NRC Group — Investor Presentation 2021

May 12, 2021

Q1 2021 result presentation

CEO Henning Olsen and CFO Dag Fladby 12 May 2021

Disclaimer

• This draft presentation (hereinafter referred to as the "Presentation") has been prepared exclusively for information purposes and does not constitute an offer to sell or the solicitation of an offer to buy any financial instruments.
• This Presentation includes and is based on, among other things, forward-looking information and statements. Such forward-looking information and statements are based on current expectations, estimates and projections. Such forward-looking information and statements reflect current views with respect to future events and are subject to risks, uncertainties and assumptions. We cannot give any assurance as to the correctness of such information and statements.
• Several factors could cause the actual results, performance or achievements of the companies mentioned herein to be materially different from any future results, performance or achievements that may be expressed or implied by statements and information in this Presentation, including, among others, risks or uncertainties associated with the company's business, segment, development, growth management, financing, market acceptance and relations with customers, and, more generally, general economic and business conditions, changes in domestic and foreign laws and regulations, taxes, changes in competition and pricing environments, fluctuations in currency exchange rates and interest rates and other factors. Should one or more of these risks or uncertainties materialise, or should underlying assumption prove incorrect, actual results may vary materially from those described in this document. We do not intend, and do not assume any obligation, to update or correct the information included in this Presentation.
• There may have been changes in matters which affect the companies herein subsequent to the date of this Presentation. Neitherthe issue nor delivery of this Presentation shall under any circumstance create any implication that the information contained herein is correct as of any time subsequent to the date hereof or that the affairs of the company/companies have not since changed, and we do not intend, and do not assume any obligation, to update or correct any information included in this Presentation.
• This Presentation is subject to Norwegian law, and any dispute arising in respect of this Presentation is subject to the exclusive jurisdiction of Norwegian courts with Oslo City Court AS exclusive venue.

Highlights Q1 2021

Operations and business during Covid-19

Main priorities

Operations

• Keep employees safe and minimize impact on operations
• Compliant with public restrictions and recommendations

• Monitor potential effects on the industry and NRC Group's business

• Limited impact on project execution to date

• Maintenance and upgrade activities considered critical infrastructure
• Increasing uncertainty due further increase of infection
• Restrictions related to workforce mobility, will lead to higher production cost
• The Norwegian Government imposed even stricter rules on foreign nationals seeking entry to Norway that will affect production over time

Risk management

• Maintaining robust financial position
• National public transport agencies represent ~95% of backlog
• Outbreaks may impact productivity, project execution and value chain
• Dependent on customers announcing and awarding tenders as scheduled

*LTI -1: Injuries resulting in absence at least one full day per million man -hours (incl subcontractors)

**LTI -2: lost time injuries in total per million man -hours, also including injuries that require medical treatment and alternative work (incl subcontractors)

Figures per 31 March 2021 compared with 31 March 2020

Sustainable work in NRC Group

• Sustainability report launched in April 2021, prepared in accordance with the Global Reporting Initiative (GRI) Standards
• Monitoring the EU's work on Sustainable Finance and the EU Taxonomy regulation
• Defining GHG emission reduction targets and energy intensity
• Sustainability Training for all employees
• Recently signed membership UN Global Compact

* Before other income and expenses (M&A expenses)

7

Q1 key figures – profit & loss

• Revenue of NOK 1,129 million
• EBITA* of NOK -59 million
  • Continued good performance in Finland
  • Lower revenue in Sweden affects the profitability
  • Norway in line with last year

(Amounts in NOK million)	Q1 2021	Q1 2020	FY 2020
Revenue	1 129	1 254	6 449
Operating expenses	1 139	1 255	6 185
EBITDA*	-10	-1	264
Other income and expenses (M&A expenses)	-6	-7	-1
EBITDA	-16	-8	263
Depreciation	49	ਦੇ ਤੋ	214
EBITA*	-59	-54	50
EBITA	-64	-61	ਧਰੇ
Amortisation	12	15	59
Operating profit/loss (EBIT)	-77	-77	-10
Net financial items	-18	-22	-84
Profit/loss before tax (EBT)	-ਰੇਟ	-ਰੇਰੇ	-94

