) | (1 000) |
| Cost of sales | 2 | 10 | (43) |
| Personnel expenses | 3 | (1 081) | (806) |
| Other operating expenses | (707) | (624) | |
| Write-down intercompany receivable | (6 000) | - | |
| Operating profit (loss) (EBIT) | (8 508) | (2 473) | |
| Financial income | 4 | 26 | 15 |
| Financial expenses | 4 | (2 002) | (100) |
| Currency exchange gain (loss) | 4 | (310) | (214) |
| Profit (loss) before tax | (10 795) | (2 772) | |
| Income tax (expense) | 5 | 0 | 7 |
| Profit (loss) for the period | (10 795) | (2 765) | |
| Currency translation adjustments Other comprehensive income (loss) for the |
- | - | |
| period | - | - | |
| Total comprehensive income (loss) for the period | (10 795) | (2 765) |
Statement of financial position
| USD thousands | |||
|---|---|---|---|
| Assets | Note | 31.12.2024 | 31.12.2023 |
| Non-current assets | |||
| Investment in subsidiaries | 6 | 19 840 | 32 493 |
| Financial assets | 7 | 1 299 | 2 029 |
| Total non-current assets | 21 140 | 34 522 | |
| Current assets | |||
| Receivables from group companies | 8 | 5 672 | 12 133 |
| Other current assets | 9 | 98 | 99 |
| Bank deposits, cash in hand | 7,10 | 753 | 1 486 |
| Total current assets | 6 523 | 13 718 | |
| Total assets | 27 663 | 48 240 | |
| USD thousands | |||
| Equity and Liabilities | Note | 31.12.2024 | 31.12.2023 |
| Equity | |||
| Share capital | 11 | 28 263 | 28 739 |
| Additional paid-in capital | 51 171 | 51 171 | |
| Own shares | (1 775) | (1 799) | |
| Total paid-in capital | 77 658 | 78 111 | |
| Accumulated earnings and other equity | (50 423) | (39 712) | |
| Total Equity | 27 235 | 38 398 | |
| Current liabilities | |||
| Trade payables | 18 | 48 | |
| Liabilities to group companies | 8 | 16 | 9 658 |
| Other current liabilities | 12 | 394 | 135 |
| Total current liabilities | 428 | 9 842 | |
| Total equity and liabilities | 27 663 | 48 240 |
Oslo, 3 April 2025
The Board of Directors and CEO of Aquila Holding ASA
Chair Director Director
Nina Skage Ketil Skorstad Torstein Sanness
Kristian Zahl Interim CEO
Statement of changes in equity
| Additional | |||||
|---|---|---|---|---|---|
| USD thousands | Share capital |
paid-in capital |
Own shares |
Accumulated earnings |
Total equity |
| Balance as of 01.01.2024 | 28 739 | 51 171 | (1 799) | (39 712) | 38 398 |
| Profit (loss) for the period Other comprehensive income (loss) |
(10 795) | (10 795) - |
|||
| Purchase own shares | (453) | 84 | (370) | ||
| Delete own shares | (477) | 477 | - | ||
| Share based payment | - | - | |||
| Balance as of 31.12.2024 | 28 263 | 51 171 | (1 775) | (50 423) | 27 235 |
| Additional | |||||
|---|---|---|---|---|---|
| USD thousands | Share capital |
paid-in capital |
Own shares |
Accumulated earnings |
Total equity |
| Balance as of 01.01.2023 | 28 739 | 51 171 | (489) | (36 812) | 42 609 |
| Profit (loss) for the period Other comprehensive income (loss) |
(2 765) - |
(2 765) - |
|||
| Purchase own shares | (1 310) | (138) | (1 448) | ||
| Share based payment | 3 | 3 | |||
| Balance as of 31.12.2023 | 28 739 | 51 171 | (1 799) | (39 712) | 38 399 |
Statement of cash flow
| USD thousands | Note | 2024 | 2023 |
|---|---|---|---|
| Cash flow from operating activities | |||
| Profit before tax | (10 795) | (2 772) | |
| Taxes refund (paid) | 0 | 7 | |
| Write-down shares subsidiaries Changes in other gains (losses) without cash flow |
6 | 12 652 | - |
| effect | 1 | 730 | 1 000 |
| Share based payment cost | 15 | - | 3 |
| Other working capital changes | (2 951) | 3 784 | |
| Net cash from operating activities | (363) | 2 022 | |
| Net cash flow from investment activities | - | - | |
| Cash flow from financing activities | |||
| Investment in own shares | (370) | (1 448) | |
| Net cash flow from financial activities | (370) | (1 448) | |
| Net change in cash and cash equivalents | (733) | 574 | |
| Cash and cash equivalents balance 01.01 | 10 | 1 486 | 912 |
| Cash and cash equivalents balance 31.12 | 10 | 753 | 1 486 |
Notes to the financial statements
Note 1 Revenue and cost from contract with clients
There was no revenue in 2024 or 2023 as there was no operation.
