Quarterly Report • Aug 31, 2017
Quarterly Report
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| Amounts in MNOK (except EPS, shares and percentage) | Q2 2017 | Q2 2016 | H1 2017 | H1 2016 | FY 2016 |
|---|---|---|---|---|---|
| FINANCIAL | |||||
| Net operating revenues | 738.9 | 710.9 | 1 538.6 | 1 364.8 | 2 604.6 |
| Growth (%) | 3.9% | 27.5% | 12.7% | 22.8% | 15.9% |
| EBITDA, underlying 1) | 27.3 | 92.0 | 132.8 | 150.2 | 225.5 |
| EBITDA margin (%), underlying 1) | 3.7% | 12.9% | 8.6% | 11.0% | 8.7% |
| EBIT, underlying 1) | 15.8 | 81.1 | 110.2 | 129.0 | 182.3 |
| EBIT margin (%), underlying 1) | 2.1% | 11.4% | 7.2% | 9.5% | 7.0% |
| Basic earnings per share (NOK) | 0.42 | 2.41 | 3.16 | 3.77 | 8.15 |
| Average number of shares | 26 242 784 | 26 244 258 | 26 241 964 | 26 239 724 | 26 243 164 |
| Net interest bearing debt (negative is asset) 1) | 89.0 | (40.1) | 89.0 | (40.1) | (116.5) |
| Cash and cash equivalents | 157.8 | 50.0 | 157.8 | 50.0 | 176.0 |
| OPERATIONAL | |||||
| Order intake | 866.9 | 908.4 | 1 940.6 | 1 671.5 | 3 084.7 |
| Order backlog | 1 995.0 | 1 839.3 | 1 995.0 | 1 839.3 | 1 793.1 |
| Billing ratio (%) | 69.5% | 70.9% | 68.9% | 70.0% | 69.2% |
Employees 2 511 2 222 2 511 2 222 2 344
1) Refers to page 23 to define underlying financial performance and alternative performance measures.
Multiconsult delivered a second quarter EBIT of NOK 15.8 million, reflecting revenue growth of 3.9% in a quarter that was significantly impacted by a negative calendar effect of seven less working days in Norway compared to the same period last year. Order backlog remains strong at NOK 2.0 billion. Share purchase agreement for acquisition of the 70 year old Norwegian consulting engineering companies Hjellnes Consult and Johs Holt was signed, in line with 3-2-1 GO strategic objectives.
(Figures in brackets = same period prior year or relevant balance sheet date 2017).
With effect from 1 January 2017, Multiconsult ASA has made a change to the reporting of its business areas. Please see note 4 for further details.
Net operating revenues increased by 3.9% to NOK 738.9 million (NOK 710.9 million) compared to the same quarter last year. The increase in net operating revenues reflects higher production due to net recruitment and acquisition of Iterio AB, aarhus arkitekterne A/S and Akvator AS. Growth in net operating revenues was further impacted by good project execution. There was a negative calendar effect of seven less working days in Norway this quarter, significantly impacting net operating revenues. The billing ratio fell to 69.5% (70.9%) with a negative effect on net operating revenues. Billing rates were at similar levels to last year. Buildings & Properties with projects like Campus Ås and Transportation with projects like New Airbase Ørland made strong contributions to operating revenues.
Operating expenses increased by 15.0% to NOK 711.6 million (NOK 618.9 million). The increase is mainly attributable to higher employee benefit expenses caused by ordinary salary adjustment and increased headcount related to acquisitions and net recruitment. Administrative expenses increased accordingly in the quarter. However, some non-recurring expenses, including the implementation of the new ERP system impacted the second quarter.
EBITDA was NOK 27.3 million (NOK 92.0 million), a decrease of 70.3% compared to the same period last year. The higher net operating revenues were more than offset by higher operating expenses in the quarter.
EBIT amounted to NOK 15.8 million (NOK 81.1 million), a decrease of 80.6%.
Results from associated companies and joint ventures amounted to NOK 0.1 million (NOK 2.8 million).
Net financial items was an expense of NOK 1.5 million (expense of NOK 1.1 million), due to higher level of interest bearing debt.
Group tax rate was 23.7% (23.7%).
Reported profit for the period was NOK 11.0 million (NOK 63.1 million). Earnings per share for the quarter were NOK 0.42 (NOK 2.41).
Net operating revenues increased by 12.7% to NOK 1 538.6 million (NOK 1 364.8 million) compared to the same period last year. The increase in net operating revenues was mainly driven by higher production due to net recruitment and acquisition of Iterio AB, aarhus arkitekterne A/S and Akvator AS. Growth in revenues was partly offset by a lower billing ratio at 68.9% (70.0%).
EBITDA was NOK 132.8 million (NOK 150.2 million), a decrease of 11.6% compared to the same period last year. The higher
net operating revenues were more than offset by the increase in operating expenses in the period. Higher employee benefit expenses reflect the impact of ordinary salary adjustment and increased headcount related to acquisitions and net recruitment. Administrative expenses increased accordingly in the period. However, some non-recurring expenses, including implementation of new ERP system, impacted the period.
EBIT amounted to NOK 110.2 million (NOK 129.0 million), a decrease of 14.6%.
Group tax rate was 23.6% (24.4%). The decrease being mainly related to the change in corporate tax rates in Norway to 24% (25%) from 1 January 2017.
Reported profit for the period was NOK 83.0 million (NOK 98.9 million).
Net cash flow from operating activities was NOK 13.9 million (NOK 40.9 million). The decrease was mainly related to lower net profit. Working capital increased by NOK 4.6 million (NOK 39.6 million) due to higher receivables and work in progress, which more than offset higher current liabilities.
Net cash flow used in investment activities was NOK 17.1 million this quarter (NOK 33.7 million), mainly related to ordinary asset replacement and sale of real estate assets in Regions Norway. NOK 33.7 million used in the same quarter last year was mainly for ordinary asset replacement and the cash effect of business combinations.
Net cash flow from financing activities amounted to NOK 10.8 million (negative NOK 76.1 million), due to a higher level of interest bearing debt and dividend payment in the second quarter.
Net cash flow from operating activities was negative NOK 52.9 million (negative NOK 60.6 million). Lower net profit more than offset lower income tax paid in first half 2017 compared to the same period last year. Working capital increased due to higher trade receivables and work in progress as a result of higher production. Working capital increased in the first half 2017 by NOK 149.9 million (NOK 144.4 million).
Net cash flow used in investment activities was NOK 80.4 million (NOK 40.7 million), mainly related to the acquisition of Iterio AB and ordinary asset replacement.
Net cash flow from financing activities was NOK 108.1 million (negative NOK 76.1 million). The increased interest bearing debt more than offset the dividend payment.
As of 30 June 2017, total assets amounted to NOK 1 587.5 million (NOK 1 519.1 million at 31 March 2017), and total equity amounted to NOK 516.0 million (NOK 582.6 million at 31 March 2017).
The group had cash and cash equivalents of NOK 157.8 million as of 30 June 2017 (NOK 146.9 million at 31 March 2017). Interest bearing debt amounted to NOK 246.8 million (NOK 156.7 million at 31 March 2017). Net interest bearing debt amounted to NOK 89.0 million (NOK 9.8 million at 31 March 2017).