Q1 key figures – balance sheet

• Goodwill and other intangible assets: NOK 2,890 million
• Cash: NOK 551 million
• Interest-bearing debt reduced by NOK 110 million to NOK 1,658 million
  • Operating lease of NOK 146 million
• Net interest bearing debt reduced by NOK 51 million, to NOK 1,107 million
• Equity ratio: 48%

(Amounts in NOK million)
ASSETS	31.03.2021	31.03.2020	31.12.2020
Intangible assets	2 890	3 068	3 010
Right-of-use assets	541	539	588
Total other non-current assets	217	335	255
Cash and cash equivalents	551	821	610
Other current assets	1 208	1 384	1 404
Total assets	5 407	6 147	5 867
EQUITY AND LIABILITIES
Total equity	2 581	2 777	2 731
Long-term financial lease liabilities	257	220	290
Long-term operating lease liabilities	91	130	106
Other non-current interest-bearing liabilities	986	1 210	1 042
Other non-current liabilities	38	65	52
Short-term financial lease liabilities	123	126	120
Short-term operating lease liabilities	55	66	57
Other interest-bearing current liabilities	146	168	153
Other current liabilities	1 129	1 386	1 316
Total equity and liabilities	5 407	6 147	5 867

Q1 key figures – cash flow

• Operating cash flow of NOK 17 million.
  • Q120 included an extraordinary sale of inventory of approximately NOK 110 million
• Net cash flow from financing activities of NOK -96 million

(Amounts in NOK million)	Q1 2021	Q1 2020	FY 2020
Profit/loss before tax	-95	-99	-94
Net cash flow from operating activities - continuing	17	43	312
Net cash flow from operating activities - discontinued	0	14	4
Net cash flow from operating activities	17	57	316
Net cash flow from investing activities	13	-8	-150
Net cash flow from financing activities	-96	610	304
Net change in cash and cash equivalents	-66	659	470
Cash and cash equivalents at the end of the period	551	821	610

Robust financial position as per 31 March

Bank and bond maturities

• Cash position of NOK 551 million
• Undrawn Revolver Credit Facility of NOK 200 million
• Net interest bearing debt of NOK 1,107 million

Operational review

NRC Group Finland – Good performance

-20

NRC Group Finland – Solid tender pipeline

NOK 3.9 billion tender pipeline¹ NOK million value, # of tenders, next 9 months #1 #11 #3 #22 #1 2 650 1 250 0 500 1 000 1 500 2 000 2 500 3 000 Rail construction Maintenance NOK >300m NOK 100-300m NOK 30-100m Tender pipeline • Decreased with NOK 1.2 Bn from Q420 pipeline, mainly Rail construction projects • NOK 2.4 Bn increase from same period last year mainly related to rail construction projects NTSP* • The first National Transport System Plan (NTSP) for 2021-2032 prepared by the government. The NTSP is expected to be approved in Q2 2021 Light rail projects • Crown Bridge project is expected to be decided Q3/Q4 2021 • Continued high investment level expected in the coming years • NRC Finland is market leader

NRC Group Sweden – Low revenue impacting profitability

NRC Group Sweden – Strong tender pipeline

NOK 9.2 billion tender pipeline¹

(NOK million value, # of tenders, next 9 months)

NRC Group Norway – In line with last year

-100 -80

NRC Group Norway - Strong tender pipeline

NOK 9.2 billion tender pipeline¹

(NOK million value, # of tenders, next 9 months)

• Increase of NOK 3.1 Bn in tender pipeline vs Q420 and

Summary

Financials

• Revenues NOK 1.1 billion • EBITA* NOK -59 million
• Cash position of NOK 551 million

Operations • Focus on core processes in tendering and project execution continues in order to restore profitability

Outlook

• 2021 EBITA*margin expected to be 1.75-2.5%
• Continued strong outlook for investments in sustainable infrastructure confirmed by NTP proposals for 2022-2033 in Norway and Sweden, and by NTSP for 2021-2032 in Finland