The ocean-bottom seismic contract node on a rope business was divested in March 2022, through an earnout agreement with Magseis Fairfield. Under the agreement, Aquila received USD 0.5 million at closing and to further to receive earnout payments of up to a maximum of USD 12.0 million over the next three years, based on the use of the equipment. The minimum payment after year three is USD 1.5 million.
Due to the short remaining earn-out period a USD 0.7 million reduction in the fair value of the financial asset has been recognized in 2024. In 2023 a reduction of USD 1.0 million was recognized.
Note 2 Cost of sales
| Total operating expenses | 10 | (43) |
|---|---|---|
| Agent related expenses | 10 | (43) |
| Cost of sales | 2024 | 2023 |
| USD thousands |
Note 3 Personnel expenses and board remunerations
| USD thousands | 2024 | 2023 |
|---|---|---|
| Wages and salaries | 629 | 646 |
| Social Security costs | 108 | 110 |
| Pension costs | 44 | 53 |
| Other remuneration | 301 | 10 |
| Share based payment expense (refer to note 19 Group) | - | 3 |
| Refund salary | (1) | (16) |
| Total personnel expense | 1 081 | 806 |
| Number of man-years at 31.12 | 2024 | 2023 |
| Companies in Norway | 2.7 | 2.7 |
The Company has a defined contribution pension plan. The contribution plan is a retirement plan in which the Company pays fixed contributions to a separate legal entity. The Company has no further payment obligations once these contributions have been paid. Contributions are booked as cost on an ongoing basis. The Company meets the requirements for occupational pension scheme under the Act on Obligatory Occupational Pensions. The contribution pension scheme in Norway meets the legal requirements.
The Company has not granted any loan or collateral to the chair of the Board or other related parties.
Key management personnel compensation
| USD thousands | 2024 | 2023 |
|---|---|---|
| Base salary | 254 | 227 |
| Pension | 22 | 18 |
| Other Benefits | 4 | 2 |
| Number of options held | - | - |
For detailed information of executive officers and Board of Directors compensation, see the remuneration report 2024.
See note 12 for the Group for shares held by the executive officers and Board of Directors.
Note 4 Financial items
| USD thousands | ||
|---|---|---|
| Financial income | 2024 | 2023 |
| Interest income | 26 | 15 |
| Total financial income | 26 | 15 |
| Financial expenses | 2024 | 2023 |
| Other financial expenses | (2) | (100) |
| Write-down shares in subsidiaries | (2 000) | - |
| Total financial expenses | (2 002) | (100) |
| Currency exchange gain (loss) | 2024 | 2023 |
| Exchange gains | 18 | 312 |
| Exchange losses | (328) | (526) |
| Total currency exchange gain (loss) | (310) | (214) |
Note 5 Tax
| USD thousands | 2024 | 2023 |
|---|---|---|
| Specification of tax expense (income) for the year | ||
| Withholding tax and corporate tax abroad | (0) | (7) |
| Total tax expense (income) | (0) | (7) |
| Reconciliation of actual against expected tax expense (income) at the income tax rate of 22% |
||
|---|---|---|
| Profit (loss) before tax | (10 795) | (2 772) |
| 22% tax | (2 375) | (610) |
| Tax effect from: | ||
| Withholding tax abroad | (0) | (7) |
| Permanent differences | 182 | 118 |
| Not booked deferred tax assets | 1 296 | 179 |
| Currency effect | 898 | 313 |
| Receive Group contribution | - | - |
| Calculated tax expense (income) | (0) | (7) |
| Effective tax rate for the Company | 0.0 | 0.2 |
| USD thousands | 31.12.2024 | 31.12.2023 |
| Temporary differences | ||
| Non current assets | (2 778) | (3 873) |
| Accruals | (769) | (1 072) |
| Gain/loss account | (6 002) | (2) |
Accumulated loss carried forward (13 093) (10 806) Temporary differences at 31.12. (22 643) (15 752) Deferred tax assets (liabilities) 4 981 3 466
Deferred tax assets are not recognized per December 2024. The management evaluated the deferred tax assets to be uncertain when to be utilized in the future. This evaluation is performed yearly.