The order backlog remains strong at the end of the second quarter and was NOK 1 995.0 million (NOK 1 839.3 million), an increase of 8.5% year on year. Call-offs on frame agreements, such as the new and important agreements for consulting services to Statens vegvesen for a ferry-free E39 between Kristiansand and Trondheim, are only included in the order backlog when signed.
Order intake during the second quarter decreased by 4.6% to NOK 866.9 million (NOK 908.4 million). There were solid sales within Buildings & Properties, Transportation and Renewable Energy in a quarter that had seven less working days in Norway. New contribution from sales from Iterio AB and aarhus arkitekterne A/S impacted the order intake in the quarter positively. There have been many small and mid-size contract awards and the tender pipeline in the transportation sector is strong.
The majority of the order intake this quarter came from new contracts. Among important new contracts this quarter was LINK arkitektur's Ulven commercial real estate development project with OBOS and Holsfjorden water supply to Oslo with Oslo City Water and Sewage Works Agency. Important add-ons to existing contracts this quarter were Campus Ås and New Airbase Ørland in Norway as well as Mount Coffee in Liberia.
Multiconsult is organised in three geographical segments, Greater Oslo Area, Regions Norway, International, and a segment for LINK arkitektur.
The segment offers services in six business areas and comprises the central area of eastern Norway, with regional offices in Oslo, Fredrikstad and Drammen.
| Amounts in MNOK | Q2 2017 |
Q2 2016 |
H1 2017 |
H1 2016 |
|---|---|---|---|---|
| Net op. revenues | 308.4 | 324.7 | 659.1 | 626.2 |
| EBITDA | 11.0 | 54.5 | 66.8 | 94.0 |
| EBITDA% | 3.6% | 16.8% | 10.1% | 15.0% |
| Order intake | 321.5 | 368.8 | 797.6 | 743.4 |
| Order Backlog | 781.0 | 904.4 | 781.0 | 904.4 |
| Billing ratio | 68.3% | 72.8% | 68.1% | 72.1% |
| Employees | 903 | 854 | 903 | 854 |
Net operating revenues decreased by 5.0% to NOK 308.4 million (NOK 324.7 million) compared to the same quarter last year. The decrease was mainly driven by the calendar effect of seven less working days in the quarter and a lower billing ratio of 68.3% (72.8%). The billing ratio was negatively impacted by high tender activity in the quarter. The decrease in revenues was partly offset by net recruitment and good project execution, which resulted in net project write-ups. The billing rates continued to rise modestly this quarter, further supporting revenues.
EBITDA amounted to NOK 11.0 million (NOK 54.5 million), a decrease of 79.8% from last year. Lower revenues and higher employee benefit expenses, as a result of net recruitment and salary adjustment, as well as increased administrative expenses contributed to the decrease in EBITDA.
Order intake in the second quarter was NOK 321.5 million (NOK 368.8 million), a decrease of 12.8% compared to the same quarter last year. Buildings & Properties and Renewable Energy had strong contributions in the quarter, while there was an absence of major contract awards within Transportation. The majority of the order intake came from add-ons to and extensions of existing contracts. Important add-ons to existing contracts this quarter were the Campus Ås, Prinsensgate 26 and New Airbase Ørland in Norway as well as Mount Coffee in Liberia. New contracts, such as the Holsfjorden water supply to Oslo, were also awarded in the quarter.
Order backlog for the segment at the end of the second quarter amounted to NOK 781.0 million (NOK 904.4 million), down 13.6% year on year.
Net operating revenues increased by 5.2% to NOK 659.1 million (NOK 626.2 million), mainly due to higher production as a result of net recruitment. Good project execution resulted in net project write-ups and impacted net operating revenues positively. Billing rates have had a modest increase in the first two quarters of 2017 and further support growth in revenues. The billing ratio decreased to 68.1% (72.1%) and partly offset growth in revenues. The billing ratio was negatively impacted by high tender activity in the period.
EBITDA amounted to NOK 66.8 million (NOK 94.0 million), a decrease of 29.0%, mainly due to higher employee benefit expenses as a result of net recruitment and salary adjustment. Increased administrative expenses contributed to the decrease.
Order intake amounted to NOK 797.6 million (NOK 743.4), an increase of 7.3% from last year.
The segment offers services in six business areas and comprises regional offices in Kristiansand, Stavanger, Bergen, Trondheim and Tromsø.
| Amounts in MNOK | Q2 2017 |
Q2 2016 |
H1 2017 |
H1 2016 |
|---|---|---|---|---|
| Net op. revenues | 268.2 | 261.5 | 550.0 | 502.1 |
| EBITDA | 13.0 | 29.6 | 41.2 | 47.7 |
| EBITDA% | 4.9% | 11.3% | 7.5% | 9.5% |
| Order intake | 331.0 | 378.6 | 554.9 | 591.3 |
| Order Backlog | 498.0 | 533.6 | 498.0 | 533.6 |
| Billing ratio | 69.4% | 70.5% | 67.9% | 69.3% |
| Employees | 827 | 788 | 827 | 788 |
Net operating revenues amounted to NOK 268.2 million (NOK 261.5 million), an increase of 2.5% compared to the same quarter last year. The growth was mainly driven by higher production due to acquisitions and net recruitment. Akvator AS contributed with a full quarter this year compared to only one month in the second quarter last year. Growth in net operating revenues was partly offset by a negative calendar effect of seven less working days in the quarter and a decrease in the billing ratio to 69.4% (70.5%). Billing rates were stable in the quarter. Other operating revenues include a gain on the sale of the office property in Tromsø.
EBITDA was NOK 13.0 million (NOK 29.6 million), a decrease of 56.1%. The increase in net operating revenues was more than offset by higher operating expenses, such as salary adjustment, office rent and other administrative expenses.
Order intake in the second quarter was NOK 331.1 million (NOK 378.6 million), a decrease of 12.6% compared to the same quarter last year. There was a solid order intake in Buildings & Properties and Transportation in the quarter, however, there was an absence of major contract awards in the quarter within Transportation. The majority of the order intake came from a large number of smaller new contracts. Among new contracts this quarter was the design of five tunnels for Statens vegvesen on the E39 motorway between Kristiansand and Trondheim as well as Bolstadøyri railway crossing. Among additions to existing contracts this quarter were the add-ons to the New Airbase Ørland.
Order backlog for the segment at the end of the second quarter amounted to NOK 498.0 million (NOK 533.6 million), down 6.7% year on year.
Net operating revenues increased by 9.5% to NOK 550.0 million (NOK 502.1 million), mainly due to higher production due to acquisitions and net recruitment. Akvator AS contributed with a full six months of the period compared to only one month last year. The billing ratio decreased to 67.9% (69.3%) and partly offset growth in revenues.
EBITDA amounted to NOK 41.2 million (NOK 47.7 million), a decrease of 13.7%, mainly due to higher operating expenses, related to ordinary salary adjustments, office rent and other administrative expenses.
Order intake amounted to NOK 554.9 million (NOK 591.3), a decrease of 6.2% from last year.