Appendix

Segments – key figures quarterly development

					Reported**	Reported**	Reported	Reported***	Reported	Reported	Reported	Reported	Reported
Norway operations (NOK million)	FY 2017	FY 2018	FY 2019	FY 2020	Q1 2019	Q2 2019	Q3 2019	Q4 2019	Q1 2020	Q2 2020	Q3 2020	Q4 2020	Q1 2020
Total revenue	771	1 598	2 281	1 866	470	545	683	583	407	476	541	442	423
EBITDA*	43	136	186	82	14	65	75	32	7	50	41	-17	6
EBITA*	21	96	97	-14	-5	43	52	8	-14	27	16	-43	-17
EBIT*	5	75	70	-23	-13	35	45	2	-18	23	16	-44	-18
Sweden operations (NOK million)	FY 2017	FY 2018	FY 2019	FY 2020	Q1 2019	Q2 2019	Q3 2019	Q4 2019	Q1 2020	Q2 2020	Q3 2020	Q4 2020	Q1 2020
Total revenue	1 613	1 591	1 539	1 777	299	411	460	370	311	487	583	396	259
EBITDA*	221	27	-77	-21	-7	-13	14	-71	-15	0	4	-10	-22
EBITA*	198	-8	-125	-69	-20	-24	2	-83	-27	-13	-7	-22	-35
EBIT*	179	-16	-125	-71	-20	-24	2	-83	-28	-14	-8	-23	-36
Finland operations (NOK million)	FY 2017	FY 2018	FY 2019	FY 2020	Q1 2019	Q2 2019	Q3 2019	Q4 2019	Q1 2020	Q2 2020	Q3 2020	Q4 2020	Q1 2020
Total revenue			2 388	2 811	361	601	712	713	540	700	831	740	446
EBITDA*			191	231	4	64	70	53	16	37	100	78	15
EBITA*			116	161	-13	45	55	29	-3	19	84	62	2
EBIT*			75	116	-24	35	45	19	-14	7	72	50	-9
Total group segment accounts	FY 2017	FY 2018	FY 2019	FY 2020	Q1 2019	Q2 2019	Q3 2019	Q4 2019	Q1 2020	Q2 2020	Q3 2020	Q4 2020	Q1 2020
Total revenue	2 373	3 176	6 449	6 449	1 130	1 551	1 850	1 919	1 254	1 661	1 956	1 578	1 129
EBITDA*	236	132	264	264	-3	103	153	11	-1	81	140	44	-10
EBITA*	190	57	50	50	-54	51	105	-51	-54	27	88	-10	-59
EBIT*	156	29	-8	-8	-72	34	87	-57	-69	11	75	-25	-71

*Before other income and expenses (M&A expenses).

**Design operations restated as discontinued operations.

***Restated due to deviation from Q4 to full-year 2019 report related to the final settlement of a dispute from 2015 decided by an arbitration court.

Orderbook and order intake Q1 2021

Order book* (NOK million)

Order intake (NOK million)

• Order book NOK 5,961 million
• Order intake of NOK 860 million
  • Announced orders NOK 386 million
  • Unannounced orders NOK 474 million includes;
    • Reversal of MA5 maintenance contract of approximately NOK -183 million
    • Currency adjustment of NOK -245 million

Orderbook and book to bill

Order book execution by country NOK million

Book-to-bill ratio Period order intake/revenue

Finland – Confirmed continued high level of investment in 2021

Rail investments and maintenance spending1 EUR million, 2019-24

Sweden – High investment level in line with expectations

Rail investments and maintenance spending1 SEK billion, 2019-24

Norway - Investment growth in 2021 mainly related to on-going projects

Rail investments and maintenance spending¹ NOK billion, 2019-24

1) Norway: Proposed National budget 2021, National Railway Directorate NTP filings. Maintenance figures include Bane NOR operations and renewal, partly addressable. Excluding tram and metro. NTP: National Transportation Plan 2018-2029