There is no time limit for use of loss carried forward in Norway.
Note 6 Subsidiaries and associated companies
Aquila Holdings ASA (AH ASA) comprise of the following legal entities as of 31 December 2024:
USD thousands
| Subsidiary of Aquila Holdings ASA: | Jurisdiction | Total Equity | Net Income/ (loss) |
Carrying value |
|---|---|---|---|---|
| Neptune Seismic AS | Norway | (24) | (10) | - |
| Axxis Geo Solution Inc. | USA | 9 | 9 | - |
| Axxis Multi Client AS | Norway | 18 302 | (6 587) | 18 322 |
| Axxis Production AS | Norway | (7 424) | 1 977 | - |
| Aquila Holdings Investment AS | Norway | 4 319 | (1 916) | 1 519 |
| Axxis Geo Solutions Egypt LLC* | Egypt | (1 764) | (2 707) | 1 |
| Total | 13 418 | (9 234) | 19 840 |
* Axxis Geo Solutions Egypt LLC is owned by Axxis Production AS 99% and Aquila Holdings ASA by 1% of the shares.
The Company holds 100 percent of all shares (except Axxis Geo Solution Egypt LLC as mentioned above) and all voting rights for its subsidiaries.
The change from 2023 is due to settlement of intercompany receivables through dividends classified as return of capital from the two subsidiaries and impairment of shares in subsidiaries of USD 2 million.
Aquila Holdings ASA (AH ASA) comprise of the following legal entities as of 31 December 2023
USD thousands
| Subsidiary of Aquila Holdings ASA: | Jurisdiction | Total Equity | Net Income/ (loss) |
Carrying value |
|---|---|---|---|---|
| Neptune Seismic AS | Norway | (13) | (0) | - |
| Axxis Geo Solution Inc. | USA | 15 | (10) | - |
| Axxis Multi Client AS | Norway | 30 961 | (1 866) | 25 971 |
| Axxis Production AS | Norway | (9 401) | 148 | - |
| Aquila Holdings Investment AS | Norway | 11 239 | (293) | 6 522 |
| Axxis Geo Solutions Egypt LLC* | Egypt | 942 | (2 804) | 1 |
| Total | 33 743 | (4 825) | 32 493 |
Note 7 Categories of financial instruments
USD thousands
| 31.12.2024 | 31.12.2023 |
|---|---|
| 1 299 | 2 029 |
| 753 | 1 486 |
| 2 052 | 3 515 |
| Financial liabilities at amortized cost | 31.12.2024 | 31.12.2023 |
|---|---|---|
| LIABILITIES | ||
| Trade payables | 18 | 48 |
| Other current liabilities | 394 | 135 |
| Total financial liabilities | 412 | 183 |
Aquila Holdings ASA exposure to various risks associated with the financial instruments is discussed in note 13 Financial risk management. The maximum exposure to credit risk at the end of the reporting period is the carrying amount of each class of financial assets mentioned above.
Transaction price
Financial assets are from the ocean-bottom seismic contract node on a rope business that was divested in March 2022, through an earnout agreement with Magseis Fairfield. Under the agreement, Aquila received USD 0.5 million at closing and to further to receive earnout payments of up to a maximum of USD 12.0 million over the next three years, based on the use of the equipment. The minimum payment after year three is USD 1.5 million.