The international segment comprises the subsidiaries Multiconsult UK, Multiconsult Asia, Multiconsult Polska and Iterio AB.
| Q2 | Q2 | H1 | H1 | |
|---|---|---|---|---|
| Amounts in MNOK | 2017 | 2016 | 2017 | 2016 |
| Net op. revenues | 46.3 | 24.6 | 92.8 | 43.9 |
| EBITDA | 3.4 | 2.5 | 17.0 | 2.4 |
| EBITDA% | 7.3% | 10.1% | 18.3% | 5.4% |
| Order intake | 62.5 | 20.4 | 226.0 | 65.6 |
| Order Backlog | 285.1 | 173.7 | 285.1 | 173.7 |
| Billing ratio | 71.9% | 62.8% | 72.6% | 61.1% |
| Employees | 197 | 127 | 197 | 127 |
Net operating revenues amounted to NOK 46.3 million (NOK 24.6 million), an increase of 88.0% compared to the same quarter last year. The increase in net operating revenues in the quarter is mainly due to the contribution from Iterio AB.
EBITDA was NOK 3.4 million (NOK 2.5 million) for the quarter. Iterio AB, together with Multiconsult Polska and Multiconsult UK contributed to the improved results. As expected, Multiconsult Asia experienced low project activity in the quarter due to awaiting new contract awards.
Order intake in the second quarter was NOK 62.5 million (NOK 20.4 million), an increase of 206.2% compared to the same quarter last year. Main contribution to the order intake in the second quarter came from Iterio AB, within Transportation.
Order backlog for the segment at the end of the second quarter amounted to NOK 285.1 million (NOK 173.7 million), up 64.1% year on year.
Net operating revenues amounted to NOK 92.8 million (NOK 43.9 million), an increase of 111.4% compared to the first half last year. The growth in net operating revenues is mainly attributed to high short-term project activity supported by temporary staffing in Multiconsult Asia in the first quarter this year. The growth was further supported by increased production in Multiconsult UK and Multiconsult Polska as well as the contribution from Iterio AB.
EBITDA was NOK 17.0 million (NOK 2.4 million) for the period, reflecting increased activity in all subsidiaries as well as the contribution from Iterio AB.
Order intake amounted to NOK 226.0 million (NOK 65.6), an increase of 244.5% from last year.
This segment comprises of LINK arkitektur with 15 offices throughout Scandinavia.
| Amounts in MNOK | Q2 2017 |
Q2 2016 |
H1 2017 |
H1 2016 |
|---|---|---|---|---|
| Net op. revenues | 118.3 | 94.2 | 240.1 | 183.7 |
| EBITDA | 0.7 | 5.5 | 10.1 | 5.8 |
| EBITDA% | 0.6% | 5.8% | 4.2% | 3.1% |
| Order intake | 149.4 | 140.5 | 358.1 | 271.2 |
| Order Backlog | 431.0 | 227.5 | 431.0 | 227.5 |
| Billing ratio | 71.9% | 70.3% | 71.8% | 70.4% |
| Employees | 454 | 337 | 454 | 337 |
Net operating revenues amounted to NOK 118.3 million (NOK 94.2 million), an increase of 25.7% compared to the same quarter last year. The growth was mainly driven by higher production from net recruitment as well as new contribution from aarhus arkitekterne A/S. Working hours were increased from 37.5 to 40.0 hours per week for all employees in Norway starting 1 October 2016 and contributed positively to the
growth year on year. Growth in net operating revenues was partly offset by a negative calendar effect of seven less working days in Norway as well as low production in Denmark. The operations in Denmark were impacted by a low success rate on new project tenders and a high level of sales activities in the quarter.
EBITDA amounted to NOK 0.7 million (NOK 5.5 million) in the second quarter. Improved net operating revenues were partly offset by higher employee benefit expenses as a result of acquisitions and net recruitment.
Order intake in the second quarter was NOK 149.4 million (NOK 140.5 million), an increase of 6.3% compared to the same quarter last year. The majority of the order intake in the quarter came from a substantial amount of smaller, but important new contracts and add-ons to existing contracts. Among important new contracts this quarter was the Ulven commercial real estate development project with OBOS in Norway.
Order backlog for the segment at the end of the second quarter amounted to NOK 431.0 million (NOK 227.5 million), an increase of 89.5% compared to the same quarter last year.
Net operating revenues amounted to NOK 240.1 million (NOK 183.7 million), an increase of 30.7% compared to the same period last year, mainly due to higher production from net recruitment and the contribution from aarhus arkitekterne A/S.
EBITDA amounted to NOK 10.1 million (NOK 5.8 million) in the period. Improved net operating revenues were partly offset by higher employee benefit expenses as a result of the acquisition and net recruitment.
Order intake was NOK 358.1 million (NOK 271.2 million), an increase of 32.1%.
At 30 June 2017 the group had 2 511 employees. The turnover ratio for the group was stable at 7.1% for the period June 2016 to June 2017.
On 23 June, Multiconsult held an extraordinary general meeting where a new legal structure for the Multiconsult group was approved. The company's Norwegian operational activities will be demerged and then merged into a wholly-owned subsidiary. The purpose of the new legal structure is to establish a more efficient legal structure for the Multiconsult group. The new legal structure is effective as of 25 August 2017. For more information, please see the minutes of the extraordinary general meeting for Multiconsult held 23 June 2017.
Multiconsult has adopted HSE policies and implemented guidelines to ensure continued compliance with applicable regulations and to maintain and develop its HSE standards. The company's HSE efforts are managed on both central and regional levels.
Recorded sick leave ratio (parent company) was 3.2% for the quarter (3.4%). Sick leave for the group in the first quarter was 3.6%.
On 24 August 2017, Multiconsult announced a contract award with Polish State Railways Joint Stock Company for the development of the project entitled "Work on the railway line No. 38 on the section of Ełk – Korsze". Multiconsult Polska will provide design documentation, obtain regulatory permits and supervise work during construction. This is the largest railway contract ever awarded to Multiconsult Polska. The value of the contract will be more than NOK 30 million and the project will continue until the end of 2018.
On 10 July, Multiconsult entered into a share purchase agreement to purchase 100% of the shares in Hjellnes Consult AS and Johs Holt AS. Multiconsult aspires to take new market shares and increase the competitiveness of the company's strategic investments in urbanism, healthcare and transportation, in line with the company's 3-2-1 GO strategic objectives. Johs Holt's has a very strong position and reputation as specialists in bridge designs. Together with the resources of Multiconsult a solid position within the transportation market will be further strengthened and provide a platform for further growth. The total purchase price is NOK 184 million and the settlement will be a combination of NOK 119 million in cash and NOK 65 million in Multiconsult shares. As part of the settlement, Multiconsult will issue 721 194 shares. The closing date is planned by the end of September 2017.
The overall market outlook for 2017 remains fairly positive.
Buildings & Properties is expected to maintain stable growth. The outlook for the architecture market shows signs of positive development, but continues to be impacted by regional variations. Public sector investment is driving a strong outlook for Transportation within road and rail and several large projects are expected to be assigned in the coming year. The Renewable Energy market in Norway is expected to be stable, with continued growth within transmission. International Renewable Energy markets continue to grow, providing new business opportunities for Multiconsult. Investments in the Industry segment are expected to be slightly lower due to completion of several major projects, while investment in aquaculture remains strong. Demand for our services in the Oil & Gas market is expected to slowly improve going forward, particularly in international markets. Within Water & Environment there is a stable demand for water and waste infrastructure projects as well as for soil contamination inspections.
