Vow ASA — Earnings Release 2019

Oct 22, 2019

SSHIP | Continued profitable growth, and completion of ETIA transaction

Oslo, 22 October 2019 – Scanship continues the result improvements with third quarter revenues of MNOK 88.5 (80.1), a growth of 10 %, and EBITDA of MNOK 12.2 (10.7), a growth of 14 %. Order backlog at MNOK 644 (MNOK 485), + 33 %. The transaction to acquire ETIA Ecotechnologies ("ETIA") was completed on 15 October.

"We are now in the process -together with our new colleagues in ETIA – to implement plans that will make our technology and product offering available to a much broader customer base. Joining forces with ETIA, Scanship has significantly broadened and expanded its addressable market", says Henrik Badin, CEO of Scanship.

Scanship and ETIA will jointly target all markets where pyrolysis can be deployed to convert organic waste, biomass, plastics and polymers into energy, fuels, biogenic materials or molecules for the purpose of decarbonizing energy, capturing carbon, valorising waste and creating end-of waste solutions. The Scanship Group has the ambition to create a market leading supplier in the industries that will be addressed.

There has been a high activity level in cruise in the third quarter both within newbuilding projects and the Aftersales segment. Scanship has in 3Q 2019 performed main equipment deliveries to 7 newbuilding projects, completed commissioning on 3 projects and completed compliance procedures on 4 projects.

The project cooperation announced in April to deliver the first landbased industrial system with microwave assisted pyrolysis inside to the VOW research program at Lindum in Drammen, Norway has also progressed according to plan with a high activity level in the third quarter.

The financial results for ETIA will be included in the Scanship Group accounts from 4Q 2019 and onwards.

				YTD	YTD		Year
(NOK million)	3Q 2019	3Q 2018	Incr.	3Q 2019	3Q 2018	Incr.	2018
Total Revenue	88.5	80.1	10 %	269.8	226.6	19 %	329.6
EBITDA	12.2	10.7	14 %	34.8	27.0	29 %	39.2
EBITDA margin %	13.8 %	13.4 %		12.9 %	11.9 %		11.9 %
Project Backlog				644	485		656

Key figures

Scanship has a leading position in the cruise market, which is expected to continue to grow and will represent the backbone of our business for quite some time yet. The total industry orderbook to date is 125 cruise ships to be delivered until 2027. Scanship has firm orders on 39 newbuilds, additional options for 9 vessels and sister vessels, and is currently tendering for a significant number of the remaining addressable market. Shipowners sustainability goals, changes in regulatory environments and the overall industry growth drives markets both in newbuild and retrofits.

Going forward, it is expected that an increasing share of our business will be land-based. The European biogas industry is one such market segment. Across Europe more than 8 000 new plants are forecasted by 2025. Scanship and ETIA has so far delivered to seven applications relevant to this market.

The vast volume of uncollected plastic waste is another interesting opportunity for Scanship and ETIA. Our first full scale plastic-to-electricity plant is already up and running. This plant is owned by Race for Water, a foundation with a mission to preserve the oceans, and with a target to set up 4 000 plastic-to-electricity plants around the world.

In France the company is part of a programme aimed at demonstrating that ultra-high temperature pyrolysis can convert otherwise non-recyclable plastic waste into hydrogen and pyro-carbon. Scanship and ETIA are also applying its pyrolysis technology to create biocoke, which replaces fossil coal as reducing agent in metallurgic applications, and our first full scale plant of this kind will be delivered in Q4 this year.

"We are thrilled to explore these and other exciting opportunities and keen to combine them with our proven and scalable delivery model. Our ambition is to replicate the remarkable growth that we have had in the cruise market in other industry segments. We think this makes perfect business sense. But is also makes sense in a much wider perspective. A common feature of all our work is to give waste value. We think this is the key to building a sustainable and green world economy", says Henrik Badin, CEO of Scanship in a closing remark.

For further queries, please contact:

Henrik Badin - CEO Scanship Holding ASA Tel: + 47 90 78 98 25 Email: henrik.badin@scanship.no

ABOUT SCANSHIP HOLDING ASA

Scanship delivers world leading solutions for cleaner oceans in the cruise and aquaculture industries. Scanship provides advanced technologies for processing waste and purifying wastewater. Owners operating Scanship systems have the solution to convert all waste and wastewater into clean energy and purified water which meets the highest international discharge standards. Any residuals from the Scanship processes can be recovered for reuse. This information is subject to the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.