Due to the short remaining earn-out period a USD 0.7 million reduction in the fair value of the financial asset has been recognized in 2024. In 2023 a reduction of USD 1.0 million was recognized.
Note 8 Related parties intercompany
| USD thousands | ||
|---|---|---|
| Current receivables group companies | 31.12.2024 | 31.12.2023 |
| Axxis Production AS | 5 255 | 11 727 |
| Axxis Geo Solutions Egypt LLC | 395 | 395 |
| Neptune Seismic AS | 22 | 11 |
| Total receivables group companies | 5 672 | 12 133 |
| USD thousands | ||
| Current liabilities group companies | 31.12.2024 | 31.12.2023 |
| Aquila Holdings Investment AS | - | 4 670 |
| Axxis Multi Client AS | 6 | 4 971 |
| Axxis Geo Solutions Inc. | 11 | 18 |
| Total liabilites group companies | 16 | 9 658 |
The change in current receivables from 2023 is due to impairment of the intercompany receivable in Axxis Production AS versus Axxis Geo Solutions Egypt LLC.
For more information on related parties to other than group companies see note 17 for the Group.
Note 9 Other current assets
| USD thousands | 31.12.2024 | 31.12.2023 |
|---|---|---|
| Prepayments | 60 | 68 |
| VAT settlement | 39 | 30 |
| Total other current assets | 98 | 99 |
Note 10 Bank deposits, cash in hand
| USD thousands | 31.12.2024 | 31.12.2023 |
|---|---|---|
| Bank deposits | 718 | 1 457 |
| Restricted bank deposits | 34 | 29 |
| Total bank deposits | 753 | 1 486 |
Restricted bank deposits relate to employee withholding tax. These deposits are subject to regulatory restrictions and are therefore not available for general use by the Company. The account is used to settle employee withholding tax.
Note 11 Share capital and shareholder information
Please see note 12 in the Group for more information.
Note 12 Other current liabilities
| USD thousands | 31.12.2024 | 31.12.2023 |
|---|---|---|
| Holiday pay owed | 49 | 74 |
| Other accrued costs | 345 | 61 |
| Total other current liabilities | 394 | 135 |
Note 13 Financial risk management
Capital Management – see note 15 in the Group for more information
Financing risk – see note 15 in the Group for more information
(i) Credit risk– see note 15 in the Group for more information
(ii) Market risk - interest rate– see note 9 and 15 in the Group for more information
(iii) Liquidity risk
Liquidity risk arises from lack of correlation between cash flow from operations and financial commitments. Per the balance sheet date, Aquila held current assets of USD 6 523 thousand, of which cash and cash equivalents represented USD 753 thousand and other current assets represent USD 98 thousand. In addition, the group's financial assets represent USD 1 299 thousand. In comparison, current liabilities amounted to USD 428 thousand.
The table below provides an overview of the maturity profile of all financial liabilities excluding intercompany receivables and liabilities:
2024
| Remaining Term | ||||||
|---|---|---|---|---|---|---|
| USD thousands | 0-3 months |
3-6 months |
6-9 months |
9-12 months |
1-2 years | Total |
| Trade payables | 18 | - | - | - | - | 18 |
| Other current liabilities |
394 | - | - | - | - | 394 |
| Total | 412 | - | - | - | - | 412 |
(iv) Currency risk
Substantial portions of Aquila's revenues and costs are in USD. Due to this, the group's operational exposure to exchange rate fluctuations is low. However, as the parent company pays taxes in Norwegian kroner (NOK) to the Norwegian Tax Authorities, salaries to employees and dividends to shareholders in NOK, fluctuations between the NOK and USD impact currency exchange gain or losses in the tax expense and financial items of the consolidated accounts. A reasonably possible strengthening (weakening) of the USD against NOK on 31 December would have affected profit or loss with the following amounts:
| USD thousands | Change in exchange rate USD/NOK |
Effect on profit before tax |
Effect on OCI |
|---|---|---|---|
| 2024 | + 10 % | 714 | - |
| - 10 % | (873) | - | |
| 2023 | + 10 % | (251) | - |
| - 10 % | 307 | - |
Note 14 Auditors fees
| USD thousands | ||
|---|---|---|
| Expensed audit fee (excluding VAT) | 2024 | 2023 |
| Statutory audit | 80 | 77 |
| Tax advice (incl. technical assistance with tax return) | - | - |
| Other attestation services | 5 | - |
| Total auditors fee | 85 | 77 |
The auditor of the Company is PricewaterhouseCoopers (PwC).