The overall competitive landscape is migrating towards more Engineering, Procurement and Construction (EPC) contracts.
Continued strong competition is maintaining price pressure on large projects in Norway. Current market rates have stabilised, however the increase in salaries for the Norwegian workforce is creating challenges to profitability for the industry in general.
Multiconsult's strong market position, flexible business model and wide service offering provides a sound base for further growth, both domestic and international. Resources from Multiconsult Polska are gradually being phased into ongoing projects to strengthen competitiveness. The top line synergies between Multiconsult and LINK arkitektur are expected to continue to further strengthen the group's value proposition to customers.
The order backlog remains strong and provides a strong foundation for continued growth, supported by valuable frame agreements generated from a broad and robust customer base.
Multiconsult will continue to focus on sales efforts, improvement of the billing ratio, strong project execution and cost efficiency throughout the organisation to secure profitable growth.
The risk of disagreements and legal disputes related to the possible cost of delays and project errors is always present in the consultancy business. Multiconsult has good insurance policies and routines for following up such cases. Further details regarding the insurance coverage are provided in note 19 to the consolidated financial statements for 2016.
Multiconsult is exposed to credit risk, primarily related to transactions with clients and from bank deposits. The company's losses on accounts receivable have been modest for a number of years. New customers are subject to credit assessment and approval before credit is extended to them. Responsibility for credit management in the parent company is centralised, and routines are integrated in the group's quality assurance system. The company has established routines for assessing the creditworthiness of the customer, and the possible need for bank guarantees or other risk mitigation measures.
The group is exposed to currency risk through ongoing projects abroad with fees in foreign currencies. Hedging contracts have been entered into for certain projects to reduce this risk. Currency risk is regarded as modest.
The parent company uses its overdraft facility, but it's interestbearing debt is limited. Accordingly, the company has a low interest-rate risk related to debt. Liquidity management is followed up actively through budgets and regular forecasting. To ensure sufficient freedom of action in terms of liquidity, and thereby to moderate liquidity risk, an overdraft facility of NOK 220.0 million and an additional revolving credit facility of NOK 95.0 million for three years has been established with the parent company's bank. The revolving credit facility at 30 June 2017 was drawn with NOK 95.0 million, related to the acquisition of aarhus arkitekterne A/S and Iterio AB.
We confirm to the best of our knowledge that the condensed set of financial statements for the period 1 January to 30 June 2017 have been prepared in accordance with IAS 34 - Interim Financial Reporting, and gives a true and fair view of the Multiconsult group's assets, liabilities, financial position and result for the period. We also confirm to the best of our
knowledge that the financial review includes a fair review of important events that have occurred during the financial year and their impact on the financial statements, any major related parties' transactions, and a description of the principal risks and uncertainties.
Oslo, 30 August 2017 The Board of Directors and CEO Multiconsult ASA
Nigel K.Wilson Kjetil Ebbesberg Vibeke Strømme Arne Fosen Line Haugen Chairman Board member Board member Board member Board member
Board member Board member Board member CEO
Runar Tyssebotn Liv-Kristine Rud Elisabeth W. Lokshall Christian Nørgaard Madsen
Net operating revenues: Operating revenues less sub consultants and disbursements.
EBIT: Earnings before net financial items, results from associates and joint ventures and income tax.
EBIT margin (%): EBIT as a percentage of net operating revenues.
EBITDA: EBIT before depreciation, amortisation and impairment.
EBITDA margin (%): EBITDA as a percentage of net operating revenues.
Operating expenses: Employee benefit expenses plus other operating expenses.
Net interest bearing debt: Non-current and current interest bearing liabilities deducted cash and cash equivalents.
Order intake: Expected operating revenues on new contracts and confirmed changes to existing contracts. Only group external contracts are included.
Order Backlog: Expected remaining operating revenues on new and existing contracts. Only group external contracts are included. Call-offs on frame agreements are included in the order backlog when signed.
Billing ratio (%): Hours recorded on chargeable projects as a percentage of total hours worked (including administrative staff) and employer-paid absence. Billing ratio per segment includes allocated administrative staff.
Employees: Number of employees comprise all staff on payroll including staff on temporarily leave (paid and unpaid), excluding temporary personnel.
This report includes forward-looking statements, which are based on our current expectations and projections about future events. All statements other than statements of historical facts included in this notice, including statements regarding our future financial position, risks and uncertainties related to our business, strategy, capital expenditures, projected costs and our plans and objectives for future operations, including our plans for future costs savings and synergies may be deemed to be forward-looking statements. Words such as "believe," "expect," "anticipate," "may," "assume," "plan," "intend," "will," "should," "estimate," "risk"
and similar expressions or the negatives of these expressions are intended to identify forward-looking statements. By their nature, forward-looking statements involve known and unknown risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Forward-looking statements are not guarantees of future performance. You should not place undue reliance on these forward-looking statements. In addition, any forwardlooking statements are made only as of the date of this notice, and we do not intend and do not assume any obligation to update any statements set forth in this notice.
Unaudited for the period ended 30 June 2017
| Amounts in TNOK, except EPS | Q2 2017 | Q2 2016 | H1 2017 | H1 2016 | FY 2016 |
|---|---|---|---|---|---|
| Operating revenues | 840 500 | 817 671 | 1 733 123 | 1 549 928 | 2 968 069 |
| Expenses for sub consultants and disbursements | 101 601 | 106 776 | 194 489 | 185 118 | 363 448 |
| Net operating revenues | 738 898 | 710 895 | 1 538 635 | 1 364 810 | 2 604 621 |
| Employee benefit expenses 1) | 589 629 | 505 870 | 1 157 914 | 1 005 097 | 1 841 605 |
| Other operating expenses | 121 988 | 113 055 | 247 922 | 209 483 | 430 227 |
| Operating expenses excl. depreciation, | |||||
| amortisation and impairments | 711 618 | 618 925 | 1 405 836 | 1 214 580 | 2 271 832 |
| Operating profit before depreciation, | |||||
| amortisation and impairments (EBITDA) | 27 281 | 91 970 | 132 798 | 150 231 | 332 789 |
| Depreciation, amortisation and impairments | 11 520 | 10 885 | 22 601 | 21 182 | 43 205 |
| Operating profit (EBIT) | 15 760 | 81 086 | 110 197 | 129 049 | 289 584 |
| Results from associated companies and joint ventures | 110 | 2 780 | 599 | 4 020 | 4 053 |
| Financial income | 806 | 682 | 1 920 | 1 378 | 4 082 |
| Financial expenses | 2 303 | 1 761 | 4 078 | 3 494 | 9 986 |
| Net financial items | (1 497) | (1 080) | (2 158) | (2 116) | (5 904) |
| Profit before tax | 14 373 | 82 786 | 108 639 | 130 953 | 287 733 |
| Income tax expense | 3 402 | 19 643 | 25 603 | 32 018 | 73 964 |
| Profit for the period | 10 972 | 63 144 | 83 035 | 98 935 | 213 769 |
| Attributable to: | |||||
| Owners of Multiconsult ASA | 10 972 | 63 144 | 83 035 | 98 935 | 213 769 |
| Earnings per share | |||||
| Basic and diluted (NOK) | 0.42 | 2.41 | 3.16 | 3.77 | 8.15 |
1) Gain on settlement of defined benefit pension plan of NOK 107.3 million is included as decreased employee benefit expenses in FY 2016.
| Amounts in TNOK | Q2 2017 | Q2 2016 | H1 2017 | H1 2016 | FY 2016 |
|---|---|---|---|---|---|
| Profit for the period | 10 972 | 63 144 | 83 035 | 98 935 | 213 769 |
| Other comprehensive income | |||||
| Remeasurment of defined benefit obligations | - | - | - | (73 339) | 37 923 |
| Tax | - | - | - | 18 335 | (9 471) |
| Total items that will not be reclassified to profit or loss | - | - | - | (55 004) | 28 452 |
| Currency translation differences | 1 614 | (3 071) | 4 665 | (3 569) | (4 187) |
| Total items that may be reclassified subsequently to profit or loss | 1 614 | (3 071) | 4 665 | (3 569) | (4 187) |
| Total other comprehensive income for the period | 1 614 | (3 071) | 4 665 | (58 574) | 24 265 |
| Total comprehensive income for the period | 12 586 | 60 073 | 87 700 | 40 361 | 238 033 |
| Attributable to: | |||||
| Shareholders of Multiconsult ASA | 12 586 | 60 073 | 87 700 | 40 361 | 238 033 |
| Amounts in TNOK | At 30 June 2017 | At 31 March 2017 | At 31 December 2016 |
|---|---|---|---|
| ASSETS | |||
| Non-current assets | |||
| Deferred tax assets | 26 516 | 26 080 | 25 104 |
| Intangible assets | 11 797 | 10 627 | 9 348 |
| Goodwill | 287 231 | 280 959 | 235 727 |
| Property, plant and equipment | 104 161 | 88 686 | 85 984 |
| Associated companies and joint ventures | 8 300 | 10 489 | 10 464 |
| Non-current receivables and shares | 8 079 | 8 071 | 7 941 |
| Assets for reimbursement of provisions | 17 900 | 20 700 | 22 610 |
| Total non-current assets | 463 983 | 445 611 | 397 178 |
| Current assets | |||
| Trade receivables | 572 814 | 464 665 | 455 058 |
| Work in progress | 302 133 | 368 320 | 270 346 |
| Other receivables and prepaid costs | 90 768 | 93 645 | 83 007 |
| Cash and cash equivalents | 157 810 | 146 881 | 175 990 |
| Total current assets | 1 123 524 | 1 073 511 | 984 401 |
| Total assets | 1 587 508 | 1 519 122 | 1 381 579 |
| EQUITY AND LIABILITIES | |||
| Shareholders' equity | |||
| Total paid in equity | 26 233 | 26 235 | 26 443 |
| Other equity | 489 720 | 556 399 | 481 077 |
| Total shareholders' equity | 515 953 | 582 635 | 507 520 |
| Non-current liabilities | |||
| Retirement benefit obligations | 5 122 | 5 749 | 5 859 |
| Deferred tax | 12 920 | 12 883 | 11 075 |
| Provisions | 25 336 | 29 717 | 33 527 |
| Non-current interest bearing liabilities | 97 683 | 100 898 | 55 994 |
| Total non-current liabilities | 141 062 | 149 248 | 106 454 |
| Current liabilities | |||
| Trade payables | 111 427 | 129 403 | 151 903 |
| Current tax liabilities | 25 702 | 29 515 | 29 454 |
| VAT and other public taxes and duties payables | 239 430 | 226 550 | 248 124 |
| Current interest bearing liabilities | 149 121 | 55 811 | 3 477 |
| Other current liabilities | 404 812 | 345 960 | 334 648 |
| Total current liabilities | 930 493 | 787 239 | 767 605 |
| Total liabilities | 1 071 555 | 936 487 | 874 059 |
| Total equity and liabilities | 1 587 508 | 1 519 122 | 1 381 579 |
| Amounts in TNOK | Share capital |
Own shares |
Share premium |
Total paid-in capital |
Retained earnings |
Pension | Translation differences |
Total equity |
|---|---|---|---|---|---|---|---|---|
| 31 December 2015 | 13 125 | (9) | 13 320 | 26 436 | 550 241 | (229 676) | 3 179 | 350 181 |
| Dividend | - | - | - | - | (76 123) | - | - | (76 123) |
| Treasury shares | - | 8 | - | 8 | 1 483 | - | - | 1 491 |
| Employee share purchase programme | - | - | - | - | (215) | - | - | (215) |
| Comprehensive income | - | - | - | - | 98 935 | (55 004) | (3 569) | 40 361 |
| 30 June 2016 | 13 125 | (1) | 13 320 | 26 443 | 574 322 | (284 680) | (390) | 315 696 |
| 31 December 2015 | 13 125 | (9) | 13 320 | 26 436 | 550 241 | (229 676) | 3 179 | 350 181 |
| Dividend | - | - | - | - | (76 123) | - | - | (76 123) |
| Treasury shares | - | 8 | - | 8 | 1 542 | - | - | 1 550 |
| Employee share purchase programme | - | - | - | - | (6 119) | - | - | (6 119) |
| Comprehensive income | - | - | - | - | 213 768 | 28 452 | (4 187) | 238 033 |
| 31 December 2016 | 13 125 | (1) | 13 320 | 26 443 | 683 309 | (201 224) | (1 008) | 507 520 |
| Dividend | - | - | - | - | (78 715) | - | - | (78 715) |
| Treasury shares | - | (3) | - | (3) | (551) | - | - | (554) |
| Employee share purchase programme | - | - | - | - | - | - | - | - |
| Comprehensive income | - | - | - | - | 83 035 | - | 4 665 | 87 700 |
| 30 June 2017 | 13 125 | (4) | 13 320 | 26 440 | 687 079 | (201 224) | 3 658 | 515 953 |
| Amounts in TNOK | Q2 2017 | Q2 2016 | H1 2017 | H1 2016 | FY 2016 |
|---|---|---|---|---|---|
| Cash flows from operating activities | |||||
| Profit before tax | 14 373 | 82 786 | 108 638 | 130 953 | 287 732 |
| Income taxes paid | (7 294) | (28 996) | (33 574) | (57 264) | (60 412) |
| Depreciation, amortization and impairment | 11 520 | 10 881 | 22 601 | 21 179 | 43 205 |
| Results from associated companies and joint ventures | (12) | (2 780) | (599) | (4 020) | (4 053) |
| Non cash pension cost | - | 18 611 | - | (6 979) | (110 238) |
| Sub total operating activities | 18 586 | 80 503 | 97 066 | 83 869 | 156 233 |
| Changes in working capital | (4 620) | (39 638) | (149 933) | (144 449) | (66 066) |
| Net cash flow from operating activities | 13 966 | 40 865 | (52 868) | (60 580) | 90 167 |
| Cash flows from investment activities | |||||
| Net purchase and sale of fixed assets and financial non-current assets | (10 706) | (13 468) | (23 555) | (20 476) | (37 872) |
| Proceeds/payments related to equity accounted investments | - | - | - | - | 847 |
| Net cash effect of business combinations | (6 425) | (20 255) | (56 878) | (20 255) | (64 260) |
| Net cash flow used in investment activities | (17 131) | (33 723) | (80 433) | (40 731) | (101 285) |
| Cash flows from financing activities | |||||
| Change in interest-bearing liabilities | 90 096 | - | 187 334 | - | 46 525 |
| Paid dividends | (78 715) | (76 123) | (78 715) | (76 123) | (76 123) |
| Sale treaury shares | - | - | - | - | 42 607 |
| Purchase treasury shares | (554) | - | (554) | - | (50 339) |
| Net cash flow from financing activities | 10 827 | (76 123) | 108 065 | (76 123) | (37 329) |
| Foreign currency effects on cash and cash equivalents | 3 267 | (3 737) | 7 056 | (5 550) | (8 516) |
| Net increase/decrease in cash and cash equivalents | 10 929 | (72 717) | (18 180) | (182 984) | (56 964) |
| Cash and cash equivalents at the beginning of the period | 146 881 | 122 686 | 175 990 | 232 953 | 232 954 |
| Cash and cash equivalents at the end of the period | 157 810 | 49 969 | 157 810 | 49 969 | 175 990 |
Multiconsult ASA (the company) is a Norwegian public limited liability company listed on Oslo Børs. The company and its subsidiaries (together the Multiconsult group/the group) are
The financial statements are presented in NOK, rounded to the nearest thousand, unless otherwise stated. As a result of rounding adjustments, the figures in one or more rows or columns included in the financial statements and notes may not add up to the total of that row or column.