Note 15 Share based payments programs
Please see note 19 in the Group for more information.
Note 16 Commitments
As of December 2024, and 2023, the Company had commitments related to office rent for the Oslo office with one month's notice. The cost for short term leases of office rent for 2024 was USD 0.1 million and USD 0.1 million for 2023.
Note 17 Events after reporting period
See note 23 in the Group for more information.
6. Auditors report
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The Group's sustainability targets are focused on both its investment business as well as the seismic multi-client business.
The Group is exposed to climate-related risks associated with its legacy business as well as investments.
Governance and risk management
The Board and the management have an annual review of the Group's principles of corporate governance. In this review, the Group clarifies the division of roles between shareholders, the board and management.
The Company's sustainability strategy is embedded in the overall corporate strategy and is overseen by the Board. The Company oversees sustainability risks as part of the annual risk assessment evaluation. The Company relies upon policies, procedures, and guidelines to measure progress in mitigating risks. Additionally, each investment decision or significant commercial project undertaken by the Group incorporates risk analyses that evaluate key operational, health and safety, environmental, compliance and other risks prior to review and approval by the Company.
The Company has adopted ethical guidelines for the Group. The purpose of the guidelines is to create a healthy corporate culture and preserve the Group's integrity by helping employees to set a high standard of good business practice. Furthermore, the guidelines are intended as a tool for self-evaluation and for the development of the Group's identity.
Supply chain
The Company is committed to protecting people and the environment. As stewards of the environment, it is the collective responsibility of the Group and our people to protect the environments that we work in. The Company's intent is to conduct our business in a way which minimizes any impact our business may have on the environment.
The Company has implemented a series of performance indicators which we believe will ensure our focus on environment, social and governance factors. These performance indicators are in line with the guidelines put in place by the board of directors. Management's performance evaluation will in part be based on meeting targets for these indicators.
The Company works with partners and third parties to stress the importance of operating sustainably, ethically and in compliance with the law. Key areas of focus in evaluating third parties include providing a safe environment, ensuring compliance with the law, including anticorruption, labor, and human rights laws, when engaging in areas that represent a higher risk.
The Company operates in accordance with the Transparency Act. The company has put in place procedures to determine potential impacts on human rights and decent working conditions in the supply chain. The company conducts a risk-based due diligence approach with respect to its supply chain that considers the scope of services to be performed, where the services are to be performed and the nature of the third party.
The Company is dedicated to incorporating human rights laws, labor, environment and anticorruption in our strategy, culture and operations. The Company conducts its operations through a limited pool of suppliers, many of which have worked with the Group for an extended period of time. Geophysical operations require a skilled and certified workforce and the Company is of the opinion that measures put in place properly mitigates risks related to these suppliers.
Financial investments
The Group measures two indicators with respect to financial investments
- Investment companies should have reasonable environment, social and governance guidelines in place.
- Appropriate corporate governance policies should have been implemented.
The company made no new financial investments in 2024.
People
The Company is committed to ensuring a safe and respectful working environment for its employees. The health and wellbeing of our people is the key to the Company's success. Equality applies to all practices and guidelines relating to the recruitment process and hiring of all workers. We respect and protect the fundamental human and workers' rights in a manner consistent with laws and regulations.
The Company promotes a healthy workplace by prohibiting discrimination due to gender, race, age, ethnicity, disability, sexual orientation, or religion and provides fair compensation for employees' work. Respect for the individual is a cornerstone of the Group's operation.
The total number of permanent employees in the Group was three at the end of 2024 as well as at the end of 2023. The Group employed one woman and two men in 2024 and in 2023. No employees have been on parental leave in 2024 or 2023. The Group has one part-time employee at 70% in 2024 and 2023.
The Board of Directors consists of three members in 2024 as well as in 2023.
There have not been any significant personnel injuries or accidents in the current or prior years. The average sick day percentage for the work force was 8.8% in 2023 and reduced to 0.0% in 2024.
The company has established a target for absence due to illness to be lower than 2% annually. The company achieved this target in 2024. Absence due to illness in 2024 was 0.0%. The company has also established recruitment processes and hiring decisions to be based on the Group's standards for equal treatment. There has been no hiring of new full-time employees in 2024.
Business ethics
The Group is committed to prevent bribery, illegal influence, fraud, and money laundering. The Group achieves this through committing to operating all activities within the spirit and letter of laws and regulations that govern our businesses and employees. Employees must exercise the highest level of integrity, ethics and objectivity in any actions and relationships which may affect the Group. Employees must not misuse their authority or influence of their positions in these relationships. The Group shall strive for a clear culture of openness around all matters regarding customer care, relationship building, sponsorship, gifts, representation and travel.
All the employees completed anticorruption training in 2024 in addition to confirming review of the corporate policies on health and safety, ethics and social responsibility.
Aquila had no confirmed instances of corruption in 2024.
Cybersecurity
Risk related to cyber criminality is increasing globally. This threat is relevant for all devices connected to the internet. To protect the Group's assets and intellectual property, additional precautions and procedures have been implemented. The Group has taken steps to identify ongoing malicious activities and increase employee awareness of cyber threats. Despite these efforts, no guarantee can be made against potential future cyber-attacks, and any such attack could materially impact the Group's business and financial position.
Climate impact
The Group is exposed to climate-related risks primarily associated with its legacy business. This business may face reduced customer demand because of a growing focus on more environmentally attractive alternatives. Given the strong demand for oil and gas, the Group does not evaluate this risk as high in the coming year.
This business may also be exposed to increasingly stringent environmental regulations. Considering the growing focus on energy security, the Group does not evaluate this to be a high risk in the coming year.
The Group is not invested in exploration and production companies. However, its investments in the oil and gas sector are contributing to the production of emissions and the related effects on the environment. This could potentially be a risk for the Group's reputation in the investment community. The Group considers this to be a low risk in the coming year.
The Group also invests in companies which may be negatively impacted by increasingly stringent environmental regulations. The Group evaluates this risk prior to making any investment decision. However, increasing environmental regulations may have a significant adverse effect on the investment portfolio.
Transparency act
This statement represents the Company's account of due diligence pursuant to section 5 of the act related to enterprises' transparency and work on fundamental human rights and decent working conditions (the "Transparency Act"). The Transparency Act entered into effect on 1 July 2022.
The reporting period covered in this report is from 1 January 2024 to 31 December 2024.
There is a general desire for more transparency regarding the production of goods and the provision of services, especially relating to how businesses respect fundamental human rights and decent working conditions. It is hoped that the Transparency Act will lead to improvements in these areas and that the information available will allow consumers to make more informed choices.
Operations and locations
Aquila Holdings ASA is a public limited investment company. The Company's registered main office is at Askekroken 11, 0277 Oslo, Norway. Aquila comprises an ocean bottom node multiclient company and an investment arm. The Company may invest broadly in listed companies as well as companies expected to be listed in the near term.
Aquila has a legacy seismic business operating under the name Axxis Geo Solutions. Under Axxis Geo Solutions, the Company manages a seismic OBN multi-client data library with assets in Norway and Egypt.
Responsibility
The Board is responsible for the Company's implementation of applicable laws and regulations, including the Transparency Act.
All employees in the Company have a responsibility to protect human rights and decent working conditions.
If the Company causes, contributes to, or is linked to adverse impacts on human rights, the Company will take necessary steps to cease, prevent and/or mitigate the adverse impacts.
Vendors of Aquila
There are two categories of vendors:
- a) Vendors with a material value chain and subcontractors
- b) Vendors without a material value chain and primarily delivering their own services or goods, not relying in a significant way on subcontractors
In 2024 Aquila categories their vendors as follows:
- c) Vendors from Axxis multi-client business
- d) Vendors from the investment business
- e) Vendors from being a listed company and general office services
A. Vendors from Axxis muti-client business
Aquila did not have new multi-client projects in 2024. The Utsira survey was finalized in 2020. A reprocessing of the Utsira survey was commenced in 2022 and this work continued through 2024. The Company performed an evaluation of its vendors for this work.