These interim condensed consolidated financial statements for the second quarter of 2017 have been prepared in accordance with IAS 34 as approved by the EU (IAS 34). They have not been audited. They do not include all of the information required for full annual financial statements of the group and should be read in conjunction with the consolidated financial statements for 2016. The accounting policies applied are consistent with those applied and described in the consolidated annual financial statements for 2016, which are available upon request from the company's registered office at Nedre Skøyenvei 2, 0276 Oslo and at www.multiconsult.no.
The preparation of interim condensed consolidated financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates. In preparing these interim condensed consolidated financial statements, significant judgements made by management in applying the group's accounting policies and the key sources of estimation uncertainty were the same as those applied to the annual consolidated financial statements for 2016 (see especially note 2).
among the leading suppliers of consultancy and design services in Norway and the Nordic region. The group has some activity outside the Nordic region, including subsidiaries Multiconsult Polska, Multiconsult UK and Multiconsult Asia.
These interim condensed consolidated financial statements for the second quarter of 2017 were approved by the Board of Directors and the CEO on 30 August 2017.
The group prepares its consolidated annual financial statements in accordance with IFRS as adopted by the EU (International Financial Reporting Standards - IFRS). References to IFRS in these financial statements refer to IFRS as approved by the EU. The accounting policies adopted are consistent with those of the previous financial year.
At the time of approval for issue of these interim condensed consolidated financial statements, some new standards, amendments to standards and interpretations have been published, but are not yet effective and have not been applied in preparing these consolidated financial statements. Those that may be relevant for the group are described in note 2 to the annual consolidated financial statements for 2016.
Refer to note 5 to the consolidated annual financial statements for 2016 for more information on the segments.
The group has three geographical reportable segments in addition to a segment for LINK arkitektur. Revenues and
expenses are reported in the segment where the employee is employed. The cost of administrative services, rent of premises, depreciation and so forth is allocated to the segments.
| Greater | Regions | Inter | LINK | Not | Elimi | ||
|---|---|---|---|---|---|---|---|
| Amounts in TNOK | Oslo Area | Norway | national | arkitektur | allocated | nations | Total |
| External revenues | 366 372 | 284 338 | 46 285 | 146 378 | (2 874) | - | 840 500 |
| Internal revenues | 4 743 | - | 11 422 | 4 470 | 970 | (21 605) | - |
| Total operating revenues | 371 115 | 284 338 | 57 707 | 150 848 | (1 903) | (21 605) | 840 500 |
| Net operating revenues | 308 444 | 268 174 | 46 251 | 118 347 | (2 318) | - | 738 898 |
| Operating expenses | 297 429 | 255 168 | 42 873 | 117 693 | (1 546) | - | 711 618 |
| EBITDA | 11 015 | 13 007 | 3 377 | 654 | (772) | - | 27 281 |
| Depreciation, amortisation, impairment | 3 638 | 5 972 | 598 | 1 346 | (34) | - | 11 520 |
| EBIT | 7 377 | 7 035 | 2 779 | (692) | (737) | - | 15 762 |
| Associates and joint ventures | 93 | - | 18 | - | - | - | 110 |
| Receivables 1) | 362 158 | 275 606 | 78 855 | 185 590 | 3 163 | (17 399) | 887 972 |
| Number of employees | 903 | 827 | 197 | 454 | 130 | - | 2 511 |
1) Receivables includes accounts receivables (before provision for loss) and accrued revenues.
| Amounts in TNOK | Greater Oslo Area |
Regions Norway |
Inter national |
LINK arkitektur |
Not allocated |
Elimi nations |
Total |
|---|---|---|---|---|---|---|---|
| External revenues | 405 534 | 279 358 | 26 407 | 101 673 | 4 700 | - | 817 671 |
| Internal revenues | 2 330 | - | 8 887 | 5 173 | 2 438 | (18 828) | - |
| Total operating revenues | 407 864 | 279 358 | 35 294 | 106 846 | 7 138 | (18 828) | 817 671 |
| Net operating revenues | 324 704 | 261 541 | 24 604 | 94 171 | 5 875 | - | 710 895 |
| Operating expenses | 270 243 | 231 919 | 22 121 | 88 678 | 5 963 | - | 618 925 |
| EBITDA | 54 461 | 29 622 | 2 483 | 5 493 | (88) | - | 91 970 |
| Depreciation, amortisation, impairment | 3 107 | 6 297 | 442 | 1 039 | - | - | 10 885 |
| EBIT | 51 354 | 23 325 | 2 041 | 4 454 | (88) | - | 81 086 |
| Associates and joint ventures | 154 | - | 2 626 | - | - | - | 2 780 |
| Receivables 1) | 363 843 | 255 249 | 51 859 | 101 412 | 3 843 | (7 636) | 768 570 |
| Number of employees | 854 | 788 | 127 | 337 | 116 | - | 2 222 |
1) Receivables includes accounts receivables (before provision for loss) and accrued revenues.
| Amounts in TNOK | Greater Oslo Area |
Regions Norway |
Inter national |
LINK arkitektur |
Not allocated |
Elimi nations |
Total |
|---|---|---|---|---|---|---|---|
| External revenues | 777 661 | 581 537 | 90 981 | 287 135 | (4 190) | - | 1 733 123 |
| Internal revenues | 8 575 | - | 22 801 | 8 306 | 2 092 | (41 774) | - |
| Total operating revenues | 786 236 | 581 537 | 113 782 | 295 441 | (2 098) | (41 774) 1 733 123 | |
| Net operating revenues | 659 056 | 550 027 | 92 754 | 240 063 | (3 265) | - | 1 538 634 |
| Operating expenses | 592 291 | 508 864 | 75 794 | 229 945 | (1 058) | - | 1 405 836 |
| EBITDA | 66 765 | 41 163 | 16 959 | 10 118 | (2 207) | - | 132 798 |
| Depreciation, amortisation, impairment | 7 277 | 11 737 | 1 071 | 2 533 | (17) | - | 22 600 |
| EBIT | 59 488 | 29 426 | 15 888 | 7 585 | (2 190) | - | 110 197 |
| Associates and joint ventures | 157 | - | 442 | - | - | - | 599 |
| Receivables 1) | 362 158 | 275 606 | 78 855 | 185 590 | 3 163 | (17 399) | 887 972 |
| Number of employees | 903 | 827 | 197 | 454 | 130 | - | 2 511 |
1) Receivables includes accounts receivables (before provision for loss) and accrued revenues.
| Amounts in TNOK | Greater Oslo Area |
Regions Norway |
Inter national |
LINK arkitektur |
Not allocated |
Elimi nations |
Total |
|---|---|---|---|---|---|---|---|
| External revenues | 767 838 | 533 737 | 45 209 | 197 282 | 5 863 | - | 1 549 928 |
| Internal revenues | 6 729 | - | 15 396 | 8 489 | 4 397 | (35 011) | - |
| Total operating revenues | 774 567 | 533 737 | 60 605 | 205 771 | 10 260 | (35 011) | 1 549 928 |
| Net operating revenues | 626 241 | 502 138 | 43 882 | 183 655 | 8 893 | - | 1 364 810 |
| Operating expenses | 532 236 | 454 419 | 41 524 | 177 871 | 8 530 | - | 1 214 580 |
| EBITDA | 94 005 | 47 719 | 2 358 | 5 784 | 364 | - | 150 231 |
| Depreciation, amortisation, impairment | 6 082 | 12 143 | 895 | 2 061 | - | - | 21 182 |
| EBIT | 87 923 | 35 576 | 1 463 | 3 723 | 364 | - | 129 049 |
| Associates and joint ventures | 210 | - | 3 810 | - | - | - | 4 020 |
| Receivables 1) | 363 843 | 255 249 | 51 859 | 101 412 | 3 843 | (7 636) | 768 570 |
| Number of employees | 854 | 788 | 127 | 337 | 116 | - | 2 222 |
1) Receivables includes accounts receivables (before provision for loss) and accrued revenues.
| Amounts in TNOK | Greater Oslo Area |
Regions Norway |
Inter national |
LINK arkitektur |
Not allocated |
Elimi nations |
Total |
|---|---|---|---|---|---|---|---|
| External revenues | 1 466 774 | 1 026 004 | 104 642 | 369 580 | 1 070 | - | 2 968 069 |
| Internal revenues | 12 598 | - | 35 112 | 17 409 | 5 500 | (70 619) | - |
| Total operating revenues | 1 479 372 | 1 026 004 | 139 754 | 386 989 | 6 570 | (70 619) | 2 968 069 |
| Net operating revenues | 1 197 326 | 960 560 | 97 036 | 346 126 | 3 573 | - | 2 604 621 |
| Operating expenses 1) | 1 057 524 | 900 600 | 84 208 | 332 015 | (102 516) | - | 2 271 832 |
| EBITDA | 139 801 | 59 960 | 12 828 | 14 111 | 106 089 | - | 332 788 |
| Depreciation, amortisation, impairment | 14 675 | 22 668 | 1 696 | 4 166 | - | - | 43 205 |
| EBIT | 125 125 | 37 292 | 11 132 | 9 945 | 106 089 | - | 289 584 |
| Associates and joint ventures | 513 | - | 3 539 | - | - | - | 4 053 |
| Receivables 2) | 324 411 | 221 657 | 53 014 | 152 188 | 3 312 | (18 241) | 736 341 |
| Number of employees | 879 | 793 | 130 | 420 | 122 | - | 2 344 |
1) Gain of settlement of defined benefit pension plan of NOK 107.3 million is included as decreased operating expenses, not allocated.
2) Receivables includes accounts receivables (before provision for loss) and accrued revenues.
An adjustment to the business area definitions was implemented from 1 January 2017 in response to recent market developments. The new business areas and the respective operating revenues
for the second quarter and first half 2017 are presented in the table below.
| Amounts in TNOK | Q2 2017 | H1 2017 |
|---|---|---|
| Buildings & Properties | 392 680 | 822 468 |
| Industry | 54 618 | 110 276 |
| Oil & Gas | 21 890 | 66 612 |
| Renewable Energy | 112 556 | 224 477 |
| Transportation | 207 097 | 405 588 |
| Water & Environment | 51 659 | 103 702 |
| Total | 840 500 | 1 733 123 |
Buildings & Properties include advisory and engineering at all stages of a construction project for all types of buildings. The business area provides services such as demand- and feasibility studies, sketch pre-project, detailed design and follow-up during the construction period, and real estate consultancy. The focus is on sustainable and long-term solutions. LINK arkitektur is included.
Industry offers complete, interdisciplinary advisory and engineering services in all project phases. Services include investigations, development of projects, project management, design and procurement, construction with all technical systems, construction management and follow-up, and commissioning.
Oil & Gas provides services throughout the whole value chain, from early phase studies through FEED (Front End Engineering Design) to detailed engineering and delivery for both onshore and offshore projects. Services provided onshore are within terminal and production facilities, facilities and constructions, harbour and marine constructions, underground warehouses, land-based pipelines and landfills, and electrical substations. Services provided offshore are within oil and gas rigs and
platforms, concrete marine constructions, modules and structures for rigs and platforms, seabed installations, arctic climate technology for floating and subsea constructions, and noise and vibration measurement among others.
Renewable Energy covers the entire project life cycle in hydropower, land-based wind power, marine wind, solar energy, bioenergy and district heating. Services provided are from start-up and preliminary studies to detailed design and construction management, commissioning and operational shutdown.
Transportation largely includes advisory of planning safe and forward-looking transport systems. The business area covers road, rail, airport, harbor and channel transport systems.
Water & Environment includes services in all phases of the lifetime of a project including inspections, engineering, operation and maintenance, and remediation and demolition. The focus is on sustainable development of the society through advisory within Greenhouse gas emissions, flood and slide protection, water and drains, blue-green structures and pollution of air, water and soil.
The group's net operating revenues are affected by the number of working days within each reporting period while employee expenses are recognised for full calendar days. The number of working days in a month is affected by public holidays and vacations. The timing of public holidays (e.g. Easter) during
quarters and whether they fall on weekends or weekdays impacts revenues. Generally, the company's employees are granted leave during Easter and Christmas. The summer holidays primarily impact the month of July and the third quarter.
| Multiconsult ASA acquired 100% of the shares in Iterio AB on | The Annual General Meeting on 11 May 2017 resolved payment of |
|---|---|
| 7 March 2017. See note 12 for further information. | ordinary dividends related to the 2016 financial year of NOK 78.7 |
| million (NOK 3.0 per share) that was paid to the shareholders | |
| registered on 11 May 2017. |
See note 22 to the consolidated financial statements for 2016 for a description of related parties and related parties transactions in 2016.