The Gulf of Suez survey in Egypt was finalized in Q3 2022, and the processing was performed by the Company's business partner, Schlumberger. Schlumberger is following their own transparency requirements and Aquila did therefore not do any further due diligence on this vendor.
The multi-client data is stored electronically and the vendor providing this service does not significantly rely on third parties for data storage.
B. Vendors from the investment business
Aquila made no new investments in 2024.
C. Vendors from being a listed company and general office services
The vendors for the Group are only business partners, as they are not generally dependent on subcontractors in delivering their services. The Group works with a number of business partners which generally provide consulting services, IT solutions, office services, insurance, pension, capital markets and other services.
After the review of the Group's three categories of vendors the Group classified all their vendors as business partners.
These business partners are evaluated as low risk in accordance with the evaluation criteria outlined in the table below. In 2024, the Group had 77 vendors which were evaluated according to the following criteria:
| Production of Production of Production of goods from Production of goods from goods from Norway goods from EU US Egypt Production of Delivered in Delivered in Delivered in goods Norway, EU/EA, US or US, EU/EA or Delivered in EU/EA or low low-cost low-cost Egypt or low |
Provision of services |
Services from vendors in Norway |
Services from vendors in EU/EA |
Services from vendors in US |
Services from vendors in Egypt |
|---|---|---|---|---|---|
| cost country | country | country | cost country |
To determine potential adverse impacts on human rights and decent working conditions a combination of the following factors was evaluated; vendors locations and country of origin, industry of the vendor, the spend values, knowledge of the vendor and web search.
All vendors were then evaluated according to low, medium or high risk for both human rights violation and breach of working conditions.
Result for 2024 evaluation
After review of the 77 vendors, 7 of the vendors in Egypt ended on medium risk due to locations and country of origin. Following further investigation of these vendors through web searches and knowledge of worldwide consulting services, the Group assessed the risk as acceptable for all vendors in Egypt.
Consequence if negative risk by any of the vendors
If there had been any negative risk on any vendor after the assessment, the Group would have tried to change to a "green vendor", if possible.
If it would have been difficult to change and use another vendor, the Group would have contacted the vendor for more information about the vendor's actions to avoid human rights violation and avoid breach of working conditions in their company. Based on this review, a conclusion would have been made.
Going forward
The Group intends to continue its vendor evaluation policies in line with the structure highlighted above. The Group performs periodic evaluations to make sure its vendors have an acceptable status. All new vendors will be separately evaluated.
The Company recognizes that risk of adverse impact on human rights cannot categorically be ignored based on the above risk-reducing factors alone and therefore considers regular risk assessment and continuous monitoring to be important to prevent, detect and respond to potential adverse impacts on human rights.
About Aquila Holdings ASA
Aquila Holdings ASA ("AQUIL") is a Norwegian seismic multi-client and investment company listed on Euronext Expand. Aquila Holdings specializes in 3D ocean bottom node seismic multiclient data for near-field exploration. The company holds two key seismic multi-client assets, one in Norway and one in Egypt. Aquila Holdings also has an investment arm, with focus on investments in listed companies as well as companies expected to be listed.
More information on www.aquilaholdings.no
The information included herein contains certain forward-looking statements that address activities, events, or developments that the Company expects, projects, believes or anticipates will or may occur in the future. These statements are based on various assumptions made by the Company, which are beyond its control and are subject to certain additional risks and uncertainties. The Company is subject to many risk factors including, but not limited to, the demand for data from our multi-client data library, the attractiveness of our technology, unpredictable changes in governmental regulations affecting our markets. For a further description of other relevant risk factors, we refer to our Annual Report for 2022. As a result of these and other risk factors, actual events and our actual results may differ materially from those indicated in or implied by such forward-looking statements. The reservation is also made that inaccuracies or mistakes may occur in the information given above about the status of the Company or its business. Any reliance on the information above is at risk of the reader and the Company disclaims all liability in this respect.
72
Oslo, Norway Askekroken 11 0277 OSLO Norway