Among our share holders Stiftelsen Multiconsult (the Foundation) is considered as related party according to the IFRS due to its ownership and influence. The Foundation had a shareholding of 18.7% at 31 December 2016 and 20% at 30 June 2017.
In 2015 Multiconsult ASA introduced a share purchase programme for its employees. Through the share purchase programme the company offers its employees shares in Multiconsult ASA with a discount of 20%. Shares purchased through the programme is subject to a two-year lock-up period. The company had a holding of treasury shares of 1 998 shares at 31 December 2016 and 7 998 shares at 30 June 2017.
The treasury shares reduced equity by NOK 0.8 million at 30 June 2017, equvivalent to the purchase price.
For the periods presented there are no dilutive effects on profits or number of shares. Basic and diluted earnings per share are consequently equal.
| Q2 2017 | Q2 2016 | H1 2017 | H1 2016 | FY 2016 | |
|---|---|---|---|---|---|
| Profit for the period (in TNOK) Average no shares (excl own shares) |
10 972 26 242 784 |
63 144 26 244 258 |
83 035 26 241 964 |
98 935 26 239 724 |
213 769 26 243 164 |
| Earnings per share (NOK) | 0.42 | 2.41 | 3.16 | 3.77 | 8.15 |
For a description of the pension schemes see note 11 to the consolidated financial statements for 2016.
The company has with effect from 31 December 2016 settled the defined benefit pension plan in the parent company in Norway.
A new defined contribution-based pension plan now includes all the parent company employees. Other defined benefit pension plans in the group still exist for four employees in LINK arkitektur AS and one individual agreement in Multiconsult ASA. Refer to note 11 to the consolidated annual financial statements for 2016 for further information on the group's pension plans.
The group's financial instruments are primarily accounts receivables and other receivables, cash and cash equivalents and accounts payables. The group also has some interest
bearing liabilities. It is assumed that the book value is a good approximation of fair value for the group's financial instruments.
| Amounts in TNOK | NOK 30 June 2017 |
NOK 31 March 2017 |
NOK 31 December 2016 |
Local currency 30 June 2017 |
Local currency 31 March 2017 |
Local currency 31 December 2016 |
Local currency |
|---|---|---|---|---|---|---|---|
| Multiconsult ASA | 241 993 | 146 867 | 50 000 | 241 993 | 146 867 | 50 000 | NOK |
| Multiconsult UK | - | 5 359 | 5 837 | - | 500 | 550 | GBP |
| Multiconsult Asia | - | - | 897 | - | - | 150 | SGD |
| Multiconsult Polska | 700 | 419 | 457 | 309 | 193 | 222 | PLN |
| LINK arkitektur AB | 1 428 | 1 382 | - | 1 438 | 1 437 | - | SEK |
| aarhus arkitekterne | 2 683 | 2 683 | 2 279 | 2 177 | 2 177 | 1 865 | DKK |
| Total | 246 804 | 156 710 | 59 470 | - | - | - |
The group owns a limited amount of shares and participations available for sale (NOK 0.6 million), and it is assumed that the book value is a good estimate of fair value. Fair value of
derivatives (currency swaps) were recorded with a loss (liability) of NOK 0.3 million at 30 June 2017 (NOK 0.3 million at 31 March 2017).
On 7 March 2017, Multiconsult ASA acquired all the shares of Iterio AB for NOK 52.6 million (SEK 55.5 million). The acquisition was settled in cash and financed through Multiconsult's existing credit facilities. Incremental external transaction related costs are expensed as part of other operating expenses of NOK 0.5 million. The acquisition is a first step towards Multiconsult's strategic objective of developing a multidisciplinary business in Sweden.
Iterio AB are engineering consultants with focus on planning and construction. They are mainly involved with project and design management as well as data coordination. Their core expertise is within geotechnics, environment and traffic and they have a solid customer base. The company was established in 2011 and employs more than 70 engineers across offices in Stockholm, Gothenburg and Malmø. Iterio AB is a valuable addition and will be a good fit with LINK arkitektur's and Multiconsult group's existing presence and commitment in Sweden and Scandinavia.
Amounts in TSEK
| Assets | 26 580 |
|---|---|
| Liabilities | 13 383 |
| Net identifiable assets and liabilities | 13 197 |
| Goodwill | 42 303 |
|---|---|
| Net assets | 55 500 |
| Cash and cash equivalents | 5 472 |
| Net cash | (50 028) |
The acquisition generated an excess value of SEK 42.3 million. The excess value is allocated to goodwill and is related to the competence of the staff. SEK 5.5 million of the purchase price was paid in the second quarter.
Multiconsult uses alternative performance measures for periodic and annual financial reporting in order to provide a better understanding of the group's underlying financial performance.
The company has with effect from 1 January 2017 settled the defined benefit pension plan. The settlement resulted in a positive P&L effect and Multiconsult has defined that this effect of NOK 107.3 million lower salary expense is excluded from the underlying results in 2016.
| Amounts in MNOK (except percentage) | Q2 2017 | Q2 2016 | H1 2017 | H1 2016 | FY 2016 |
|---|---|---|---|---|---|
| Net operating revenues | 738.9 | 710.9 | 1 538.6 | 1 364.8 | 2 604.6 |
| Reported employee benefit expenses | 589.6 | 505.9 | 1 157.9 | 1 005.1 | 1 841.6 |
| Curtailment of defind benefit pension plan | - | - | - | - | (107.3) |
| Underlying employee benefit expenses | 589.6 | 505.9 | 1 157.9 | 1 005.1 | 1 948.9 |
| Reported other operating expenses | 122.0 | 113.1 | 247.9 | 209.5 | 430.2 |
| EBITDA underlying | 27.3 | 92.0 | 132.8 | 150.2 | 225.5 |
| Depreciation, amortisation and impairments | 11.5 | 10.9 | 22.6 | 21.2 | 43.2 |
| EBIT, underlying | 15.8 | 81.1 | 110.2 | 129.0 | 182.3 |
| EBITDA margin (%), underlying | 3.7% | 12.9% | 8.6% | 11.0% | 8.7% |
| EBIT margin (%), underlying | 2.1% | 11.4% | 7.2% | 9.5% | 7.0% |
| Amounts in MNOK | Q2 2017 | Q2 2016 | H1 2017 | H1 2016 | FY 2016 |
|---|---|---|---|---|---|
| Non-current interest bearing liabilities | 97.7 | 8.7 | 97.7 | 8.7 | 56.0 |
| Current interest bearing liabilities | 149.1 | 1.1 | 149.1 | 1.1 | 3.5 |
| Cash and cash equivalents | 157.8 | 50.0 | 157.8 | 50.0 | 176.0 |
| Net interest bearing debt | 89.0 | (40.1) | 89.0 | (40.1) | (116.5) |
1) Negative is asset.
Nedre Skøyen vei 2, 0276 Oslo P O Box 265 Skøyen, 0213 Oslo Telephone 21 58 50 00 Fax 21 58 50 01
[email protected] www.multiconsult.no Org no 910 253 158
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